I few days ago I started filling a donation bag (the pink one in the picture below) with my old roller skates, a chocolate maker, a book, and a vest. After I wrote a post about it, a few people got inspired (see the comments in the aforementioned post) and donated something too. DW might have been reading along as well because much to my joy I found this collection when I got home today.

There was a big bag of romance novels, a box with some crafts stuff, xmas decorations, and a small food processor that we never use. There’s a pair of cowboy boots and a radio controlled car. There’s also what appears to be a small child with a duck tail haircut and big blue ears in one of the bags. No cause for alarm! That is my old Stitch doll (I relate to Stitch!) which I got at a yard sale. The big black 45 lbs clubbell stays though. Now this got me thinking. Should I start cataloguing this in order to get some tax deductions? Is it worth it?(I guess this would fetch $20-30 in a yard sale).

This week I overdosed on novocain at the dentist and almost passed out, reached my threshold for turning earlyretirementextreme.com into a business, and scored 4 goals in a pick up game (personal record). Other than that it was a fairly uneventful week.

I bookmarked the following links:

• Turbotax 2007 premier contest – Generation X Finance has a contest going. Hurry up! I’m still torn between H&R Block, etc, finding a CPA, and using software. This year I have two states, relocation deductions, some hairy option assignments, and worst of all defaulted prosper loans to deal with.
• Debt is slavery – This is the book I was planning to write, but someone beat me to it. Millionaire Mommy Next Door provides a great summary.
• Modern day bartering to save money – I like this idea. I really like it. I think often we are so used to getting what we need from the market that we do not consider bartering.
• Yield to life – I’ve had my share of incompetent SUV 5’3″ drivers who can barely see over their side door pull out right in front of me as well as car drivers who haven’t realized that a bicycle can easily go 25 mph. If you drive a car please check out this site!
• Jung typology and finance – I vs E – A statistically significant number of pf bloggers are masterminds (INTJs). Why is that? Starting with the I/E dimension, I will be interested to hear what Flexo has to say about the other three.
• We’ve forgotten how to fix things – Not only that, somethings are built so they can’t be fixed. Even worse, we regularly use things whose inner function we are absolutely clueless about. Technology has become the new magic.

This week I participated in the following carnivals.

• Festival of Frugality #112
• Second “Tips for Green Living” Carnival

This year I figured I wanted to save the 30+ hours I spent last year doing my taxes. I have heard a lot of good things about various tax preparation programs that can fill out taxes and thus obviate the need for an accountant. After all if individuals need to hire experts merely to comply with the laws of a country, it seems to me that something has gone horribly wrong. I’d like to think that this is not the case – hahaha oh I slay me – and perhaps I’m in denial about the good intentions of government, but I have elected not to get an accountant.

This leaves the choice between using a program and using my time.

This year my return is complicated by relocation expenses, a bunch of retirement plans, and paying taxes in two states. Therefore I figured I would try the program option first. I did not want to spend time researching various programs as this would be similar to just reading the IRS instructions (which are actually pretty good!). Therefore I just went with with my broker was advertising at a discount, namely TurboTax. The possibility of importing broker data directly into the tax software sounded especially appealing. I remember matching trades (I have about 50 trades a year) last year and it was a pain.

So onwards and upwards.

My initial impressions were that the online version of TurboTax was very friendly. One clicks boxes for “I moved for a new job”, “I pay tax in two states”, “I contributed to a retirement plan”, … sure we can handle that no problem. Thus encouraged I started entering our W-2 info. This can be downloaded but that didn’t work for me. So I entered everything by hand. This was not a big issue except it took somewhat longer than merely reading off the forms and filling the numbers into the 1040 by hand. (Not all of them are actually needed).

Then came the investments, and this is where things went haywire. I successfully downloaded my broker data, but it turned out that TurboTax only got the 1099 forms. Obviously those are useless for calculating gains or losses since they don’t include the cost basis. I started entering numbers in their spreadsheet format. This was significantly complicated by the fact that my option trades aren’t part of the 1099s and thus did not import either. After 30 minutes I was done with the first few companies and clicked continue only to get a friendly message my session had timed out after 20 minutes, ARGH! Now I’m a patient man when it comes to computers — I expect a little more from humans 😛 — so I started over making sure to click done and restart the process every 15 minutes. Now if a covered short call gets assigned the sales price of the call gets added to the proceeds. Also if an short option expires, the IRS expects you to write “Expired”. Apparently TurboTax can’t do short options. Thus after spending 4 hours doing the usual matching on a piece of scrap paper and trying to fit it into TurboTax’s menus, I gave up. I was getting very concerned that I would miss a trade or two due to the security timeouts which required a restart every time. Now this would have worked beautifully if I had only bought and sold a handful of stocks, but I build positions in pieces, and I cover them from time to time which introduces all sorts of mental pain when it comes to figuring out whether certain dividends are truly qualified or not. The program clearly wasn’t designed with my situation in mind.

So this year I’ll be doing my taxes by hand again. This means I’ll save the money on the tax preparation software but this is nothing compared to the sense of accomplishment from having wasted 30 productive hours by filling out complex tax forms.

I’d like to remark that If I was the president my economic stimulus package would not be what amounts to a forced loan from myself to myself (as if?!) but a reduction of the tax code.

Originally posted 2008-03-11 07:43:09.