For those who want even more protection, TurboTax offers Audit Defense, which provides full representation in the event of an audit, for an additional fee. TurboTax offers the following options for support when you receive an audit notice. Your profession and financial situation will play a key role in your odds of being audited. If you’re working at a hospital or within a practice that someone else owns and are earning a standard salary, spending that extra $59 might not be worth it.
Advantages and Disadvantages of TurboTax Audit Defense
As you’d expect, the higher your income, the more likely you will get attention from the IRS. According to the IRS, out of the nearly 141 million individual returns that were filed for 2011, only 1.1 percent were audited. If you filed your taxes using TurboTax, you can get free one-on-one audit guidance from a trained tax professional. Unfortunately, no. You can’t add Audit Defense after filing your return.
Is TurboTax Audit Defense Worth It?
It’s the company’s way of assuring you that if a number gets transposed or your taxes get audited, you’ve got a resource you can rely on. That’s why it’s important to file your taxes accurately, whether you do it yourself or find a software or company that will guide you. A few minor errors could trigger an audit, but most of us are worried about the worst-case scenario happening to us. While TurboTax can process standard business expenses, it lacks the depth needed for those with complex deductions, investments, and business income. For instance, TurboTax may not catch every possible deduction for those in unique industries or those with specific investment strategies.
The TurboTax Audit Support Guarantee also includes the option to connect with an experienced tax professional for free one-on-one audit guidance. TurboTax makes it easy to file your federal and state taxes online without having to visit a costly tax preparation agent. With TurboTax’s Audit Defense, you can also pay an additional fee to gain some protection should you get audited. Fewer than 1% of tax returns with $200,000 or less in income are audited. That percentage grows to 10% and higher for those earning above $1 million.
Is TurboTax MAX and Audit Defense Worth It?
- Unusual or unrealistic itemized deductions, either for individuals or small business owners, may raise a red flag for auditors.
- So, if you had Audit Defense for your 2019 return, you’d be covered for that year if you were audited in, say, 2022.
- If you’re ever assessed an IRS or state penalty or interest due to a TurboTax calculation error, we’ll pay you the penalty and interest.
- If you have PLUS, Max Benefits, or Premium Services listed, then you purchased Audit Defense.
TurboTax Audit Defense is part of the MAX services, which cost $60 on top of your tax preparation fees. It’s important to note that this service is a flat $60, whether you file a basic or a more complicated return. TurboTax has established itself as one of the best free tax software programs out there, especially if you don’t have a complicated return. This tax preparation company can help you file your annual return by choosing from one of the many editions available. The word “audit” fosters trepidation in many people, but in reality the deep-tissue audits people tend to envision are fairly rare. According to the IRS, of turbo tax audit protection the nearly 154 million individual returns filed for calendar year 2017, about 1 million were audited.
All features, services, support, prices, offers, terms and conditions are subject to change without notice. Audit Defense, on the other hand, is a perk from paying for TurboTax’s MAX package. You’ll have the aforementioned full representation by a licensed tax professional during all interactions with the IRS.
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- As long as you complete your tax filings accurately and on-time, the chances of an audit are low.
- We hope we’ve also shown you that tax preparation doesn’t have to be a hassle.
- At the end of the day, TurboTax Audit Defense provides basic audit support, but its limitations could leave complex filers underserved.
- Each version offers varying levels of customer support, such as phone consultations with TurboTax experts and, in some versions, live chat support.
Dimov’s tax attorneys, on the other hand, are well-versed in industry-specific deductions, ensuring clients receive the full range of deductions available to them. TurboTax’s Audit Defense is a step up from its general audit “support.” TurboTax’s Audit Support Guarantee is included with all versions except for TurboTax Business. Users get a free consultation and audit information support to help them understand what’s happening if they receive an audit letter about their return. You will also be shown how to prepare for an audit and will have your audit-related questions answered year-round.
TurboTax Benefits
As long as you complete your tax filings accurately and on-time, the chances of an audit are low. When it comes to tax attorneys, shopping around can be helpful to compare and contrast what services you’re getting and what the going rate is. If you ever find yourself in need of a tax attorney, trade audit panic for preparation with finding a qualified attorney who will represent you.
With TurboTax Live Full Service, a local expert matched to your unique situation will do your taxes for you start to finish. Or, get unlimited help and advice from tax experts while you do your taxes with TurboTax Live Assisted. And if you want to file your own taxes, TurboTax will guide you step by step so you can feel confident they’ll be done right. No matter which way you file, we guarantee 100% accuracy and your maximum refund.Get started now by logging into TurboTax and file with confidence. TurboTax features a user-friendly interface that operates like an interview, guiding users through a set of questions about their life and income to identify deductions and make suitable choices.
However, we hope this review has calmed your fears about both audits and paying for TurboTax’s Audit Defense service. In some cases, Audit Defense might not be necessary or worth the additional cost, especially if you’re honest and certain your tax return is accurate. Each version offers varying levels of customer support, such as phone consultations with TurboTax experts and, in some versions, live chat support. However, even with these features, TurboTax’s assistance stops short of the personalized, in-depth service provided by licensed tax attorneys or CPAs.
We’re no legal experts by any means but if you’re concerned about an audit, choosing a professional with whom you work well can be a better alternative than paying $60 for TurboTax’s Audit Defense. Licensed tax attorneys make a living from helping consumers like you and me so they have a bit more skin in the game when it comes to advising and defending clients. In addition, most tax preparation services develop their software to be as straightforward and succinct as possible. If you don’t have issues entering your information (as long as you enter it correctly), it’s not likely you’re at risk for an audit. If you’re someone who deals in 1031 exchanges or even has several types of IRAs, the Premier version may not be robust enough to handle your situation.
You cannot go to jail for making a mistake or filing your tax return incorrectly. If the IRS has found you „guilty“ during a tax audit, this means that you owe additional funds on top of what has already been paid as part of your previous tax return. At this point, you have the option to appeal the conclusion if you so choose. While many people choose to do their taxes themselves, wading through instructional forms and documents can be a hassle. Paying a software program or even a tax preparation specialist to take care of it all can be well worth the price. For most Americans, tax time either means paying the Internal Revenue Service (IRS) big money or getting a refund in the mail.
These services typically come at an extra cost if you were to purchase them through another source. If your return is simply entering a W-2 and calling it a day, you might qualify for the TurboTax Free Edition. Both federal and state taxes are free to file so you will only have to pay if you owe the IRS or your state. Our guide includes everything you need to know about TurboTax’s Audit Defense, including what it covers and how much it costs. We’ll also discuss your odds of getting audited, which are pretty slim for the average American.