CBS Morning Program - Tax Challenge

[Yardley CPA]

Here's a video clip that appeared on the CBS Morning Show. CBS asked a couple to file their taxes three ways, Turbo Tax Online, H&R Block and at a local CPA.

One thing that struck me is the advice they gave that indicated arriving at your tax preparer organized and prepared would help save you money. So true! A client who comes to a meeting with me prepared with all their records in order definitely pays less than someone who drops off a shoe box of information.

http://www.cbsnews.com/video/watch/?id=7358568n&tag=cbsnewsLeadStoriesAreaMain;cbsnewsLeadStoriesHeadlines

[Gail in Virginia]

I am glad that the challenge came out the way that it did, but I would personally have been curious to have also compared an experienced, unenrolled preparer's fees and out come, and would have loved to have seen a mention of Enrolled Agents as an option.

[Kea]

But it is still a bit misleading because they didn't seem to rate the challengers on accuracy. They did say that HRB said they couldn't take certain business start up costs. So HRB cost more and had a lower refund than TurboTax. But it would still be the better choice (of those 2) than filing an inaccurate return. They did not address what the CPA found that the others didn't. Not that I would expect that in a TV morning news segment. And, a sample size of 1, is not statistically meaningful. Every tax situation is different!

I do agree that tax professions will generally produce a more accurate return than TurboTax, but that doesn't always mean it will have the largest refund.

[BulldogTom]

Kea hit it on the head. If the challenge was to get the biggest refund (regardless of accuracy) they should have included some preparers that the IRS busted for filing false returns. What they should have done is brought in the IRS to audit all three returns when they were done and see who really produced the best results.

Tom

Lodi, CA

[JohnH]

But that would spoil the drama, wouldn't it?

With all the media, drama wins out over reporting accuracy every time.

[BulldogTom]

No, that would be real drama. Wouldn't you just love to see the HRB preparer and the CPA sitting there with the client as the IRS auditor went through their return and asked for the documentation for all the deductions. How about a Q&A afterward asking how they were $1,300 apart on the refund.

What if both of them were wrong and the IRS had a completely different number after audit.

That would be "must see tv".

Tom

Lodi, CA

[JohnH]

Good point. The more drama the better.

[Terry D EA]

I'm glad it came out the way that it did as well. However, I do agree with Tom on all points. I also noticed that the female reporter mentioned that not all CPA's are alike as well. Best advice is research and find someone you can trust which is well worth the investment. Naturally if the fees are outrageous then one should question that as well. Being the most expensive doesn't mean you are the best at what you do.

[Gail in Virginia]

This is a hard field to compare value. Most preparers, me included, don't like to give prices over the phone because that simple return isn't, and unless someone you know recommends their preparer to you, I can't give you references that you can contact because I can't give out the names of my clients. And a lot of it is taken on faith - someone can sound knowledgeable, but unless you are equally educated in that field you really can't judge. And if you are equally educated, you would probably be doing your own return.

[jainen]

>>CBS asked a couple to file their taxes three ways<<

In my opinion this was a fraudulent news story. Obviously the taxpayers did not provide the same information to each service. They said TurboTax used the wrong form, which almost certainly means the TAXPAYER answered a question incompletely or inaccurately. They said the CPA provided more comprehensive planning services. Apparently a major issue was determining whether or not they were actually in business, a question with a big dose of subjectivity depending on the client's comfort level with a more aggressive tax position. H&R Block moved expenses into a future year, which potentially might mean much larger total refunds by offsetting SE income in a higher tax bracket.

How about we check the CBS Morning Show against competitors to determine the "best" way to get news?