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Tuesday, February 19, 2008

TurboTax: The Encore Presentation
by cl. panic, caller of Shenanigans!

Last week I called Shenanigans on TurboTax Deluxe 2007. In response, Bob Meighan, the VP of TurboTax*, commented in response and in defense of his company's product. His comments on TWoNN, like his comments elsewhere, were more directed at "correcting" me rather than assessing problems and investigating possible solutions. Some credit is deserved for a V.P. who trolls cyberspace to get a feel for customers' thoughts. But correcting customers instead of correcting their problems is the wrong approach.

Based on Mr. Meighan's comments, I engaged in a more thorough review of TurboTax Deluxe 2007's shenanigans. Not expecting such an esteemed visitor at TWoNN, I didn't originally see the need to pile up mountains of evidence in support of my rant. My apologies to our regular viewers now that this becomes necessary (though you can now skip the details thanks to NN's mad HTML skillz).

In short -- not only did TurboTax Deluxe 2007 not meet my needs (mainly with respect to ESPP stock sales):

  • TurboTax Deluxe 2007 over-promised and under-delivered;
  • TurboTax support did not provide accurate solutions;
  • although Intuit offers a "choice" of products, it failed to inform when a more appropriate product was available;
  • TurboTax withholds some features from Mac users that are available to PC users of the same software.

While Mr. Meighan "corrected" a number of my "misperceptions" and assertions about TurboTax, he did not address several of the underlying issues. I should pause briefly to note that even if a customer incorrectly perceives something, perhaps there is something to be said about the fact that the perception occurred in the first place.

When I called shenanigans and noted that Intuit had been removing features and raising prices, I didn't mean to limit my assessment to a single year. The shift to extracting more for less has been an ongoing process. Like dropping rebates for e-filing, raising e-file rates, and shifting features to more expensive products.

Although I commend Intuit for offering free tax prep and filing to lower-income individuals (and appreciated it as a student), I noted that over the past five years things have changed. Since I happen to have used TurboTax for the past 5 years, I decided to do some comparisons. (The photo is actually from my Mac's Application folder.)

C.P.: TurboTax Deluxe 2007 misleads the user regarding its ESPP capabilities.
At least in TurboTax Deluxe 2007 on the Mac**, TurboTax Deluxe affirmatively states that it will handle ESPP for you. Even though it really doesn't.

TurboTax 2007's big improvement is the "life changes" section that is supposed to help narrow the issues. Well, one of those questions is about ESPP.
  • TurboTax Deluxe 2007 specifically asks if the user participated in an ESPP in one of the very first "life changes" questions. Deluxe even responded "Your Employee Stock Plan - TurboTax will walk you though your purchase and/or sale for tax purposes to make sure you get all the savings you deserve."
  • In spite of its promises, TurboTax did not walk me through my ESPP sales; instead, it offered very basic assistance, treating the transaction as a standard stock sale.
  • TurboTax did not recommend an upgrade to Premier, even though Mr. Meighan notes that it would be a more appropriate product (see below).
  • TurboTax did not list ESPP in the income list at all this year; the ESPP entry completely fell off the map (see below).
TurboTax Deluxe 2007 specifically informs the user that it can and will handle ESPP share sales even though it does not (notice the Deluxe logo at the top left). This is either a misrepresentation or a very serious bug. The user is left thinking everything will be taken care of ... even though it won't be.

Don't believe me? Check out a screencast of the entire process. (You may need to hit full screen and then drag to enlarge the video to see it clearly; thanks to OmniDazzle for the highlighting feature).

Bob said: "Deluxe has not changed from last year in this [ESPP] area."
Bob is right; aside from the defects noted here, Intuit did not substantially deviate from its treatment of ESPP in Deluxe. There has been a slow decline in services offered by Deluxe in this regard (links to screencasts):
  • TurboTax Deluxe 2003 fully supported ESPP sales, including detailed interview topics.
  • TurboTax Deluxe 2004 dropped interview support for ESPP sales, recommended using Premier instead, but still listed ESPP for manual entry and allowed the user to designate whether allocations were included on a W2.
  • TurboTax Deluxe 2005 did not recommend using Premier, though it still listed ESPP for manual entry, and had the check box for wage allocation on a W2.
  • TurboTax Deluxe 2006 recommended Premier and then just tells you how to enter manually (as an investment) without even limited support.
  • TurboTax Deluxe 2007 asks about ESPP early in the life changes section of its interview. It says it will handle ESPPs, never warns that Premier is a better option, and then completely omits ESPP from the income choices later in the interview (it can be handled manually as a stock transaction).
I hadn't noticed these before because my previous participation in ESPP was limited to buying shares, which does not require any special treatment on the tax return (nor could I tell that TurboTax says to consider Premier once you start selling all of your hard-earned stock goodness).

So it appears that true interview support for ESPP in Deluxe was killed in 2004. So Deluxe 2006 was almost as bad as Deluxe 2007. Except that 2007 over-promises (above), and ...

