TaxAct Software

[taxjungle]

Hello. I want to retire from my tax prep business, but I may still prepare about 10 tax returns next year for family and friends. Does anyone know what is the most economical way to do this? I was wondering if TaxAct Software Ultimate ($21.95) is for the cost of only one tax return with State, or for multiple returns.
I was also thinking about going to the clients home rather than have them come to my home office, (a mobile tax service). Please advise me. Thank you.

[FEDUKE404]

Using TaxACT for small number of returns

My guess is you are looking at the prices for the "personal" version of TaxACT, which may allow a few efiles (5?) not unlike what Intuit (TurboTax) et al allow, but they would likely be shown as "self-prepared" or similar. (I guess you could, in theory, buy software for returns 1-5, buy another software for returns 6-10, etc.) Whether you choose to go that route is your choice, although it is likely you would be breaking some kind of rules by using such software for "professional purposes."

This is the link for "TaxACT software ultimate". What is shown there would SEEM to answer your original question?? (I have zero knowledge of this product.)

LINK: http://www.taxact.com/taxes-online/b...save.asp?yr=14

Here is link to TaxACT professional products. You have several options to include buying software per state, or a multi-state package, and a similar option for paying for each efile versus "unlimited" efiles. You likely could survive with buying state software on an "as needed" basis and also NOT paying for "unlimited" efiles. (IIRC, that breakeven point is somewhere in the range of 40+ returns.)

LINK: http://prep.taxact.com/products/bundles.asp

FWIW: I think Intuit may offer some fairly expensive professional "per return" options for very limited use. Others may know how that works.

Assuming you are going to "sign" the returns, that ("about 10 returns"??) may box you in especially with the IRS requirements for mandatory efiling now in place. (Strong reference is made to Form 8948.)

There have been some other recent discussions of TaxACT software on these boards. (I'll leave it at that. . . . ) Suggest you use TTB search box in top/right corner??

FE

[Roberts]

Tax Act you buy the $120 federal 1040 only program. Each state is $25 (or $100 for all of them). Then $9.99 to email.
So for 10 clients in 1 state = $24.50ish per client. Each additional client is just $9.99 more. Adds up quickly but if you just have 10-20 clients you can make it work.

If you have 35 clients, you are probably better off with their full package or using an OLTPRO type of program. To renew OLTPRO is $499 plus some shipping and with that you get all the major individual and corporate / partnership returns, states and unlimited efiles.

[ruthc]

See Below Info

These are the prices for the bundle options. It is not considered the tax preparer's editions. When they note the $9.99 to e-file federal returns, I am not sure if that includes the state. I pay $9.99 total for e-filing federal and state. But with these options maybe it doesn't include the state. So with these options they only allow a few e-files. I guess they expect you to get the preparer's edition if you prepare more than that.
As stated, you can prepare and print unlimited returns, but will be limited on how many you e-file. Also, in order to e-file you need an EFIN that will be verified by TaxAct before e-filing.
If you are planning on doing about 10 returns per year, it may cost a little more, but I would consider the Preparer's 1040 Edition for $120. They emailed me that prices are going up this year. They said that last year too but the prices remained the same.
One last note is that I am not sure how the below bundle is, but on the Preparer's Edition, I have a place to uncheck where my name wouldn't appear as the preparer, and it doesn't stamp the return as "self-prepared".
Hope this helped in making your decision. I would be cautious on which route to take if you do prepare returns for compensation.

Ultimate Bundle Deluxe (Federal) + State
$21.99 Over the web
• TaxACT Online Deluxe
• TaxACT Online State 1040
• 1 free Federal e-file
• 1 free State e-file
__________________________________________________ ________
$21.99 Download or CD*
• TaxACT Deluxe
• TaxACT State 1040
• Prepare & print unlimited returns
• 1 free Federal e-file, up to 4 additional Federal e-files $9.99 each
__________________________________________________ ________
$28.99 Download or CD*
• TaxACT Deluxe
• TaxACT State 1040
• Prepare & print unlimited returns
• 5 Federal e-files

[FEDUKE404]

Additional

...As stated, you can prepare and print unlimited returns, but will be limited on how many you e-file. Also, in order to e-file you need an EFIN that will be verified by TaxAct before e-filing...

I'm not certain your statement re EFIN etc is correct for users of the "personal" edition (obviously most John Doe taxpayers do NOT have an EFIN!), although it is definitely correct for the "professional" edition. So far as I know, the EFIN verification process is now a requirement regardless of the software provider.

