Hi all:
In response to TurboTax's stealth price increase I ordered TaxCut online. Before TaxCut showed up TurboTax reversed itself on the stealth price increase and I picked up TurboTax at Costco. Having done my preliminary 2008 taxes in both programs I thought I'd point out a couple of places where TurboTax was clearly superior.
Health Savings Account deduction for AGI:
I've been very critical of TurboTax in the past for their programming surrounding the HSA deduction. First, the issue of an HSA didn't come up in the course of the regular interview process. Instead, you had to "invoke" the process in order to get TurboTax to fire up an HSA interview process. Second, the interview was slapdash, requiring you to have a significant "tax knowledge" of HSA's. This, combined with TurboTax's poor wording of interview questions, meant that I always got the wrong answer on the first pass through the interview. (Luckily, I always knew what the "right' answer should be so I'd recognize the answer was wrong and then resort to the forms method to come up with the right answer.) This year I didn't have to "invoke" the TurboTax HSA interview - it came up as part of the regular interview process - and the questions TurboTax asked resulted in the right answer the 1st time!
In contrast, TaxCut's interview process reminded me of TurboTax's from prior years - though it did come up as part of the regular interview process - in that it required too much HSA "tax knowledge" to get the right answer the 1st time through. I had to dive into the forms to get things squared away.
Advantage: TurboTax
Tax Benefit Rule:
TurboTax got the Tax Benefit Rule right while TaxCut didn't. I didn't itemize in 2007, but will itemize in 2008. In January 2008 I made my
4th state estimated tax payment (a deduction for 2008) but also got a state tax refund after filing in April, 2008. TurboTax correctly allocated a portion of the refund to the January, 2007 state tax payment - a reduction of my itemized deduction on Schedule A - while TaxCut didn't, telling me the entire refund was non-taxable. While I certainly liked TaxCut's answer better from the standpoint of 2008 Federal Taxes it's the wrong answer. TaxCut's on-line "chat" folk also couldn't grasp the problem, though one of them told me that TaxCut has a "calculation guarantee" (!).Advantage: TurboTax
This is the 1st time I tried TaxCut and had high hopes for it; too bad it didn't work out.
Tom Young