Bob said: "However, if you want additional guidance and help in this complex area, then we recommend TurboTax Premier."
But ...

TurboTax Deluxe 2007 does not warn when Premier is more appropriate.
One of my complaints was that users were not warned that Premier was a better choice for certain areas (i.e.: ESPP). Mr. Mehigan did not address that issue; I believe that it remains a problem (apparently limited to Mac users) -- especially since the interview process promises that it will handle everything.

Prior versions had mixed success in warning users that Premier was a better choice for ESPP sales; Deluxe 2007 falls flat.

TurboTax Deluxe 2007 does not allow Mac users to immediately upgrade to Premier, and TurboTax support does not clearly indicate this fact.
So far, a user is left thinking everything is handled, and hasn't even been warned that another (more expensive product) is a better solution (since it might actually work). But even if a user knew he needed to upgrade, a Mac user cannot immediately do so (as a PC user can).

And Intuit's support is currently inaccurate. Just ask TINA (Intuit's Automated support agent) for help, and she'll give you the wrong answer (note that I specifically asked "How to upgrade to TurboTax Premier for Mac").
There's video of an attempt to follow TINA's directions to upgrade.

If you go digging in the support site, hidden at the bottom of a support document is a note that Mac users cannot upgrade within the software, but must contact Intuit for help. But a user reading about "Deluxe" may be unaware of the disparate treatment of Mac users, and may not scroll to the bottom -- especially since Mac users buy the exact same TurboTax Deluxe box as PC users.

Bob, please let TINA know she's wrong. And make that disclaimer in the support doc a little more apparent. Better yet, add full functionality to the Mac version!

Bob said: "
If you had continued on to Final Review, our diagnostics would have picked up the incomplete information."
Remember, this complaint was about TurboTax's failure to note that it didn't get basis information when it sucked information down from E*Trade. Quite frankly, addressing this issue during the Final Review is hardly a solution.

Based on TurboTax's behavior, I was presented with a screen indicating I owed three times the amount actually due. Suggesting that I should continue clicking on, and proceed to submit the return before an error is flagged is ridiculous.

I hardly think my behavior was abnormal when, suddenly presented with $20,000 in extra taxes due, I panicked and tried to figure out what the hell was wrong. The last thing I considered doing was saying, "aw shucks!" going on to the Final Review. Instead, I set about re-entering the information manually.

Thankfully, it appears that the issue has been resolved, because when I tried to duplicate the error tonight, I received the necessary warning about the missing cost basis.

Bob said: "Most retailers charge $30 extra for Premier (over Deluxe). However, by law we cannot dictate the price retailers charge. The fact that you found Premier at a discount is good in that there is a lot of competition in the market."
This was responding to my complaint that, after two tries to contact customer service in order to manually upgrade from Deluxe to Premier, I declined the agent's offer of $30 to upgrade when it was cheaper to do so in a retail store.

Bob's answer may be true from a inside/outside sales perspective, but it ignores the customer experience entirely. It seems that a more customer-friendly solution would be to match the price -- or give the upgrade for free due to the frustration endured by: trying to overcome TINA's stupidity, locating the correct answer hidden on Intuit's website, a failed initial attempt (an e-mail agent that doesn't even specify the price of the upgrade), and then overcoming the overseas contract agent's language barriers to actually communicate the problem and determine a solution.

Bob said: "Oh, by the way, I'm always looking out for the most outrageous and absurd blogs about TurboTax. No, just kidding. I actually use Google to help me troll for TurboTax postings so I can listen and respond."

I'm hope that Bob really was kidding and doesn't think that this is "outrageous" or "absurd." I believe that there are some serious issues regarding Intuit's implementation of TurboTax Deluxe 2007. Perhaps these are limited to the Mac versions of the software -- even so, they should be fixed.

Hopefully this post will help. Bob: send me an e-mail and I'll let you know where to send me my fees for the Q.C. work. "No, just kidding."

* I assume that the individual claiming to be Bob Mehigan of TurboTax is, in fact, Mr. Mehigan for purposes of this post.
** All comments are based on TurboTax Deluxe 2007 (TurboTax Engine v. 07-91), installed on a Mac.


Mr. Nonny Nu said...

cl. panic:

i hate to embarrass you, but you left a bootlace up bob's, uh, sensitive area, sometime during your repeatedly asskicking him. not sure if you want it back.

now *this* is how it's done, people!

~ ~ ~

Freelance Midget said...

best solution: use

it's free. and you can e-file state and federal.

*no, i was not paid to say this.

Nonny Nu said...

(though you can now skip the details thanks to NN's mad HTML skillz)
Please feel free to quoted me directly next time I use those mad HTML skillz ("I am a golden god!!!").

But, wow! I wasn't aware that TurboTax was shivving us where it hurts, Cl. Panic. For those of you who don't know Cl. Panic personally, I will tell you that he is not an idiot and would never write "outrageous and absurd" shamelistings if they weren't true. He is quite intelligent and is embarking on a speaking circuit tomorrow. Yes, people, that is how valuable his experience is! He gets paid (though maybe not in US dollars) for just talking.