Agreed on how you "turn off" the printing of paid preparer information on the Form 1040, sans any "self-prepared" notation appearing. Of course, that is a separate issue from efiling, and as noted kinda gets back to the issue where any "paid preparer" must always sign the tax return. Of course, there is also that nagging additional problem where the IRS now "requires" efiling of most professionally-prepared tax returns. Issues related to that rule have been beaten to a pulp by prior TTB members, so I will not go anywhere near that topic!! The IRS intent/rules/exceptions do seem pretty clear, at least to me.

I personally think that taxjungle should best pursue the TaxACT Professional version (it does include such things as client letters and invoices, preparation of worksheets for prior clients, etc.), pay for the state(s) software as needed, and pay the "per return" efile cost. TaxACT does offer "prior season" software costs, to include bundled options, but I do not know if that deadline has passed. (I reordered sometime in May. . .) Also, it appears likely that taxjungle would not benefit from any bundled packages, due to the projected low number of tax returns to be prepared in 2015.

As for the efile cost, it is my understanding that if one goes the "per return" route a single $9.99 charge applies, and it covers federal and state(s). There is never a charge to efile a return that was previously "bounced" for whatever reason. LINK OF INTEREST: http://prep.taxact.com/efiling/efile-pricing.asp

FE

[ruthc]

EFIN Required

Yes, FE, you are correct. Only those purchasing the Tax Preparer's Editions are required to have an EFIN. I stand corrected in my prior response. Thanks for pointing that out!

[JohnH]

You could give them the return in paper form and let them mail it in. If you do that, you are not "submitting a tax return on the tax payer's behalf" and therefore you don't need an EFIN. You can even give them mailing instructions, etc. As long as you don't physically drop the return in the mail box, you are not filing the return. It doesn't even need an 8948 attached. This is made very clear on the back side of the 8948.

-->. When a return is considered filed by a preparer.
For the e-file requirement, a return is considered filed by a preparer if the preparer or any member, employee, or agent of the preparer or the preparer’s firm submits the tax return to the IRS on the taxpayer’s behalf, either electronically or in paper format. For example, the act of submitting includes having the preparer or a member of the preparer’s firm drop the return in a mailbox for the taxpayer. Acts such as providing filing or delivery instructions, an addressed envelope, postage estimates, stamps, or similar acts designed to assist the taxpayer in the taxpayer’s efforts to correctly mail or otherwise deliver a paper return to the IRS do not constitute filing by the preparer as long as the taxpayer actually mails or otherwise delivers the return to the IRS. <--

[Zee]

Hello. I want to retire from my tax prep business, but I may still prepare about 10 tax returns next year for family and friends. Does anyone know what is the most economical way to do this? I was wondering if TaxAct Software Ultimate ($21.95) is for the cost of only one tax return with State, or for multiple returns.
I was also thinking about going to the clients home rather than have them come to my home office, (a mobile tax service). Please advise me. Thank you.

Drake is $295 with 15 returns and includes full software, great support, efiling, etc.

[FEDUKE404]

When is preparing not preparing or submitting?

You could give them the return in paper form and let them mail it in. If you do that, you are not "submitting a tax return on the tax payer's behalf" and therefore you don't need an EFIN. You can even give them mailing instructions, etc. As long as you don't physically drop the return in the mail box, you are not filing the return. It doesn't even need an 8948 attached. This is made very clear on the back side of the 8948.

-->. When a return is considered filed by a preparer.
For the e-file requirement, a return is considered filed by a preparer if the preparer or any member, employee, or agent of the preparer or the preparer’s firm submits the tax return to the IRS on the taxpayer’s behalf, either electronically or in paper format. For example, the act of submitting includes having the preparer or a member of the preparer’s firm drop the return in a mailbox for the taxpayer. Acts such as providing filing or delivery instructions, an addressed envelope, postage estimates, stamps, or similar acts designed to assist the taxpayer in the taxpayer’s efforts to correctly mail or otherwise deliver a paper return to the IRS do not constitute filing by the preparer as long as the taxpayer actually mails or otherwise delivers the return to the IRS. <--

Your end run around the IRS efile rules appears to be doable, although I would never consider going that route. Sounds almost like Bill Clinton and "What IS 'is'??"

