Should I use TurboTax Live?

[Saturn V]

Greetings all,

I've done my own taxes since college days in 1986 and have used TurboTax products for about the last 20 years.  I feel very comfortable doing my own taxes and I like being in charge of gathering and inputting the data on my own time schedule.  However, I've been thinking about getting pro help later this year and for filing 2022 taxes next year.  This year we are refinancing our home with cash out, buying a commercial property that we will lease out, and I am also planning to start an online business.  Plus, I'm just a few years away from retirement.  I want to ensure that I file the 2022 taxes correctly with all of these transactions and also ensure that I'm making the right decisions to take advantage of all tax savings for the business ventures and for retirement savings.  I know most of the basics (401k limits, post-50 catch up contributions, etc.), but there might be some further fine tuning.  Plus, I'm new to business taxes.  Maye a financial advisor could help with some of this (and I'm starting to interview financial advisors), but I think that I can get a lot of good input from a CPA. 

I interviewed a CPA from a small firm who was recommended by a friend who has been providing some general financial advise to us.  The CPA firm charges a minimum of $500 to prepare the 2021 tax return, and this could be more depending on how many hours they spend.  

I am considering using TurboTax Live (Premier for 2021 [$169] and Business for 2022 [$199]).  That way, I can maintain more control over how long it takes to do my taxes and when I spend time on it.  Also, I always hate spending money on something that I can do myself.  Though I don't work in finance, I am an engineer and can readily understand what I read about the tax code.  I just don't know some of the tricks and want to ensure that I am fully leveraging to power of TurboTax.  Also, I assume that Audit Defense is an available option for the Live products.  I have bought this the last few years and it gives me a lot of peace of mind.  With the CPA firm, they have no such policy.  If I am audited, I would have to pay the CPA firm (at least $150/hr) to deal with the IRS.  

I think the Live "self-service" products (not the Full Service) may be right for me.  I can maintain control over the process, but get live help when needed and have a pro do the final review.  Also, I should be able to ask questions of this community, as needed.   I may not need Live for 2021 taxes, but want to get used to the process and take advantage of the feature that provides live pro help throughout the year.  I like the interactive process this way, since I will learn more and get to interface with more people, versus just handing all of the paperwork over to one CPA.  

Do you recommend Live for me?  Any tips on discounts on the Live products?  Thanks!

[tagteam]

You mentioned starting an online business which begs the question as to whether you plan to organize an entity (such as an S corporation, a C corporation or a multi-member LLC).

Be advised that there TurboTax Live (Full Service or otherwise) does not support preparation of income tax returns for the entities listed above; the service is only for individual income tax return preparation.

Further, you might find that you need the individual (CPA) in the firm to assist you with aspects of your business (and commercial property) beyond income tax preparation. For example, collection and payment of sales tax, maintaining books and records, etc.

[Saturn V]

tagteam, thank you for your response!  I am forming a single-member LLC.  So, with an LLC involved, you are saying that I cannot use TurboTax Live, but I could still use the other products for the LLC taxes?  I am hands-on and the business will be very small, at first, so I intend to handle all administration myself.  

[tagteam · Accepted solution]

@Saturn V 

A single-member LLC is disregarded for federal income tax purposes; it is treated virtually the same as a sole proprietorship which would file a Schedule C. 

As such, you would not need to prepare a return for an entity and could absolutely take advantage of TurboTax Live (including Full Service).

[Saturn V]

Thanks, tagteam!

[Ljjones]

Need to change email

[Ljjones]

Can not start my information.

[DanP0428]

TurboTax Live is out of scope for the type of planning you are need.  I would suggest working with a local tax preparer until you have everything accounted for your to-do list and then using TurboTax self-employed in the future.  With TT Live, you get the agent who answers the phone.  They may be very familiar with your question and able to help, or they may not have a clue and cause you more frustration.  

Every time you call Live you will get a different agent and a chance that they will be able to assist you.  Don't put yourself through that stress.  Go to a person who knows you and will not have to start over from scratch every time you have a question.