Free Tax USA

And my 2023 taxes are done! Because I’m a simpleton with only a W2 and a 1099-INT (from a savings account), filing taxes is always an under 30 minutes procedure. I’m obviously not a target customer for H&R Block. I can appreciate paying for convenience - in having a guy or gal do your taxes - but 30 minutes out of a weekend is not so detrimental.

What is detrimental is last year’s interest income. Because of historically high interest rates, the return from my savings account in 2023 was very healthy. That means I have to pay capital gains tax on that return, of which I am happy to do so, of course. It’s truly a first world problem if you’re complaining about having to pay a lot in capital gains tax. Though I do feel kind of icky about having to pay taxes on income derived from money I already paid taxes on.

The problem with having high interest income is that I no longer qualify for free filing with TurboTax. Apparently: interest income over $1,500 requires a schedule B form (which if you’re using a tax-filing software you shouldn’t have to care what that entails). Because of this one single extra form, TurboTax automatically asked me to upgrade to the paid Deluxe version. I went from free-filing for both Federal and State, to needing to pay over $110. Absolute vultures.

I’m not paying that in this economy. My friends turned me on to FreeTaxUSA, an online tax-filing service of the same ilk as TurboTax. The main difference here is that FreeTaxUSA doesn’t give its customers the bone. Federal tax filing is always free under (I am assuming) most circumstances, and it’s only $14 to file State taxes (compared to $59 for TurboTax). This is what friends are for: saving you $100.

Somewhat tangentially: I am honestly sick of seeing corporations raising prices because of “inflation” and “war in Ukraine”, then three months down the line say they’ve got a record profitable quarter. I endeavor to do as little business with such businesses as possible.

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Death and taxes.

Happy tax day

A very happy tax day to my fellow Americans. I hope you’ve either paid your taxes or have filed an extension.  

If on the other hand you’re due to receive a hefty return, congratulations! You’ve just loan money to the federal government with zero interest for one whole year. With savings accounts (finally) paying in the two percent, it’s financially better to owe taxes at the end of the year than getting a sum back. I adjusted my W2 deduction accordingly so that I owe a small amount at tax time.

Obviously, what other people do with their money is none of my concern (as long as you don’t ask taxpayers to bail you out of anything), and I recognize that for some, having a sizeable tax return is a good mechanism to enforce a savings habit they wouldn’t otherwise have the discipline to implement. But that only works if those same people don’t then go spend their tax return completely, rather than storing it in a bank account. I’m afraid not that many actually do that.

2018 is the first year of the Trump tax cuts, and from that perspective I have to say it’s been awesome to keep more of my earned money. We’ve all been getting slightly more in take-home over the entire year, so my actual burden come tax day is more or less the same as before. That is, if I hadn’t bought the GT3.

In order to pay for the 911, I had to sell a large portion of my investment account holdings. Thanks to the bull market that’s going on its second decade (one wonders how long that will last), the returns were quite good, which meant one thing: capital gains tax. I won’t go on a diatribe about the unfairness of taxing capital gains, but let’s just say I think it’s wrong to tax money that has already been taxed upon.

Anyways, having to pay capital gains meant my tax bill was considerably more than usual, so naturally I waited until the last possible minute to file. My parents also had to pay taxes, so yesterday I filed both of them in one go. Say what you want about TurboTax lobbying congress to keep their pseudo monopoly on tax filing services, but at least their software is super intuitive and easy to use. Additionally, it was absolutely free for my parents to file both Federal and Stat, so honestly I can’t ask for more.

I’ll see everybody again next year; same time, same place.

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Whale tail.