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Monday, April 25. 2005
The Happiest Time of The Year
For the majority of people, tax season is a time of distress and anxiety. Ironically, for me, it is one of the happiest times of the year. I actually look forward to tax season because of the nice tax return that follows. As a student, I hardly pay any taxes.
Anyways, I submitted my taxes a few minutes ago. This was the first time that I actually did my taxes online. For those who know me, you'll remember that I was a die hard paper-and-pencil tax guy, who refused to do taxes online. For online taxes, I really didn't like the idea of putting in numbers into a magic blackbox, and out the other end is what your tax return was. I wanted to know how each of those numbers were calculated and why, so that's why I did my taxes by hand. I also thought it was dumb how you had to pay money in order to file taxes online, it's especially stupid if I can do my own taxes.
So, I finally bit the bullet and gave online taxes a try. What swayed me was simple economics. By paper, it would take around 6 weeks for my tax refund to come in, as opposed to 2 weeks. That's a 1 month difference, and that's a lot of interest from investments lost. In addition, the faster I get my money from a corrupt government *COUGH* LIBERALS *COUGH* the better.
I started my quest for an online tax service by going to the Canada Revenue Agency site, where they had a list of tax software packages available. I went with the web based ones because I didn't want to bother downloading and installing anything. For web based applications, all you need is a modern web browser to run them. I then looked at which tax service allowed you to file taxes for free.
T1Filer
The first one I came across was T1Filer which allowed you to file taxes for free if you made under $25,000. Great. So I checked it out, and I really didn't like it. The first thing is, it asks which forms you'll need. I didn't know off hand, so I ended guessing which forms I needed. Then it asks you to fill in the dollar amounts for these different forms. Some of the questions they ask are very vague, and the help section was awful. It also didn't provide any useful instructions about what to put in those boxes, even though the government publishes those instructions. The whole user interface was clunky. At the end of finishing my taxes, I noticed there were some errors with my tax return because the questions they asked weren't very precise. It also didn't provide any tips of how to optimize/maximize your tax return. So, I stopped using this one because I didn't trust the results it had generated.
UFile
The next one I checked out was UFile which was the one I ended up using. The price was right because if you earn under $20,000 a year, it's free OR if you're a post-secondary Canadian student, it's FREE. The tax service was a web based system. It had a very intuitive user interface. Each field you fill in has additional help if you need it, and extra help if you need to look up something in the official government tax instructions (very useful). It doesn't ask you what forms you need; rather, it asks interview questions like if you were a student last year, and it'll pick the forms that you'll need. It was a very easy to use system. It took me less than half an hour to finish my taxes. Furthermore, when you finish your taxes, it optimizes them for you, and gives you tax tips and adjustments in order to maximize your tax return. I learned a few tax tricks that I wasn't aware of before.
Conclusion
So, I finally decided to switch from pencil-and-paper tax filing to online tax filing. Using UFile was a breeze for preparing taxes. If you want your tax return quickly, online tax filing is definitely the way to go. If you're a student or if you make less than $25,000 or $20,000, there's no reason why you shouldn't file online because it's free. A reminder that taxes are due next week, so if you haven't started, you should do them now. I have an excuse for doing them so late, I had final papers to write
. If you've never done taxes before, it might be good to do them manually using the old fashion pencil-and-paper method as you develop an understanding of what's going on. How else would you know if your tax software screwed up your return or not?
P.S. If you do your taxes online, make sure you print out a paper copy of them just in case you get audited. Also, make sure you keep a digital copy of your tax files, and make sure you keep them somewhere safe.
Anyways, I submitted my taxes a few minutes ago. This was the first time that I actually did my taxes online. For those who know me, you'll remember that I was a die hard paper-and-pencil tax guy, who refused to do taxes online. For online taxes, I really didn't like the idea of putting in numbers into a magic blackbox, and out the other end is what your tax return was. I wanted to know how each of those numbers were calculated and why, so that's why I did my taxes by hand. I also thought it was dumb how you had to pay money in order to file taxes online, it's especially stupid if I can do my own taxes.
So, I finally bit the bullet and gave online taxes a try. What swayed me was simple economics. By paper, it would take around 6 weeks for my tax refund to come in, as opposed to 2 weeks. That's a 1 month difference, and that's a lot of interest from investments lost. In addition, the faster I get my money from a corrupt government *COUGH* LIBERALS *COUGH* the better.
I started my quest for an online tax service by going to the Canada Revenue Agency site, where they had a list of tax software packages available. I went with the web based ones because I didn't want to bother downloading and installing anything. For web based applications, all you need is a modern web browser to run them. I then looked at which tax service allowed you to file taxes for free.
T1Filer
The first one I came across was T1Filer which allowed you to file taxes for free if you made under $25,000. Great. So I checked it out, and I really didn't like it. The first thing is, it asks which forms you'll need. I didn't know off hand, so I ended guessing which forms I needed. Then it asks you to fill in the dollar amounts for these different forms. Some of the questions they ask are very vague, and the help section was awful. It also didn't provide any useful instructions about what to put in those boxes, even though the government publishes those instructions. The whole user interface was clunky. At the end of finishing my taxes, I noticed there were some errors with my tax return because the questions they asked weren't very precise. It also didn't provide any tips of how to optimize/maximize your tax return. So, I stopped using this one because I didn't trust the results it had generated.
UFile
The next one I checked out was UFile which was the one I ended up using. The price was right because if you earn under $20,000 a year, it's free OR if you're a post-secondary Canadian student, it's FREE. The tax service was a web based system. It had a very intuitive user interface. Each field you fill in has additional help if you need it, and extra help if you need to look up something in the official government tax instructions (very useful). It doesn't ask you what forms you need; rather, it asks interview questions like if you were a student last year, and it'll pick the forms that you'll need. It was a very easy to use system. It took me less than half an hour to finish my taxes. Furthermore, when you finish your taxes, it optimizes them for you, and gives you tax tips and adjustments in order to maximize your tax return. I learned a few tax tricks that I wasn't aware of before.
Conclusion
So, I finally decided to switch from pencil-and-paper tax filing to online tax filing. Using UFile was a breeze for preparing taxes. If you want your tax return quickly, online tax filing is definitely the way to go. If you're a student or if you make less than $25,000 or $20,000, there's no reason why you shouldn't file online because it's free. A reminder that taxes are due next week, so if you haven't started, you should do them now. I have an excuse for doing them so late, I had final papers to write
. If you've never done taxes before, it might be good to do them manually using the old fashion pencil-and-paper method as you develop an understanding of what's going on. How else would you know if your tax software screwed up your return or not?P.S. If you do your taxes online, make sure you print out a paper copy of them just in case you get audited. Also, make sure you keep a digital copy of your tax files, and make sure you keep them somewhere safe.
--Unknown