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Topic: H and R Block -- worth it?
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| Author | Message |
| pentup | Posted – 1/22/2005 11:53:10 AM | show profile I freelanced for about half of last year (worked a staff job the other half) and am debating whether or not I should go to H and R Block to a)prepare my taxes and b) give some guidelines on how I should deal with taxes now that I'm a full-time freelancer (like -- am I supposed to be paying taxes quarterly? How much should I pay? What sort of write-offs can I get for having a home office? etc.). When I called H and R Block, they said they wouldn't even give me an estimate of how much this service would cost me until I came in with all my info. Can anyone give me a ballpark idea of how much H and R -- or a similar service -- costs? Are we talking a hundred bucks or several hundred bucks? |
| Cyrus | Posted – 1/22/2005 12:05:25 PM | show profile I must preface this by saying I'm *NOT* a professional tax planner. However, I do my own taxes every year and I too have freelanced for years. My advise? Get a program like Turbo Tax -- usually the Deluxe version is enough for most people. It will walk you through an interview that will collect information about your tax situation and should give you your relevant deductions. It can easily handle things like home offices, etc. However, you should read up on the qualifications for taking that deduction and others from irs.gov. In a nutshell, use of the space has to be exclusively for business before it's deductible. Unfortunately, you can't just deduct the value of the space for the portion of time you use it. As far as quarterly taxes... if at the end of the year, the amount you've underpaid the government in taxes exceeds a certain percentage of your adjusted gross income, they'll hit you with a penalty. How much it will be will depend on your financial circumstances. Freelancers don't have to be sent a 1099 unless they earn a certain amount of money from a person (can't remember the threshold). But that doesn't relieve you of reporting the income, obviously. H&R Block didn't give you an estimate because it's hard to say how much time it will take until you show them your papers. You'll be looking at having a 1040 prepared, with several accompanying forms/schedules. There are separate forms to report income from a business and to take some of your deductions. I've always done my own taxes, but you probably will be able to get away paying only a couple hundred at most. My advice? By TurboTax and give it a whirl. It's not that hard. To help you, have last year's forms handy or call the IRS and ask for a transcript of last year's return. They're free. ------ Cyrus Afzali Astoria Communications www.astoriacomm.com |
| Poundsonkeys | Posted – 1/22/2005 1:11:27 PM | show profile Get a book like Taxes for Dummies from your local library, and check out the IRS website. They have a ton of information and instructions. The language they use is often confusing, and it's hard to find the right form(s), but it's free. I wouldn't spend any money on H&R Block unless you find yourself totally clueless even after checking out those resources. And the process could make a great article too! |
| foodlit | Posted – 1/22/2005 2:34:23 PM | show profile Turbo Tax is the best! I second this wholeheartedly. I've used it for years, and as a salesperson, it has been invaluable in helping me with deductions. It figures everything, and even lets me know where I rank compared to others in similar fields. So for instance, if a deduction is significantly higher or lower, it will alert you so that no red flags go up when you file. I work from home, so the home office deduction is huge, and Turbo Tax also keeps all your information from year to year, so you can compare against what you claimed last year. It is simple, and walks you through everything, and then you hit a button and file instantly. |
| Wiley | Posted – 1/22/2005 3:11:11 PM | show profile There are accountants who specialize in preparing taxes for freelancers. My accountant even specializes in freelance writers, since he also is a writer (newsletters, speeches, etc). I've used him for seven years, and he has saved me and my family thousands of dollars. Be aware that H&R Block and the rest are OK, but you won't necessarily find anyone in those places who specializes in self-employment/freelancing. I don't know how much they charge; my accountant charges me around $400 on average to do taxes for my whole family (me and DH, son, daughter, also self-employed), but he's saved us thousands, so it's worth it. Plus, you can deduct the fee as a biz expense. Email me for his contact info, if you'd like. |
| pentup | Posted – 1/25/2005 6:52:38 PM | show profile Just realized that I posted this question and in the hubbub of the last few days neglected to check back. Thanks for all your great responses. I'm going to try Turbo Tax -- hope I can figure it out! |
| meccalis | Posted – 1/25/2005 8:25:05 PM | show profile | email poster DO NOT USE H and R Block I was in the NY Daily News a few years ago on how they screwed me. They never sent my taxes in and it sat in their database for months. I got a penalty. Also, they use students and train people off the street to do YOUR taxes. They are good for the 9-5 folks, but if you are a freelance or a creative person who does not have a ''job'' but your money comes in forms of advances, and royalty checks, etc....they are not for u. Better to go the private route and pay an extra few bucks for the peace of mind. |
| VillageGal | Posted – 1/26/2005 9:55:09 AM | show profile Avoid H & R Block Many years ago, they gave me such bad advice about deductions that I got audited. These guys are not specialists by any means They are like the McDonalds of tax prepareres Find yourself someone who knows how to deal with freelancers. |
| roja93 | Posted – 1/26/2005 1:41:47 PM | show profile And there are plenty of them in New York. Unless you feel like, and want to devote time to, following and understanding every permutation of the tax law, get an accountant. |
| Cyrus | Posted – 1/26/2005 4:11:00 PM | show profile While there are special issues that come with freelancing, it's not that complicated. Basically, there are a couple of extra forms used to report income/loss associated with operating a business. If you get TurboTax Deluxe or higher, the interview process will ask you this and take you through step by step. It's much cheaper than a tax prep firm and you get your money back quickly with no high fees. ------ Cyrus Afzali Astoria Communications www.astoriacomm.com |
| VillageGal | Posted – 1/27/2005 8:57:21 AM | show profile Time is Money I'd much rather pay someone than do this myself. Ask around among your colleagues for a referral. |
| CrazyDaisy | Posted – 1/27/2005 9:08:19 AM | show profile H&R Sucks I agree. H&R is terrible. Stupidly enough, I've used them three times since I've been in New York, but never again. First time they misreported my income so I missed out on $800 the government owed me. Second time was fine. Third time, the preparer made a mistake on my filing status, my resident status and on the source of one of my incomes. I didn't catch these mistakes until it was too late (because she filed electronically) so I had to refile. H&R is in fact the McDonalds of tax preparation and they will get you in deep deep trouble. |
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