Test drive: Income tax software tips

If God wrote the Ten Commandments, then Satan's literary work must be the U.S. Tax Code - which is why this is the time of year that tax preparation software comes to mind.

Instead of being a plan for living in 10 declarative sentences, the tax code is thousands of variations on the theme of Fork It Over. Tax software can help many of us wade through baffling language on the Internal Revenue Service Web site, www.irs.gov.

It's important to understand a few things before you spring for a tax preparation package: If you didn't keep good records, the software can't invent them for you.

For example, if you used an electronic checkbook-bill paying program but didn't classify expenses by tax category, you have the electronic equivalent of a shoebox of canceled checks.

While it's less effort than tackling forms with a typewriter and calculator, it's still more effort than handing your records to a human tax preparer and signing the result. If you have a complicated return, you should consider if you want to invest the time.

"The software made me do it" is not an adequate defense if the IRS questions your return.

If you're not itemizing deductions, save your money for something else.

That said, it comes down to which tax software package is for you. The two dominant ones are Intuit's TurboTax Deluxe and H&R Block's TaxCut. Both will handle federal and state taxes, interviewing you and producing and printing the appropriate forms.

You can find their claims at www.taxcut.com and www.turbotax.com. Both will "audit" your return and flag discrepancies while making suggestions for deductions.

System requirements for both are toward the minimum end - 486 processor and 16 MB of RAM in the Windows 95 and later, CD-ROM drive, color monitor and sound card. For the Mac crowd, TaxCut wants to see 68030 or better and System 7.5.3 or later, while TurboTax wants 7.6 or higher.

Copyright © 2014, Los Angeles Times
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