WSJ Reporter doing story about doing taxes by hand

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Mel Lindauer
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WSJ Reporter doing story about doing taxes by hand

Post by Mel Lindauer »

Hi Everyone:

Laura Saunders, who writes about taxes for the Wall St. Journal, would like to talk to Bogleheads who do their taxes "by hand"--i.e. without using a preparer or commercial software. She posted this request before the pandemic and is resuming the project now. Please write soon, or at least by Monday June 29. Email: Laura.saunders@wsj.com

If you fit the profile and would like to be interviewed for the story, contact Laura via email and provide her with your contact info.
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Re: WSJ Reporter doing story about doing taxes by hand

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Based on past threads on this Forum, plenty of folks should be candidates to speak to this reporter.
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Re: WSJ Reporter doing story about doing taxes by hand

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Doing by hand is a major education in how taxes affect your whole Financial Life.
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Re: WSJ Reporter doing story about doing taxes by hand

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Stinky wrote: Wed Jun 24, 2020 8:11 pm Based on past threads on this Forum, plenty of folks should be candidates to speak to this reporter.
That's good. Let's see if Laura gets enough responses for her story.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by sport »

Stinky wrote: Wed Jun 24, 2020 8:11 pm Based on past threads on this Forum, plenty of folks should be candidates to speak to this reporter.
I would be a good candidate. However, I see no reason to get involved with the WSJ.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by Mel Lindauer »

sport wrote: Wed Jun 24, 2020 10:29 pm
Stinky wrote: Wed Jun 24, 2020 8:11 pm Based on past threads on this Forum, plenty of folks should be candidates to speak to this reporter.
I would be a good candidate. However, I see no reason to get involved with the WSJ.
That's certainly your choice. Agreeing to be interviewed is entirely voluntary.
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Re: WSJ Reporter doing story about doing taxes by hand

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Mel Lindauer wrote: Thu Jun 25, 2020 12:11 am
sport wrote: Wed Jun 24, 2020 10:29 pm
Stinky wrote: Wed Jun 24, 2020 8:11 pm Based on past threads on this Forum, plenty of folks should be candidates to speak to this reporter.
I would be a good candidate. However, I see no reason to get involved with the WSJ.
That's certainly your choice. Agreeing to be interviewed is entirely voluntary.
I wonder if she’ll confine her interviews to Bogleheads.

I expect that there are a lot more folks than us BHs that do taxes manually.
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Re: WSJ Reporter doing story about doing taxes by hand

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Stinky wrote: Thu Jun 25, 2020 10:40 am
Mel Lindauer wrote: Thu Jun 25, 2020 12:11 am
sport wrote: Wed Jun 24, 2020 10:29 pm
Stinky wrote: Wed Jun 24, 2020 8:11 pm Based on past threads on this Forum, plenty of folks should be candidates to speak to this reporter.
I would be a good candidate. However, I see no reason to get involved with the WSJ.
That's certainly your choice. Agreeing to be interviewed is entirely voluntary.
I wonder if she’ll confine her interviews to Bogleheads.

I expect that there are a lot more folks than us BHs that do taxes manually.
Not sure, but Bogleheads are such a diverse group (age, location, education, financial and marital status) that we're probably an ideal cross-section of tax payers.
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Re: WSJ Reporter doing story about doing taxes by hand

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joe8d wrote: Wed Jun 24, 2020 8:36 pm Doing by hand is a major education in how taxes affect your whole Financial Life.
Doing by hand is impossible or at least a huge waste of time if you have anything even mildly complicated.
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My taxes are always done by hand... :D
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Re: WSJ Reporter doing story about doing taxes by hand

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Gotta hand it to you....
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Re: WSJ Reporter doing story about doing taxes by hand

Post by Quirkz »

Up until last year I'd always done them by hand, but this site convinced me to try one of the electronic tools and I liked it pretty well. Not sure if that counts for the purposes of the article or not.
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Re: WSJ Reporter doing story about doing taxes by hand

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Quirkz wrote: Thu Jun 25, 2020 2:06 pm Up until last year I'd always done them by hand, but this site convinced me to try one of the electronic tools and I liked it pretty well. Not sure if that counts for the purposes of the article or not.
Contact Laura with your story.snd see if she's interested.. Nothing ventured, nothing gained.
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Re: WSJ Reporter doing story about doing taxes by hand