So, when he says that there is shenanigans going on, I trust him. I used TaxACT myself. This is my third year now. I love them.

RE: Freelance Midget
OMG! Our little Midge is filing taxes--how cute!!

Cl. Panic said...

Well I had been happy with TurboTax and had chosen it about 5 years ago when TaxCut was still pretty buggy on its Mac implementation.

I'm left wondering if I should reconsider that decision going forward.

Though I'm now tempted to go back and compare e-filing fees and see HOW MUCH they've changed over time since those are a lot more hidden from the user when purchasing decisions are made.

Mr. Nonny Nu said...

"OMG! Our little Midge is filing taxes--how cute!!"

okay, cute is shirley temple singing o/` goodship lolipop o/` or a box full of kittens.

my mother had my oldest brother (whose father died in a drilling accident, his lungs filled with fire), my second oldest brother (whose father fled upon hearing of her pregnancy), and my older sister (whose father decided to celebrate by putting his mouth on a car's tailpipe two weeks after her birth, my mother finding him frozen with the car still running) by midge's age.

if you all don't stop calling this twenty-two year old cute, i'm personally going to put her out on the street, provided i can find enough johns interested in older women her age.

~ ~ ~

Nonny Nu said...

I'll have you all know that Mr. Nonny Nu's dad, Grandpa (Remember him? He went with me to see Sushi go through the pizza oven...), is alive and well, and one of my most favorite people in the world. Much more likeable than Grandpa's son...

MonkeyPig said...

My accountant does all my tax.
TurboTax..SherboTax...What's next..TurboDoc?

Bobby Peru said...

"My accountant does all my tax."

well, lah-dee-dah! aren't we miss fancy pants. are you currently surrounded by persian cats, or is it exotic leopards this time? came here to feed us cake, she did...

"What's next..TurboDick?"

mp! i'm surprised! (actually, that's not quite true.)

~ ~ ~

Nonny Nu said...

She's a doctor, not a detective! Sheesh!

Nonny Nu said...

My accountant does all my tax.
This coming from the sister that complains every time I tell her that I hired someone to do something for me. What happened to the DIY attitude, MP? Maybe *somebody* is so rich that they need an accountant now...

P.S. I'm not paying you back the money I owe you.

Anonymous said...

From Long Time Turbo Tax User:

You are so right on the degradation of Turbo Tax Deluxe over time and the misleading lead in on ESPP and stock options--now considering whether to bite the bullet and upgrade or figure out how to do it myself in Deluxe.

Cl. Panic said...


Not sure if you're following this thread. But the easiness of doing ESPP sales in TurboTax depends on how complicated your sales were.

If you had a qualifying sale and didn't sell in many lots, then it's pretty easy to do yourself.

On the other hand, if you really aren't comfortable or don't understand how to calculate basis, etc., the upgrade (admittedly) is probably worth the extra dough.

Unless you decide it's worth even a few more dollars to have a professional do your taxes for you and get a refund on your TurboTax purchase.

helioskiagrapher said...

Hiya cl. panic,

It's a year later, the 2008 tax year is upon us, and I find myself in the same dilemma you did last year -- trying to figure out whether Deluxe will handle ESPP sales on my Mac. (These always have an ordinary income component; so they cannot be handled as ordinary stock transactions.)

TurboTax support is hopelessly unhelpful and uninformed. Do you know if anything has changed (improved) for the Mac version of TurboTax 2008?

Thank you!

Cl. Panic said...


Thanks so much for the comment ... you might just prod me to do an update for 2009, but I haven't gotten things in gear for the new year yet.

My wild speculation is that things have not changed between the versions given the not-too-detailed comparison chart here.

That being said, you CAN do ESPP share sales in Deluxe if you have the mental fortitude to do so manually (as in: you do the math yourself and separately add a regular income transaction, and do a different capital gains transaction.) The guided walk-thru in Premier does make it a lot easier and is likely worth the $20-30 difference in lack of hassle if you bought or sold in several lots.

Intuit makes a lot of changes and bug fixes well into the tax season, so I wouldn't rush into buying a product and getting my taxes done tomorrow. And you'll probably also see more and more promotions as time goes on (the get-it-done-early types seem to end up paying more). Costco has boxed versions of Deluxe and Premier on sale for $39.99 and $62.99, respectively.

This year Intuit planned to restrict each copy of TT to a single return unless you paid extra. It was a huge PR fumble and they ended up changing that policy after their Amazon rating tanked.

After last year, I was totally unsatisfied with Intuit and TurboTax (I ended up buying boxed versions of both Deluxe and Premier to do a thorough review). Intuit stood by on their satisfaction guarantee; I made a claim for reimbursement, followed their return directions, and had a refund for the product's purchase price shortly thereafter.

Maybe it's time to do a shown-down between TT and TaxCut...

Nonny Nu said...