Tag: tax

Categories
401k and Personal Finance uber-and-side-hustle

Turbo Tax Desktop and doing tax for eBay and Uber

Reading Time: 5 minutes

Chinese version (translated by Google) is here: 谷歌翻译的中文版在这里。

Turbo Tax web vs Desktop

I switched from Turbo Tax Web version to Desktop version in last 4 years. The main reason is the latter is cheaper (if we consider both the state and tax). It’s probably $40 to $50 cheaper. Before the switch I used the web version for 20 years. I was happy with the web version for the most part: had one or two minor glitches during 20 years journey. One glitch was on me: it was quite a few years ago, 15 to 20 years ago, when I was working for my 1st employer then. That year I purchased the Turbo Tax state (online version) too, and I also purchased the audit defense. But the stupid program allowed me to put in a negative number for the income in the state tax form, and state rejected the tax filing out of box. It was not too difficult to fix that – zero out the number did the trick if my memory is correct. But after that I decided for the state filing I would just use the online PDF form (with calculation capability), and mail in the tax form to the Jeff City instead.

Also, once I made a bad mistake. I installed the desktop version on my personal laptop MacBook Pro 16 inch Intel. And it crashed on me, and I didn’t have backup copy for the Turbo Tax filing file after filing. I recall from my past experience, Turbo Tax usually started from last year’s return, and at one time I was quite worried. Later luckily I was able to find out the actual e-filing from Uncle Sam’s website. Nowadays I store the Turbo Tax filing file on the cloud – feel a bit safer than my local desktop or laptop 🙂

Last tip for Turbo Tax Web: one can always use it for free (without filing), so for example, if you do it manually (say on paper, or via Excel), you can still use Turbo Tax Web, solely for calculation, comparison or verification purpose.

Retailer (where I buy the Turbo Tax software)

I think I paid about $82 for premier at Amazon.com this year. Today (02-02-2025) I saw Costco U city has $15 instant rebate on the top of that ($82). So next year I may buy from Costco instead of Amazon. For Amazon I download the software from their website: used to be Amazon, this year it’s Intuit the company behind Turbo Tax. I expect buying from Costco will be similar.

Do we want Audit Defense?

I got it last year – and I plan to continue to get it this year.

Some notes for me this year

eBay sent me a 1099-K. New for me this year. I am in the process of itemize the cost. This is more tedious than I thought initially. Here is some guidelines from Turbo Tax, btw. I may end up doing it as business too (see Uber below).

(Update 02-24-2025) I did more reading, mainly from

A Tax Filing Factsheet for eBay Sellers (Turbo Tax) and What to do with Form 1099-K (IRS). I decided to go with the Schedule C route (Below Uber is similar).

In my personal opinion, this approach is better than the other Form 8949 approach as implicitly suggested by the Turbo Tax.

Uber driving is also new to me. didn’t send me 1099-K as I didn’t meet their income threshold of $5,000. I mainly followed this Turbo Tax knowledge article as well the Turbo Tax Desktop Premier for this. I took the mileage standard deduction: used the online miles. And I used the tax summary from Uber (available in the Uber Driver App go to Account => Tax Doc) for the online mileages. Overall I am quite happy with the milage deduction (business expense, schedule C).

Summary for reporting taxes for eBay and Uber: again this is new to me. I learned two things: 1) Schedule C for business expense, reporting etc; 2) Refer to IRS website and their document as needed. In the past I mostly rely on Turbo Tax, or google. This time around I still use google, but Google pointed me to the IRS website. It’s good.

Keep things in perspective on Uber driving: the number one priority is always your (driver) safety, passenger safety and overall happiness. Money or tax saving for that matter, should not be a priority compared to the things I just mentioned. It’s more like icing on the cake. The cake itself better to be good – otherwise say if there are too many lemons among passengers, I will quit. This should be applicable to many things in life too, your day job, your other side gigs, and so on. I know I probably say it from somewhat privileged view point – as I do have some savings that allow to me “don’t have to work” for a while, if needed. Again keep things in perspective, I have worked in the USA for almost 25 years. I am at a stage of winding down my day job (career for some more career minded people, no judgement from yours truly here). At the same time, I am thinking about what I want to do after my retirement from my day job. Hint: I posted some plan here. But again, this is subject to change without any notice – the main stakeholders I need to notify is my wife and kids. I want to make sure they are comfortable, and can still splurge as they choose so.

Stocks: one of my favorite topics :-). For my 2 small regular brokerage accounts anyway: one again I traded too much and don’t have much gain to show for. So that’s my main lesson – I need to stick to the winners and hopefully stay away from the losers all together 🙂 Majority of my money (401k, HSA and 529 plans) are in S&P 500 index funds or equivalent. I do have two IRA accounts too: and I trade stocks there, and I am very pleased to announce that my luck there is better than the “2 small regular brokerage accounts” 🙂

State filing is included in the Turbo Tax desktop. One thing I noticed is 529 plan can save some state income taxes. (02-25-2025) Just realized the e-filing for the state is $25 or $40 extra. I decided to file via paper to save that money. (Update 03-04-2025) I sent the state filing tax via USPS mail. The postage is about $3.43 + printing cost which is about 8 cents x 42 pages = $3.36. Total is about $6.79 which is a bit cheaper than about $20 e-filing via Turbo Tax ($25 plus $5 off offer from couple of my Chase CC).

Some Odds and Ends

Probably more than 20 years ago, I recall my big boss has an Excel spreadsheet for tax filing, and he offered to co-workers. I didn’t take the offer. I think it may be a cheaper and better option, but I already fell into the Turbo Tax rabbit hole.