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PluckyDucky wrote: Thu Jun 25, 2020 1:03 pm
joe8d wrote: Wed Jun 24, 2020 8:36 pm Doing by hand is a major education in how taxes affect your whole Financial Life.
Doing by hand is impossible or at least a huge waste of time if you have anything even mildly complicated.
what kinds of things are considered at least mildly complicated"
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Re: WSJ Reporter doing story about doing taxes by hand

Post by littlebird »

PluckyDucky wrote: Thu Jun 25, 2020 1:03 pm
joe8d wrote: Wed Jun 24, 2020 8:36 pm Doing by hand is a major education in how taxes affect your whole Financial Life.
Doing by hand is impossible or at least a huge waste of time if you have anything even mildly complicated.
Not for me.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by JonnyB »

kaneohe wrote: Thu Jun 25, 2020 2:16 pm
PluckyDucky wrote: Thu Jun 25, 2020 1:03 pm
joe8d wrote: Wed Jun 24, 2020 8:36 pm Doing by hand is a major education in how taxes affect your whole Financial Life.
Doing by hand is impossible or at least a huge waste of time if you have anything even mildly complicated.
what kinds of things are considered at least mildly complicated"
One example would be where there is a circular dependency between two form entries which requires an iterative solution. That will give your calculator a workout.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by Stinky »

JonnyB wrote: Thu Jun 25, 2020 3:57 pm
kaneohe wrote: Thu Jun 25, 2020 2:16 pm
PluckyDucky wrote: Thu Jun 25, 2020 1:03 pm
joe8d wrote: Wed Jun 24, 2020 8:36 pm Doing by hand is a major education in how taxes affect your whole Financial Life.
Doing by hand is impossible or at least a huge waste of time if you have anything even mildly complicated.
what kinds of things are considered at least mildly complicated"
One example would be where there is a circular dependency between two form entries which requires an iterative solution. That will give your calculator a workout.
I’ve never hit a circular dependency in the federal tax forms.

Can you give an example?
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Re: WSJ Reporter doing story about doing taxes by hand

Post by JonnyB »

Stinky wrote: Thu Jun 25, 2020 4:09 pm
JonnyB wrote: Thu Jun 25, 2020 3:57 pm
kaneohe wrote: Thu Jun 25, 2020 2:16 pm
PluckyDucky wrote: Thu Jun 25, 2020 1:03 pm
joe8d wrote: Wed Jun 24, 2020 8:36 pm Doing by hand is a major education in how taxes affect your whole Financial Life.
Doing by hand is impossible or at least a huge waste of time if you have anything even mildly complicated.
what kinds of things are considered at least mildly complicated"
One example would be where there is a circular dependency between two form entries which requires an iterative solution. That will give your calculator a workout.
I’ve never hit a circular dependency in the federal tax forms.

Can you give an example?
One example would be the circular dependency of lines 8a and 8b on Form 1040. For example, assume that you are self-employed and deduct your health insurance premiums on line 8a. This lowers your income on line 8b.

Next you go to Form 8962 to compute your Obamacare premium tax credit. You use the adjusted gross income on line 8b. This premium tax credit reduces the amount of deductible premiums you pay, which takes you back to line 8a.

Line 8a is reduced which increases your income on line 8b. The increase on line 8b reduces your premium tax credit which then increases your premium deduction on line 8a. And so on until you reach a difference less than a dollar.

Software like TurboTax does all of this instantly, saving you a lot of work with your calculator. You probably aren't even aware it happens.
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Re: WSJ Reporter doing story about doing taxes by hand

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JonnyB wrote: Thu Jun 25, 2020 5:35 pm
Stinky wrote: Thu Jun 25, 2020 4:09 pm I’ve never hit a circular dependency in the federal tax forms.

Can you give an example?
One example would be the circular dependency of lines 8a and 8b on Form 1040. For example, assume that you are self-employed and deduct your health insurance premiums on line 8a. This lowers your income on line 8b.

Next you go to Form 8962 to compute your Obamacare premium tax credit. You use the adjusted gross income on line 8b. This premium tax credit reduces the amount of deductible premiums you pay, which takes you back to line 8a.

