TaxCut Cuts Through the Jargon

Just about anything that relieves the pain of taxes is a welcome thing. And while H&R Block’s TaxCut Premium Home & Business 2003 can’t remove that desolate feeling in your wallet, but it’s a powerful tool for calculating and filing taxes that is worthy competition for Intuit’s TurboTax. This year’s program offers stronger assistance and advice and does a better job of walking you through that taxing process. It also offers strong ties with H&R Block’s tax services.

Not by the Numbers, In English
TaxCut offers a helpful interview that steps through the complicated tax preparation process by asking understandable questions. It presents intuitive screens, not cryptic electronic tax forms, to accept your financial data. The language is plain English, not legal- or account-ese, which makes taxes less difficult to understand. In the past, TurboTax offered an easier and more thorough interview than TaxCut, but the difference is no longer as great.

Throughout, TaxCut serves helpful tax advice. New “Plain Talk Tax Tips” dispense useful advice on subjects such as saver’s credit, bunching deductions, overlooked deductions and handling student loan interest, tip income and more. While the advice is comprehensive and impressive, TurboTax sometimes offers more detail, particularly when it comes to more obscure tax topics.

New features in TaxCut help address specific tax issues. There’s a calculator for estimating alternative minimum tax while another shows how to claim a dependent college student and handle tuition expenses. There are also modules for applying investment income, finding out more about restricted stock and offering guidance on capital loss carryovers and wash sales. A new tax payment planner estimates your 2004 taxes and your recommended withholdings.

The interview in the Home & Business version handles Schedule C, offers assistance on topics such as depreciation and business expenses and provides business forms for corporations (1120 & 1120), partnerships (1065), payroll returns (940 and 941), non-profits (990) and estates. There’s also an assistant that helps determine if your home office qualifies as a tax write-off, as well as business FAQs & guidance, a depreciation calculator and a helpful tax planner that projects business earnings and tax liabilities over the next three years.

TaxCut also helps you determine taxes on vacation homes and rentals. A useful IRA Advisor assists you in making the choice between a Roth or traditional IRA. The program also prepares a personalized tax-planning report that shows the effects of tax law changes on your return and offers advice based on your occupation and financial situation.

In addition to helpful multimedia videos that explain many tax concepts, the program offers a library of useful publications, including Kiplinger’s Guide to Investing Success; Buying & Selling a Home and Kiplinger’s Retire Worry-Free. This year, if you like, you may use a credit card to pay your balance to the IRS. Note however, that you will be charged an extra 2.49 percent “convenience” fee.

Easier to Use
The program sports a redesigned interface that is more intuitive and easier to use. In particular, the new Topic Navigator gives you a better idea of where you are in the tax process and helps you get from one part of the return to another. This way, if you’re near the end of the tax preparation process and discover a deduction that you forgot to enter earlier, it’s easy to go back and make the change. New “Get Ready” screens help prepare you for each return’s section by telling you what financial information and documentation that you’ll need to complete the section.

If you have further questions, H&R Block lets you consult with one of its tax professionals via phone or e-mail through its H&R Block’s Ask A Tax Advisor service. For TaxCut Premium users, the service is free (with a mail-in rebate). For Standard and Deluxe users, the service is available for $19.95. You can also have your taxes reviewed by a professional via H&R Block’s Professional Review service at extra cost.

TaxCut imports personal financial and tax information from Microsoft Money and Intuit’s Quicken, as well as other programs that support the *.TXF file format. The program also downloads data from H&R Block DeductionPro, a program that tracks charitable deductions, and from last year’s versions of TaxCut and TurboTax.

Test Drive
I had no problems installing the program from its CD onto my test system. The program made it easy to jump right into the interview and provided clear and easy options for successfully downloading data from Quicken. I found the interview to be clear and fairly easy to understand (this is taxes we’re talking about here), and I enjoyed the new option that let me jump around the interview.

TaxCut offers excellent technical support, though it only addresses software issues and can’t offer advice on tax laws. Free customer support via phone, e-mail, and chat is available Monday through Thursday, 8am-10pm EST and Friday – Sunday 9am-6pm EST. In addition, H&R Block promises to answer all e-mail queries within 48 hours. In my evaluation, I received a timely e-mail response. (Keep in mind that this was far before the late March/early April crunch time.)

The company also offers Priority Technical Phone Support, which charges $9.95 per call. Priority Phone Service is available Monday through Thursday between 8:00am and 10:00pm EST and Friday through Sunday between 9:00am and 6:00 pm EST.

In addition to Premium Home & Business and Premium versions, TaxCut comes in Deluxe and Standard versions. Premium contains all of the features found in the Deluxe and Standard versions. Deluxe has all the features of the Standard version, plus a single federal electronic filing and a TaxCut state program (after mail-in rebates), IRS publications and the Tuition Assistant. At all comparable levels, TurboTax is more expensive than TaxCut.

I definitely recommend the TaxCut programs for you hardy souls who want to do your own taxes. Keep in mind that the programs are clearly designed for the smallest businesses and consumer users.

TaxCut Premium Home & Business 2003 is available for $49.95 (MSRP). TaxCut Premium 2003 costs $29.95 (MSRP) after a $10 mail-in rebate. TaxCut Deluxe 2003 costs $19.95 (MSRP) after a $5 rebate. And TaxCut Standard 2003 costs $9.95 (MSRP) after a $5 mail-in rebate. The programs are available on CD-ROM or as a download from the H&R Block web site. With the download versions, you do lose some multimedia features.

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