Before graduating to full adulthood, I was terrified to do my own taxes. I wouldn’t even consider the idea. In fact, I felt like there was no way I could understand the process and no way I could get it right. Essentially, I thought I would end up being audited and thrown in jail if I tried to do any such thing. Do not pass Go, do not collect $200. You screwed up your taxes and we’re throwing away the key. False. This was my thought process throughout my entire 20s. Then I hit 30, split up with my fiance, and was starting my life over in an empty apartment with 4 lawn chairs. That’s a story for another time. You can actually listen to it here. The point is that when I re-booted my life, I had to start from scratch and I didn’t have extra money to go pay someone else to do my taxes for me, like I had done in the past without a second thought. I had 4 lawn chairs to my name for god’s sake. I had to figure everything out on my own for the first time in my life. I did. And it was totally fine.
NOTE: I am not being paid a dime to plug TurboTax. It’s just the program I used. And, it worked great for me.
I Had An Idea
As I sat there alone in my dank apartment with my W-2, I got an idea.The idea was to attempt do my own taxes. Or, at least plug in the numbers and see what happened. Ever since I started earning an income at the retirement home, followed by McDonald’s, and so on, I had been going to a place like H&R Block and paying them to do my taxes. Looking back, it seems silly that I paid hard-earned money to people who were just, in essence, typing my numbers into an automated program like TurboTax. Granted, this was before TurboTax and similar programs were common amongst DIY tax people. That makes me feel a little less embarrassed. But as the years went by and I earned more and more money with fewer and fewer deductions, the cost of having someone do my taxes for me was starting to irritate me. The cost was easy to overlook when I was still with my fiance, but now that all living expenses were on me, I had to do something. I didn’t want to pay someone >$100 to plug in some numbers. I was a smart person. I could do it. And so I did.
So, one night in February I had all of my tax documents in front of me at my corner desk in the apartment – I had bought myself some furniture at that point. I started to search the wonderful World Wide Web for tax laws. I read forums about doing your own taxes. I took notes. I looked at the breadth of my taxes. In retrospect, it was silly of me to be so intimidated. After all, I was single with a W-2 income and some student loan interest to deduct. The one thing I did have that was scaring me was my rental property. How could I possibly know what to do with that? No matter, I went for it. My thought was that I didn’t need to actually submit anything. I was just going to plug in the numbers – like they did at H&R Block and see what comes back. Then I can go to H&R Block and have it done by a professional. At least it would give me a good idea as to what my refund was going to be.
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I finally decided to go for it. I logged onto TurboTax.com and made a profile. I followed the prompts and started plugging in numbers. Then it came to the rental property. I pulled out my little ledger that I had been using all year to record my expenses. I plugged in all the numbers the program required, including PMI, mortgage interest, and property tax information. I also entered the annual amount I had spent on upkeep and maintenance. I was prompted for Every. Single. Line. Item. Easy peasy.
At the time, I was having extra taken out of each paycheck to make sure I wouldn’t actually owe the government anything when tax season rolled around. I know that might sound absurd to some folks, but you have to remember I was single and didn’t have anyone else to back me up. Not only was I supporting myself, I was also subsidizing my mother’s living expenses at the time (to the tune of $800/mo). I didn’t have any room for financial error. Per my perspective, a lot was riding on my shoulders. Hence, the need to try to save a dime by doing my own taxes.
Finally, everything had been entered and TurboTax had an enticing return staring me in the face. If I just submitted it, I could have it electronically deposited into my account in about a week. But no, I didn’t trust myself. I just did it to see what my refund was going to be. The plan was to exit out and still go pay to have it done by the professionals. But why would I do that when I could just submit the information and get my refund without paying anyone a single dollar? Because, again, I didn’t know what I was doing. Did I? No. The answer was no and I was going to cancel it. But wait, I was a smart person. My taxes were pretty vanilla, with the exception of ONE rental property. And TurboTax made me feel like I had entered that correctly, too. It was truly a moment when I had tiny, opposing, invisible versions of myself sitting on each shoulder pushing me to make a decision. Decision made. SUBMITTED.
I did it. I did my own taxes. And I felt powerful. I conquered something I never thought I could ever do on my own. I also thought I could never live on my own or start my life over at 30, but I was doing that, too. It’s funny how much you can accomplish if you’re forced into a situation or you start expecting more of yourself. My driver was saving money. I saved money that year. But, more importantly, I also grew as a person. I defeated a fear I had my entire adult life. I continued doing my own taxes using that same online program for years after that. It served me well and saw me through a daughter and a second home purchase.
This year will be the first year that I will not be doing my own taxes. The reasons are many. Mainly because I’m now married to someone with a somewhat complicated business. Although I feel extremely comfortable with online DIY tax programs for “normal life stuff”, I don’t feel so confident about getting everything right with his multi-faceted business. This year, we will be paying a professional.
But, if you’re a Millennial or a Gen-Xer who has nothing out of the ordinary and has never done your own taxes, I say shake off those fears and go for it.
Note: Houses, spouses, and kids (oh my!) are not out of the ordinary.
Believe me, you are probably smarter than you’re giving yourself credit for; it’s likely a lack of confidence that’s holding you back. Make up your mind and believe you are smart enough to navigate an online DIY tax program. You can tackle it the way I did – just try it. If you feel you didn’t do it right or the refund amount is grossly out-of-whack, cancel it and go to a professional. What have you got to lose?
What are your thoughts on DIY taxes? Are you considering it?
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