Line 8a is reduced which increases your income on line 8b. The increase on line 8b reduces your premium tax credit which then increases your premium deduction on line 8a. And so on until you reach a difference less than a dollar.

Software like TurboTax does all of this instantly, saving you a lot of work with your calculator. You probably aren't even aware it happens.
Interesting. Thank you.

I was neither self employed nor an Obamacare user, so I was unaware of the circularity.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by Miriam2 »

I have always done my taxes by hand - pencil to paper with hand calculator since I was 16 years old (just a few decades ago) :mrgreen: I just follow the directions, line by line, and use IRS Publication 17.

I do the taxes for my son, and I have him sit next to me so he learns how to do them. Doing by hand gives us the best understanding of how taxes flow, how the forms and lines are organized, the categories of "income" and "deductions" and "credits" - there is a method to the IRS madness :shock:

Several years ago, I neglected to include my son's Saver's Credit on his tax form. The nice IRS sent him a letter: "You qualify for the Saver's Credit - why didn't you take it?" My son glared at me, then fired me, signed the IRS form they sent him and soon received a big check for $399 :mrgreen:

Perhaps a lesson - probably TurboTax would have caught the error.
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Re: WSJ Reporter doing story about doing taxes by hand

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Miriam2 wrote: Thu Jun 25, 2020 6:14 pm Perhaps a lesson - probably TurboTax would have caught the error.
That's a good example of "you don't know what you don't know."

If you have a pretty simple return and it doesn't change much from year to year, doing it by hand is pretty easy. But even then you may not always be aware of tax law changes that you might overlook.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by muddlehead »

Interesting example above given as to when doing one's taxes by hand became too difficult. Did mine, and then ours, by hand for 40 years or so until we too got to ACA / Obamacare here in California. Became unbearably tricky at that point.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by Mr. Rumples »

Always do my taxes by hand with my Dollar Store calculator. This last year was the first time I had taken the standard deduction, perhaps since 1990. Twice I made mistakes and had to do an amended return. I have been pretty lucky in past years in that if I could not figure something out, I was able to get an IRS person on the phone to help. The most difficult part really was doing part year tax forms (PY) when moving. The VA one is so ridiculous that I drove to Richmond where they have a walk in tax assistance office. Even the tax examiner couldn't figure one thing out but she guessed and I never heard more.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by freetz »

Had a 30 min call with Laura today - I follow her column for quite some time now so enjoyed speaking with her.
She was really nice but also said she's casting a wide net so speaking with many people with all kinds of backgrounds. Also said that the column will be heavily edited so she can't guarantee her editors would include my story in the printed column.
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Re: WSJ Reporter doing story about doing taxes by hand

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freetz wrote: Thu Jun 25, 2020 11:36 pm Had a 30 min call with Laura today - I follow her column for quite some time now so enjoyed speaking with her.
She was really nice but also said she's casting a wide net so speaking with many people with all kinds of backgrounds. Also said that the column will be heavily edited so she can't guarantee her editors would include my story in the printed column.
Yes, editors can butcher a writer's work, But then again, that's their job. Hopefully your story will survive the editor's digital scissors.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by ivk5 »

I did 15-20 yrs of taxes by hand. Great education and the resulting understanding of tax planning considerations has been very valuable. Still, I missed things. Notably, one year I had FICA overwithheld by $1k due to multiple employers, which I didn’t claim or notice until too late to amend. I’m sure there have been others.

Once my income was coming from a partnership generating complex K1s (eg passing through some foreign income and tax credits, among other esoterica), continuing to do returns by compass and clock was out of the question.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by Amanda999 »

I finally bought tax software once I had to calculate the AMT worksheet. The cost was worth it for that one schedule alone.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by JackoC »

Stinky wrote: Thu Jun 25, 2020 5:54 pm
JonnyB wrote: Thu Jun 25, 2020 5:35 pm
Stinky wrote: Thu Jun 25, 2020 4:09 pm I’ve never hit a circular dependency in the federal tax forms.

Can you give an example?
One example would be the circular dependency of lines 8a and 8b on Form 1040. For example, assume that you are self-employed and deduct your health insurance premiums on line 8a. This lowers your income on line 8b.

