Preparing your taxes can be stressful enough without adding the problem of the entire process going wrong. Even when you go on a site that promises to be foolproof or secure or professional, the result can sometimes be devastating.
An examination of dozens of reviews by Sitejabber.com users shows a wide range of potential pitfalls for consumers – from outright scams to software problems to misleading promises. Learn from others who have gone down a path they regretted.
Here are 5 ways your online tax returns can go wrong:
1. Where are my records?
One of the benefits of using the same tax preparer or preparation service from one year to the next is not having to feed all the same information in over and over again. You might assume that would be the case with all tax preparation services. But it isn’t. One user who found promise from one of the tax services to be empty: “Safe, Secure and available to you 24 hours a day 7 days a week, that’s our guarantee to you. … You can revise, read or print your return 24 hours a day, 7 days a week. Your tax returns will be stored safely and securely for 3 years.” But the user couldn’t find the prior year’s taxes. After asking, the response from the site’s email customer service was that they don’t keep the records. The user: “No one can give me an answer other than ‘Contact the IRS.” Another user ran into a similar problem simply after logging out before printing a copy of a return. “You can’t log back in to print out your taxes if you need to in the future. I logged back in to print after buying a new printer cartridge, but not all of my forms were available…most importantly the 1040 ez. This made my life miserable when I went to apply for my student loans.”
2. Free isn’t always free
It’s pretty common to see boasts of “free” services on tax sites. And there are some things that really are free. But sometimes free comes with a price. Hidden in contract language that consumers agree to without reading can be traps that lead you to get charged for what you thought would cost nothing. Here’s one user’s take: “BIG ripoff-DON’T USE IT!!! – First, it’s not FREE…nothing on it is free. They charged my debit card for $24.95, unauthorized!!! When I sent an email to inquire…they said it was for “audit protection”… I also entered everything for my federal and state returns…but they never filed my state taxes…they said it was because I didn’t file both at the same time…that is incorrect. One lesson from that experience: If you enter credit card or debit card information it allows you to be charged.
3. Unreliability
When you press the “send” button on your taxes you should have good reason to assume that they’ve been filed. While some tax sites enjoy fine reputations and use top-notch software, unfortunately, some others apparently don’t. Glitches and other problems have led some users to learn the hard way that the taxes they thought they filed weren’t. That also means the refund they were waiting for didn’t come. Here’s one user’s account of that unfortunate scenario from another problematic tax site: “I filed before the deadline. i even paid their fee to have my state tax forms filed electronically. My Federal was rejected because I had “already used my ss# on my state return”. Their web site indicated that my state forms were accepted by the tax board, I also received an email stating that my state forms were accepted. As I had filed electronically with direct deposit I expected my refund within a month. 2 months passed still no refund. I contacted the state tax board to follow up. They informed me that they never received any tax forms from me.”
4. Miscalculations
What if you put exactly the same information into two different sites and came up with two very different results? One user did just that after getting a surprising result on one site showing money was due instead of a refund. ” I will never use this site again. Shortly after starting to do my return it showed that I owed the state….a lot! this is weird because I have been getting money back… and now according to its figures, i owe ……i went to (another site) and it was totally different and i WAS due money back.”
5. Whose refund is it?
About the only highlight of doing your taxes is finding out that you’re getting a refund – and then actually getting it. What if the site got the refund instead and took a cut of it before giving you what was left? That really happens. “I was supposed to get $1257.00 back and i got $1162.15. They took out $94.85. I called the I.R.S. and the said the check was made out (them). They took out a fee. They didn’t say anything about charging anything.”
Now what?
Not every tax site is sketchy. Plenty provide a good experience for their customers – even some that have some practices that have caused problems. Seeing what other consumers have had to say about their own experiences can help you avoid the trouble spots – and make it easier for you to choose an online tax service you can feel comfortable with. You can find a collection of tax site reviews from Sitejabber users to help find the right one for you, and to avoid those with practices you don’t like.
About the author: Mitch Lipka is one of nation’s leading consumer journalists. He edits TheConsumerChronicle.com, is a columnist for The Boston Globe and is a regular contributor to Reuters. Mitch was the recipient of the 2010 New York Press Club award for best consumer writing on the web and previously worked at AOL’s WalletPop.com, The Philadelphia Inquirer, the South Florida Sun-Sentinel and Consumer Reports.
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