There is a common American saying: only death and taxes are certain 🙂

Other Choices

FreeTaxUSA.com

HR Block

TaxSlayer

Full Disclosure:

Not tax advice. Please consult a professorial tax advisor (an accountant, or a CPA) as needed.

I don’t receive any compensation from Turbo Tax. And I don’t have Inuit $INTU individual stock right now (02-26-2025). The reason I say individual stock is I do have S&P 500 index fund, and I assume $INTU is in the S&P 500.

(Update 03-04-2025) YT: Mass IRS Layoffs — How It Affects Your Tax Refund & Audits! by ClearValue Tax

(Update 03-05-2025) The Tennessean: 2025 tax season off to slow start amid federal layoffs, hiring freeze. Will refunds be affected? What to know

(Update 03-11-2025) Filed and accepted on Tue, Feb 25 – I just saw refund money hit the bank via DD 🙂 Total is about 2 weeks.

Categories
401k and Personal Finance

Tax day and turbo tax software

Reading Time: 3 minutes

Tomorrow 04/18/2023 is the tax day in the US, the usual deadline for filing federal income and state income taxes. Note in some states there is no income tax. In the old days, I mean the real good old days, the tax day is usually April 15, and the Post Office will be like the last few days approaching Christmas, because the IRS (Internal Revenue Service) and the state authority that collects state income taxes usually go by the post mark.

But I have done tax using Turbo Tax since year 2001, to be more specific I used Turbo Tax online version from 2001 to 2021 (for tax year 2000 to 2020), and I used the Turbo Tax desktop for tax year 2021 and 2022 (the one that’s due tomorrow April 18). If you search this blog website, you may notice that I talked quite a bit about Turbo Tax, most talk was before 2012 or so though.

Turbo Tax Online

I still remember the 1st time I used Turbo Tax online, I was on the phone modem, not the cable or AT&T broadband. And I remember the modem dial-in noise. I think I shared quite a bit coupons, tips and tricks using the Turbo Tax online versions, and sometimes I even got some sort of query from the authority. I think since that time, I don’t always use the Turbo Tax online version for state taxes filing. In terms of discount, in recent years, I sometimes using the offers from credit card. This is applicable to the Desktop tax filing as well. The online version has one advantage compared to the desktop: there will be a copy stored at Turbo Tax website. For desktop, we need to be mindful of backup, as I made a bad mistake last year.

Turbo Tax Desktop

I usually buy the desktop software from Amazon (here is my Amazon Associate link): note I usually buy the premier version (same for the online version).

For tax filing, I usually made 2 purchases: one is the audit defense ($45) and another is the state e-filing ($20 last year, $25 this year). And I used the Chase credit card $10 off offer for both.

Again, last year I forgot to make a backup copy, and this year I made a conscious effort to make backups in a safe place. Last but not least, if one does not have the copy for tax filing, IRS does have a copy and we can get to it after doing some verifications. Note the Adjusted Gross Income is needed for e-filing, and here is how to get it How do I find last year’s AGI?

Last but not least, I know some people like to push the can down the road, personally I am thinking it’s best to get it done by deadline. Regardless, we need to make approximate payment to avoid the penalty from IRS and the state revenue department.

IRA

I mean traditional IRA. The IRS website: 50 and above catchup, and Fidelity Q&A have some good information (…..however there are income limits for tax deductible contributions……).

One tip and one story

Make sure you pay the approximate tax before tax day (or better yet, anytime before tax day) to avoid any penalty or interest charges.

I used to have a coworker, and he said he got tax refund every year. And I commented why let Uncle Sam use your money for free for a year? He said: if he got all this money over the year, his wife would spend it. With Uncle Sam saves the money for him for a year, now that he can family for the summer vacation 🙂

PS: (update 04-25-2023) I received the refund from Uncle Sam. And I just realized the show me state withdraw from my provided bank account (again) for the owed tax one more time after I paid it on 04/18/2023. I assume they will send me a check or something down the road. Note I paid online earlier for the fear of any potential penalty etc. 🙂 A side note is I received a mail from Uncle Sam for creating the online account I mentioned above.

(Update 05-16-2023) NPR: The IRS is building its own online tax filing system. Tax-prep companies aren’t happy || I agree if IRS has a program that works out, it’s a win for the US tax payers 🙂

(Update 06-09-2023) It looks like the Show Me State is refunding me the tax over-payment. I paid it twice towards the tax deadline in April: I was doing it out of caution to avoid any potential penalty. I paid online before the deadline, and they (MO Dept of Revenue0 withdrew a similar amount based on my #turbotax filing. One nice thing, they even refunded with interest 🙂

Categories
earning Fun Video

EBITDA explained to children

Reading Time: < 1 minutecourtesy of CNN UK (CNN video link no longer available, here is a text link on LinkedIn, LinkedIn registeration needed): translating financial jargon into plain English, CNN’s Jim Boulden tackles EBITDA and a classroom of children.

EBITDA stands for earnings before interest, tax, depreciation and amortization.

Continue reading “EBITDA explained to children”
Categories
Stocks

E-File Tax for Free

Reading Time: < 1 minuteFrom Yahoo, this is the link, by Dory Devlin:

My take on this: if your tax situation is straightford, go ahead and use the free software. But on the other hand, if you buy and sell stocks, have a home business, changed jobs or moved last year,…you will be better off use the paid version. Another catch is the AGI (adjust gross income) requirement (less than $52,000).

(Update 22Feb07) I got my state tax refund today (filed by mail about about 10 days ago). I used Turbo Tax for federal (got 15% off through ADP) and it took about the same time to get refund. Prepare your tax early, even if you need to send in check (you can always hold it by mid April).