Millions of Americans have strayed from professional tax services and begun preparing their own tax returns. Taxpayers are turning more and more frequently to online software like TurboTax, TaxAct, and TaxSlayer, often to avoid the expense or hassle of hiring a certified public accountant. These services are quick, easy to use, and totally safe—or so they say.
Taxpayers should keep in mind that tax season is one of the most popular times for people to fall victim to scams. As tempting as it sounds to save a few dollars and download one of these programs, they come accompanied by risks much more alarming than overpaying a CPA. Your personal and financial information are in danger of being seriously compromised. Without help from a trusted tax professional, your private data is subject to security breaches that could disrupt your entire life.
Fortunately for California taxpayers, the Roseville tax lawyers of NewPoint Law Group have over a decade of tax law experience and the knowledge and skill to handle any tax-related matter. Our professionals can serve all of your tax needs while providing you the peace of mind that unsecured online vendors cannot. NewPoint Law Group can assist with tax planning and help taxpayers legally minimize the amount of tax they pay. To schedule a free and confidential initial consultation, please call 800-358-0305 today.
Identity Theft in California
Online DIY tax software contains a treasure trove of personal and financial data. In order to use these vendors, users are required to input their full name, date of birth, social security numbers, and bank account information. Providing your social security number alone to an unsecured source can wreak havoc on your finances. An identity thief with your SSN will be able to open credit cards, take out loans, undergo medical treatment, file fraudulent tax returns, and poach your social security or insurance benefits. Identity thieves can go years without being discovered and some of their crimes are very difficult to detect.
With all of the recent technological advances, one might be tempted to think these online business kinks have been worked out. However, TaxAct recently reported that approximately 450 customers may have had personal and tax return information stolen, leading the vendor to freeze more than 9,000 customer accounts. TaxSlayer also reported 8,800 of its customers’ personal information may have been compromised.
California is no exception to identity theft rates. In 2014, 1.5 of the 12.7 million American victims were California residents. Unfortunately, there is nothing the consumer can do to prevent an online tax preparation vendor’s vulnerability to security breaches. The bottom line is that taxpayers who opt for the “convenience” of this kind of software are also placing themselves at serious risk for identity theft.
Missing Deductions and Over-Deductions
Not only are they potentially dangerous, online tax preparation vendors are often inaccurate. Without the help of a real-life professional to guide the process, taxpayers are likely to miss deductions or take the wrong deductions, costing you time and money. Using these vendors means allocating a substantial amount of time to the task, rather than hiring an income tax preparer. The Tax Code is very complicated and even challenging for some tax professionals to understand at times. Form W-2s; 1099 tax forms for independent contractors, interests, dividends, capital gains and losses; real estate taxes; and mortgage interest are all topics that the average taxpayer is likely to stumble over. However, an accountant or tax attorney is equipped with the knowledge to deal with these provisions.
Preparing your taxes online may not be enough even by using contemporary software. It can be difficult to ascertain whether you are qualified for a deduction by relying on a program alone. When the IRS spots an improper deduction on your tax return, you can be sure they will not ignore it. Basically, if you are depending on a tax refund and you did not file it properly, you might be waiting a long time to receive your refund. Filing without professional help means that it is your sole responsibility to file properly and you will be held accountable for any mistakes and omissions. Online help can be insufficient and even an innocent mistake could mean audits, penalties, and interest charges. Using a DIY vendor to prepare your tax return has its benefits as well as its drawbacks. If you have any doubts or concerns, it is best to seek advice from an experienced tax attorney or accountant.
Work with a California Tax Attorney Today
Taxpayers in California should be wary of using an online vendor or software to prepare their tax returns. Not only do they pose serious risks, but they often fail to provide the quick, seamless experience they promise. The tax professionals of NewPoint Law Group have decades of experience working with California taxpayers on a wide variety of tax planning issues. Whether you simply need help preparing your tax return, or are facing an audit or criminal investigation, our tax professionals can help. To schedule a free and confidential initial consultation with a California tax attorney, please call 800-358-0305 today.