Witholding Options

It's tax time and I am frustrated again. The most frustrating part of doing taxes every year is Intuit's Turbo Tax. This company is nefarious and devious in their ways. Each year they manage to raise the Bar of Evilness. In this year's product, they attempt to trick you into letting them use your personal tax information for their own devices. Why do I say they try to trick you? Because instead of saying "click here if you want to allow us to use your tax return information to spam provide you with other fantastic offers" it says "click here to allow us to show you more options to get your refund". I'm not making this stuff up. Of course you are tempted to check the box. Who doesn't want more options? Who wants to "miss anything"? I bet most people will click on the box, and then it disappears before they even have time to realize what they have done.



Here is another blogger who more rants eloquently about the situation.

Please Consult Your Tax Advisor

I am completely sick of advertisements that say "please consult your tax advisor".

First of all, these companies are just making this disclaimer so they can say anything they want in their marketing campaign. "HOME EQUITY LOANS - FULLY DEDUCTIBLE" (to determine deduction eligibility, please consult your tax advisor)


Newsflash: We are normal people! We are not rich marketing executives. I do not have a team of advisors. The only advisor in my house advises me twice a week to take out the trash. I have never had a tax advisor. And if I did, he'd charge me an arm and a leg to find out that your scheme is not tax deductible because I am not blind and disabled. I don't even know anyone who has a tax advisor. (The guy at the mall who, once a year, charges you $150 to punch your W-2 into a computer does not count).

Search for "consult your tax advisor" on the web and you will get 694,000 hits. All of them are people trying to sell something to us that we are not smart enough to understand. I am going to start selling a set of car tires that are guaranteed to last for 300,000 miles. I will include a disclaimer that says "consult your hydrocarbon polymer engineer".

Flexible Savings Accounts

If you get health benefits through your employer, you may be familiar with a horrific thing called Flexible Savings Accounts.

The first thing you realize about Flexible Savings Accounts is that they are not at all flexible, they do not represent savings, and they are not accounts. It gets worse from there.

The idea of the FSA is that you should not pay taxes on earnings that you earmark toward out-of-pocket expenses for medical care. But since you cannot be trusted, the government decided that you have to GUESS at the beginning of the year how much you will spend. If you guess wrong, you lose the money. So sorry.

The following are the simple steps you need to perform to save money with a Flexible Spending Account:

1. Take a wild guess how much your family will spend out of pocket on medical care next year. Warning: Do not guess wrong or you will lose any extra money that you guessed over the actual amount.

2. Let you employer hold some of your paycheck aside, so you can possibly be reimbursed later.

3. Fax receipts and claim forms with all of the details of your medical expenses to a claims administrator. Warning: You must include all of the necessary information, or they will not give you back your own money (that they took in step 2 above). This includes date, provider, services provided, member name, amount, etc. Just imagine filling out a dozen rebate applications, and you will start to get the idea.

4. Wait and hope that your expenses are approved so they can give you back your money.

5. Any amount that you overestimated in step 1 above is donated to your employer at the end of the year. Any amount that you underestimated, tough luck because you can not change your election during the year.

6. Repeat the process, starting back at step 1 for next year.

Example: Suppose you set aside $200 in your FSA, you are in a 25% tax bracket, and by some miracle you guessed right and provided the paperwork to get all of your money reimbursed. Congratulations - you just saved a total of $50 on your taxes! (Try not to think about the fact that for all that time you spent you could have just gone out and mowed 10 lawns for $20 each.)

Enclosed Is Your Taxcut Software

It's tax preparation season, so it would be easy for me to rant about the crappy features in my tax software. But my dignity is above all of that, so I am ranting about the crappy marketing strategy of my tax software.

For the last 8 years or so, I have purchased H&R Block Taxcut software (formerly Kiplinger Taxcut). This year I was pleased when they sent me the following package, including the CD, at no charge:



As you can see, the package clearly says "Premium Federal + State", "Everything you need", "Full version", and "Enclosed is everything you need to complete your federal and state return". Let me repeat that last part again - "Enclosed is everything you need to complete your federal and state return". Right at the top of the package.

Why do I think they would give me the software for free? Am I some sort of idiot? Good question. I don't know. I thought maybe (1) they charge for filing the return electronically, (2) they give you the basic version and try to upsell you an upgraded version, or (3) they try to charge you for certain features, such as tax advisor or deduction pro.

Now, just in case the marketing people at Taxcut are a bunch of SLEAZY DIRTBAGS who LIE and COMMIT FRAUD I decided to load the software in February to make sure I indeed had "everything I need to complete my federal and state return". Sure enough, I loaded the CD and it took me to their website where I could buy the software for $19.99. So the package that they sent me contained precisely nothing but a pointer to their website (you have to download updates to all of the files after you purchase the software anyway). So I went to ebay and bought the software for $0.01 plus $3 shipping.

The people I feel sorry for are the poor souls who load the CD on April 14. They are stuck paying $20 (plus whatever it costs for State), with little alternative.

That really taxes my patience.