TurboTax, TaxAct, Proseries, Fishback Tax & The Story of a Simple Partnership Return

Being a CPA by trade (although I work in industry now), I should have a simple problem to solve: filing a 1065 partnership tax return. And not just filing any partnership return either; it is a terribly simple rental property jointly owned in a LLC with one other partner. This should be Lindey Lohan easy.  

In prior years, this filing was done using the professional grade, super-duper kick ass Intuit ProSeries software. Everything about the software I loved other than one key thing: the cost. It’s a costly piece of software for someone that does not do a high volume of taxes professionally.

The basic version cost $279 and then each return cost $49 for the federal with an additional $29 for the state return. Several years ago I was filing 5-6 returns for friends and family that made this palatable but now I’m not. This put me on the path to searching for a less costly alternative. The cheapest option would have been to file the return by hand using paper forms but then I would have to type up the K-1 letters and risk numerous typos. Huge pain in the ass. I wanted to find software to do it.

First I evaluated software for my personal tax return and came to the conclusion that Intuit TurboTax with their top-of-the-line home and business package would be best because in 2015 my wife still had her consulting business. Since it’s also an Intuit package, I figured in the future years if I wanted to convert back to the Proseries version, it would be fairly seamless. The home and business package cost $79.64 over at Amazon with one state download included (always buy it through Amazon and not directly through Intuit). Included in the software cost is five free federal filings plus one state download. If the software is required for additional states, that is $39.99 plus the filing fee of $19.99 per state.

Shame on me but when I purchased this, I didn’t read the fine print and assumed that with “business” in the title, it would also have the ability to file a partnership return. Perhaps for an additional fee, but still have the ability. Wrong.

If you want to file a Partnership 1065 using TurboTax you need to additionally purchase TurboTax Business. Notice no “home and” before the business there!! Just a tad bit confusing.  

The cost for the TurboTax Business at Amazon is $119.99. At that point I was frustrated about having already purchasing the other software so I decided to expand my search and look for other options.

I had recently just read a Mr. Money mustache article talking about him paying to have his own taxes filed. Now this is something I would have never, ever considered since:

A) I’m a CPA

B) I think it doing your own taxes
provides an understanding of where you are financially

C) It costs money!

But he mentioned a company called Fishback Tax. Fishback Tax is basically an online accounting firm providing tax filing, including partnership returns, for a flat rate of $100. Being a CPA and having charged for returns in the past, that rate is pretty amazeballs. Out of curiosity, and the cost of their promised service being below the price of just the software I needed to file the return, I decided to check it out and give it a shot.

On their website, www.fishbacktax.com, I signed up (February 20) and the next day they emailed me access to private portal where documents could be uploaded into their system. I uploaded my prior year return as well a complete proforma P&L for the rental.

Add cricket noises.

There was no confirmation or response from anyone that the documents has been received. On March 2 I decided to follow up since not having the K-1s was preventing both my partner and I from moving forward with our own taxes. The did respond that day and told me that it would be 2 to 3 weeks before someone would reach out to me to follow up on the return. As of March 17, I have still not heard back from anyone.

Since this is holding up two people’s return (including my own), this level of customer service is not going to cut it. The slow response time was also not giving me much confidence in their overall service quality.

Back to the drawing board once again. I should’ve reevaluated my just doing this by paper for free but it still seemed like a pain in the ass. Plus, I still had the itch to try something new just to evaluate a new process or software.

One thing that has been around for years now that I had yet to try was a purely online tax preparation software. Everything I had tried to this point has been a downloaded desktop version. All of the major software providers offer such as service so I priced out the different packages online and found the TaxAct online package was fairly reasonably priced ($49.99 plus an additional $19.99 for the state return) and it was TurboTax’s competitor. That would give me a different perspective on their packages.  

I’m not sure what I was expecting since was my first time using a purely online service but I’ll it was pretty awful.

Right off the bat, there was no import ability for anything other than a prior year TaxAct file. This is in stark contrast to the TurboTax’s desktop version that can import a prior year return even from a .pdf (including a scanned paper copy). The pdf import method is far from perfect but it does give a basic starting point.

After you get past manually typing in your basic information, the navigation is difficult. The software tries to simplify the process by providing a step-by-step process to follow but they don’t simultaneously provide functionality to jump around through the return. At no point can you switch from step-by-step to form view even after the service is paid for. Not having a form view makes it difficult to review the return compared to prior year returns or to quickly adjust for mistakes that might have been made.

I was able to fight through all the crappiness finish my return. The return was so simple that there were no major issues but I would have hated to work through a more complex return with this software. But the mission was complete, it was cheap (all in for the filing it was it $69.98) and the return is filed.

Although it was a headache, when the dust settled I saved $242 across all the returns I filed (2 individual returns, one partnership, across 3 states) compared to the prior years Proseries cost. That’s some real coin so although this was not a smooth process, it’s one that I’ll probably repeat next year.

The Wealthy Accountant

Once again big thanks to Mr. Money Mustache (the best best early retirement blog out there if your interested) for introducing me to The Wealthy Accountant.

See a secret desire of mine is to both actually retire early and to have a CPA practice on the side (if having both can be done simultaneously). The Wealth Accountant seems to have achieved both and has some great information for tax geeks and early retirees. If you’re interested in getting your tax geek on, go check it out.