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Should TURBOTAX be responsible for my audit with the IRS?

Kalama, WA |

I was recently auditted for the year 2011 because I was over paid and I had to pay the IRS $1290.30 I feel TURBOTAX should be responsible because they did not catch the error and they have a 100% accuracy guarantee. When filing I filled out the amount from my W-4 under "Wages, tips, other comp" incorrectly. I entered 20,564 instead of 28,564. The reason I feel TURBOTAX should of caught this error is because I entered 28,564 on "social security wages" and "medicare wages and tips" and these three boxes are typically always the same number. If anything the "wages, tips, other comp" could be more than the other two but definitely not LESS. Please let me know if I am mistaken in that logic because I cannot help but feel cheated. I also bought audit defense and they did nothing. Thanks

Attorney Answers 4


  1. Best answer

    Unfortunately, Social Security wages doesn't necessarily have to match and the computer program isn't going to catch that discrepancy. Also, you may pay a small penalty, but most of the additional taxes owed is due to the under reporting of income. Regardless if TurboTax caught the mistake, tax would still be owed to the government. TurboTax guarantees accuracy based on the data input into the return, but they won't pay taxes that were under reported.

    Legal disclaimer: The answer provided are for informational purposes only. Responses are not intended to constitute legal advice. Answers provided should not be relied upon in lieu of consultation with an attorney. At no point do responses provided establish an attorney client relationship. Answers may differs if additional facts were provided.


  2. Garbage In Garbage Out. Please hire a professional next year to prepare your tax return!

    If you do not like this answer or disagree, please look at one of the other answers provided. It is not necessary for you to try prove this answer is "wrong" or something with which you do not agree. This is a free service for you based on limited facts. Nevertheless, many times you need to consult an attorney with the details to get actual advice specific to your concerns. Do not put too many details in your questions or comments because this makes the information public and could hurt you. Government Regulations contained in IRS Circular 230 regulate written communications about Federal tax matters, including e-mail, between us and our clients. This is another attempt by the government to limit your rights and to extend the control of government over individuals and businesses. Nevertheless, such communications are either opinions or other written communications. This is not an opinion. It is other written communication and was not written to be relied upon, by itself, to avoid any tax penalties. In order to receive assurances of protection from tax penalties from a written communication, you should get an opinion letter. If you would like to discuss an opinion letter relating to any matter, please contact me and I will explain what is involved and what it will cost.


  3. I hate to say it but I think you need to move on and hire a qualified tax preparer. They will likely be able to save you more money than they cost.


  4. "If anything the "wages, tips, other comp" could be more than the other two but definitely not LESS." Employees who get a lot of tips such as those working in casinos or hair salon generally have higher numbers in the Social Security and Medicare boxes than in the wage box.

    By your logic, I should buy TurboTax and put in $1 in the wage box. Then, Intuit, the maker of TurboTax would have to pay my income taxes for me.

    If you read the guarantee carefully, the guarantee is for errors made by the program not by the user. Here, by your own admission, you entered a much lower income. If you had entered "28,564" but the program used "20,564" to calculate the taxes, that would be covered by the guarantee.

    The facts as stated in your post point toward an error made by you and for which you are liable to pay.

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