Next you go to Form 8962 to compute your Obamacare premium tax credit. You use the adjusted gross income on line 8b. This premium tax credit reduces the amount of deductible premiums you pay, which takes you back to line 8a.

Line 8a is reduced which increases your income on line 8b. The increase on line 8b reduces your premium tax credit which then increases your premium deduction on line 8a. And so on until you reach a difference less than a dollar.

Software like TurboTax does all of this instantly, saving you a lot of work with your calculator. You probably aren't even aware it happens.
Interesting. Thank you.
I was neither self employed nor an Obamacare user, so I was unaware of the circularity.
Everybody doesn't have the same idea in mind when you say your taxes are 'complicated' or not but I'd wager I'd find the tax returns of virtually everyone here who does them by hand to be quite simple. There's nothing wrong with that obviously. It's just that sitting at one's own keyboard naturally thinking in terms one's own return isn't very useful for determining how much trouble it would be for somebody else to do it by hand.

The 23 returns I do annually for family members and their trusts and LLC's range from simple to complicated. Doing them by hand might be possible for me but a ridiculous waste of time. I used to do iterative design calculation as engineer not quite back in the slide rule days (tail end of it in one high school AP course) but paper and calculator, mainframe or mini-computer was then only for certain well defined things scheduled in advance. So even though I've surely lost some brain power since, I might be able to do all those returns by hand. There's just no reason to waste all that time. The cost of the software is trivial to me.

Also the idea hand calcs teach you more about how the tax code actually works is flawed IMO. At a given level of interest in how it actually works you can do a lot more in a given amount of time 'what iffing' the results of Turbotax by varying inputs than doing the whole thing over and over by hand. The various circularities and cliffs are only practically found that way, for a non-genius at least.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by rkhusky »

I have a spreadsheet for my taxes. Does that count as doing it by hand? The spreadsheet allows me to do what-ifs and tax planning.
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Re: WSJ Reporter doing story about doing taxes by hand

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rkhusky wrote: Fri Jun 26, 2020 4:25 pm I have a spreadsheet for my taxes. Does that count as doing it by hand? The spreadsheet allows me to do what-ifs and tax planning.
Yes, that counts as “by hand”. That’s the way I do my taxes.

I talked with Laura for about 30 minutes today. Very pleasant conversation. She said that the article should print right around tax day (July 15) if it publishes at all.
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Re: WSJ Reporter doing story about doing taxes by hand

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rkhusky wrote: Fri Jun 26, 2020 4:25 pm I have a spreadsheet for my taxes. Does that count as doing it by hand? The spreadsheet allows me to do what-ifs and tax planning.
I used to do that before the growing complexity made it too difficult to justify, if possible (for me) at all. Besides the gradually increasing number of returns for family members/entities over the years. I think this will also be difficult to convey in an article, what actual level of complexity of taxes people are doing on paper or in a spreadsheet
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Re: WSJ Reporter doing story about doing taxes by hand

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rkhusky wrote: Fri Jun 26, 2020 4:25 pm I have a spreadsheet for my taxes. Does that count as doing it by hand? The spreadsheet allows me to do what-ifs and tax planning.
I have been using a homemade spreadsheet going back to 1996, when I did my 1995 taxes a few months after buying my first PC. My spreadsheet also allows me to do what-ifs and tax planning, two very valuable resources.

I have been doing my taxes by hand since the first tax year I filed returns, 1985. My taxes have had rises and falls in their complexity, from renting to owning my residence, to including investment income such as dividends and cap gains, to paying off my mortgage, to including for 8 years a second state for a non-resident return, to my most complex return in 2008 when I cashed out my employer stock and had several worksheets and the AMT to tackle, and to the ACA premium tax credit. Major tax law changes in 1986, 1997, 2003, and 2018 forced me to alter my spreadsheet (not 1986).

I don't have any desire to contact Ms. Saunders, though.
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Re: WSJ Reporter doing story about doing taxes by hand

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Must be a slow news day to write about something so boring.
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Re: WSJ Reporter doing story about doing taxes by hand

Post by abuss368 »

I know of one person who still does by hand. With all the free options available I was surprised.
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