A more relevant question is why would anyone wish to file paper returns in the first place, assuming they could be efiled (which included more than 98% of my returns last tax season)?? There are way too many problems that can occur with paper returns, to include delayed refunds, erroneous entry by some IRS/state data clerks, USPS and IRS in-house delivery issues, ability for a simple/quick efile fix (such as spouse name issue), "peace of mind" with an IRS/state acceptance response in hand, and more.

Your IRS cite (can I even use that word here any more?? ) does have a bit more verbiage that weakens any "per return" exception that might "not" get filed by a firm. Such matters as total returns prepared by the firm and/or by an individual come into play. Form 8948 can become a requirement. Even if the client "chooses" not to efile, you better have the proper signed statement in your file to cover that "choice." (Required verbiage on taxpayer waiver statement must include such things as "I understand that electronic filing may provide a number of benefits to taxpayers, including an acknowledgment that the IRS received the returns, a reduced chance of errors in processing the returns, and faster refunds. I do not want to have my return electronically filed, and I choose to file my return on paper forms.")

For my 2¢ worth, I cannot see any tax preparation business ever going that route just to avoid the IRS efiling "rules." Heck, just buy the cheapest TurboTax personal software, white out "self-prepared," also consider preparer name/signature "optional" (look up rules for when a preparer IS a preparer??), and I guess you're good to go! (Don't laugh - there was a CPA in this area who did exactly that!)

I just don't lose any sleep over such antics. . .

FE

[JohnH]

It isn't an end run around their rules - it's a matter of understanding what their rules really say.
And there's no reason for any antics.

The best thing to do is to file a Hardship Waiver, get the appropriate authorization number, and attach the 8948 to the return.
But one has to be proactive - the waiver request must be submitted by Feb 15 for the upcoming filing season.
IRS will reply by saying you don't need the waiver if you don't FILE the paper return, but just the same, "here's your number".
It's very seamless and covers all the bases.
The preparer still signs the return (if they were paid to prepare it) - so no shenanigans needed in that respect.

[FEDUKE404]

Why the &quot;hardship&quot; route in the first place?

. . .The best thing to do is to file a Hardship Waiver, get the appropriate authorization number, and attach the 8948 to the return. . .

I would likely be very hard pressed to justify any "hardship" waiver, especially on a recurring (annual) basis.

• I'm not bankrupt
• I have no severe economic problems
• I do not live in a Presidential disaster area
• I have readily available internet access
• The maximum additional efiling cost of, perhaps $10/return, is insignificant as relates to my regular client fees (and with a bundle tax software package my per return efile costs are far less)
• My tax software readily provides a means of efiling
• So far as I know, the Methodists have no problem with a member of their faith efiling a tax return

Also, Form 8944 [ http://www.irs.gov/pub/irs-pdf/f8944.pdf ] has a "Under penalties of perjury..." block above the signature line.

Obviously I am missing a lot here. . . It seems a h-e-double hockey sticks of a lot easier just to efile in the first place!!

FE

[JohnH]

You've covered most of the routine hardship issues, but there's line 9. IRS will consider many other things, and of course it is absolutely essential to tell the truth. And while it's a lot easier for most tax repairers to e-fling, that isn't necessarily true for all tax preparers. Besides, easier can also be more risky, which is clearly the case with e-flinging.

[spanel]

You've covered most of the routine hardship issues, but there's line 9. IRS will consider many other things, and of course it is absolutely essential to tell the truth. And while it's a lot easier for most tax repairers to e-fling, that isn't necessarily true for all tax preparers. Besides, easier can also be more risky, which is clearly the case with e-flinging.

More Risky?!?!

Efile
Your sending encrypted tax returns through your software provider directly to the IRS.
Have to have a background check to get an EFIN.
Receive Acks usually within and hour.

Paper
Your sending un-encrypted tax returns through the post office/ups/fedex with how many places to get lost or stolen?!?
Any one can buy turbo tax and print out a return.
Have no idea when the IRS receives the return and if it okay for weeks.


Yep.. More Risky for sure!

[JohnH]

The efiling risk is all on the preparer,
You make a mistake, you own it.

The paper filing risk is on the taxpayer.
Hand them the return with filing instructions and it's up the them to get it filed.

The risk I'm speaking of isn't concerned with efficiency - it's concerned with liability.

I prepare returns, I don't file returns.
The IRS recognizes the differrnce and so do I.

[ATSMAN]

For 10 family and friends' 1040 return you may want to try the various free file options or TaxAct basic preparer version.