How can you have different refund amounts on taxes by using different preparers??

Question

hr block vs. jackson hewitt vs doing it yourself. Deductions are Deductions??How can one company get you more than another???

Answer 1

Taxes are not that cut and dried. There is enough leeway in the tax law as to how various expenses are treated, that different preparers get different tax amounts.

For example, let's say you have rental property and you pay property taxes on this property. You have a choice. You can include these taxes as an itemized deduction on Schedule A; or, you can put these taxes on a Schedule E. Generally Schedule E works out better; but , you can choose the other form.

For another example, let's say you have a business and you file a Schedule C to record the income and expenses. Some expenses that are not deductible for an individual ARE deductible for a business. If the use of a car is necessary in the business, car insurance, gas, oil, repairs would all be deductible items for the business -- but not for you as an individual.

I worked for a CPA firm. One of our business owners had enough of his personal expenses run through the business (they were all legal treatments like the car insurance) that he ended up having a tax bill that matched mine, even though he had multiples of my income coming through his hands.

The preparer's knowledge of the tax law, the questions they ask to uncover possible overlooked items, and a willingness to try alternative treatments are all factors that result in different bottom lines.

Answer 2

No matter who does your taxes, they should all be the same. The only difference is if someone takes a deduction that the other either forgot or did not think was correct. Most of the packaged tax software on the market will give you good to great results with no tax knowledge. This takes most of the guess work out of your return if you have a fairly straight forward tax situation. If not, use a CPA to get the best results.

Answer 3

Some preparers get "creative" with the deductions. Unless you have a complicated return you're likely to be better off doing it yourself. If you do want someone to help you, Avoid places like HR Block, Jackson Hewitt, etc. Those people don't know what they're doing. They're people who went through a 2 week training and are making $8/hour to use turbo tax to do your taxes for you. Find a friend who has a good, trusted tax prep person instead.

Good luck!

http://www.personalfinance101.org/?utm_source=YH&utm_medium=link

Answer 4

If you have a fairly straightforward return, they should all be the same unless somebody messed up. But if you have a very complex return or own your own complicated business, there can be differences of opinion on tax law, and one preparer might take a deduction that another would not.

Answer 5

those that don't KNOW and UNDERSTAND and properly apply the law are bound to not get the BEST answer. Anyone can prepare yor tax return and file a legal refund claim. Knowledgeable preparers can make sure you pay the least (or get the biggest legal refund).

Enrolled Agent / Tax Advisor

Answer 6

there should be no difference unless one is filing for more deductions or credits than the other but for the same person it should be the same. Math is Math there is only 1 correct answer.

Answer 7

Usually one is doing it correctly and the other is not. Or their interpretation of tax law is different, which is possible.

More importantly, STAY THE HELL AWAY FROM JACKSON HEWITT.

There, just had to get that off my chest.

Answer 8

go with the guy that is giving you more!