Doing the Taxes

I'm currently working on my 2007 tax return. This will be a fairly complicated year for me. I have two W-2's, capital gains, dividend, and interest income like usual. This year I also have to include a Schedule C business (for the store my wife started up last year). and the income from her 401K withdrawal (capital for the aforementioned store). I had a pretty good chunk of capital gains this year, so I need the losses from starting up the store to offset them if I want to avoid a hefty tax bill. We itemized our deductions, and unless our AGI is too great, I get a tax credit for the tuition from my MBA program.

In past years I have used TurboTax, but this year's release is only compatible with Mac OS 10.4 and above. I have Mac OS 10.3.9. I was going to purchase the on-line version of TurboTax, but a friend who works for H&R Block got me a copy of thier Tax Cut software.

The first pleasant surprise was that Tax Cut was able to extract all of my personal information from last year's tax return, saving me from having to enter in the data by hand. I had assumed that Tax Cut would not be able to open the file created by TurboTax, but apparently both programs use the same file format.

Tax Cut walks you through the process in a fashion similar to TurboTax, so I would rate them as about the same in ease of use. TurboTax has a big edge over Tax Cut in on way, however. TurboTax has the ability to go on line and directly download banking and brokerage account information. This really speeds up the process of entering passive income like capital gains and dividends. I'm not done with the process yet, but so far I'd rate TurboTax ahead of Tax Cut.