Turbotax live tax "experts" gave me completely contradicting advice - waste of money

I just wasted $89 on the Turbotax live help feature and I'm beyond frustrated. My wife and I are filing jointly - nothing fancy, no business income - but I had a few situations this year that I thought their "experts" could help with. Big mistake. I spoke with THREE different so-called tax experts who couldn't give straight answers to any of my questions. They just rambled in circles and when I finally pinned them down for actual answers, each one contradicted the others! I honestly would've gotten better advice from a random internet search. Here's what I was dealing with: 1. Our homebuilder had to delay our closing by 3 months, forcing us to extend our apartment lease. The builder sent us a $4,000 check to cover those extra months of rent. I simply wanted to know if this payment was taxable income. After endless rambling, I finally got them to answer - two said "yes report it" and one said "no don't report it." Super helpful, right? I ended up reporting it to be safe. 2. I over-contributed to my 401k this year (went over the limit by about $800) because I switched employers and my second company's system didn't catch it. My 401k provider sent me a refund check for the excess. I just needed to know how to handle this in Turbotax. None of them knew! I eventually found the answer buried in some Turbotax forum post. 3. I received a 1099-R for the first time because I rolled over my old 401k to my new employer's plan. Simple question: is this rollover taxable? They were completely clueless - one actually started reading the definition of a 1099-R from Google while I waited! I've used Turbotax for 8 years and the software itself is fine, but their "expert" help option is a complete ripoff. Save your money and just use the regular version or even try ChatGPT for basic tax questions - you'll get better answers than from these so-called professionals.

0 coins

18 comments

Connor O'Neill

•8M

Having worked as a tax preparer for over 12 years, I can clear up these questions for you (and anyone else who might have similar situations): 1. The $4,000 reimbursement for rent is generally considered taxable income. It's essentially compensation for a loss, not unlike an insurance payment, so reporting it was the right call. It would typically be reported as "Other Income" on your return. 2. For 401k overcontributions, you need to report both the excess contribution and the earnings on that excess on your tax return. The check you received should be reported as income in the year you received it. In TurboTax, you'd enter this in the Income section under "Retirement Plan and Social Security Income" then look for options about excess contributions returned. 3. For a direct 401k rollover to another retirement account, you should receive a 1099-R with a code G in Box 7, indicating a direct rollover. This is NOT taxable as long as you moved it directly to another qualified retirement account. You still have to report the 1099-R on your return, but properly coded rollovers don't increase your taxable income. Sorry you had such a frustrating experience with their live help. Unfortunately, many of these services hire seasonal workers with basic training rather than experienced tax professionals.

0 coins

Connor O'Neill

•8M

Even if Box 2a shows the full amount, the code G in Box 7 overrides this and indicates to the IRS that it's a nontaxable rollover. When entering this in TurboTax, make sure you select that this was a rollover to a qualified retirement plan when prompted. TurboTax should recognize the code G and handle it correctly. If you want to double-check, look at the "Tax Data" view in TurboTax after entering the 1099-R. The distribution should show up on Form 1040, but there should be a $0 amount included in your taxable income. If it's showing as taxable, go back and make sure you properly indicated it was a direct rollover.

0 coins

Yara Khalil

•8M

After struggling with conflicting advice from so-called "tax experts" myself, I started using taxr.ai (https://taxr.ai) and it's been a game-changer for handling these exact situations. Last year I had a similar issue with a home purchase reimbursement and couldn't get a straight answer anywhere. The site analyzed my tax documents and provided clear guidance that matched what an actual CPA told me later (but for much less money). It handles complicated situations like 401k overcontributions and explains exactly how to report them in whatever tax software you use. The interface asks targeted questions rather than making you wade through generic advice.

0 coins

Yara Khalil

•8M

It has specific modules for handling retirement accounts including 401k rollovers, Roth conversions, and correctly interpreting 1099-R codes. It doesn't file your taxes for you, but gives you step-by-step instructions for exactly what to enter in whichever tax software you're using. I used it with TurboTax and it was so much clearer than their built-in help. As for reliability, it cites the specific IRS publications and tax code sections its advice is based on, which I really appreciate. They do offer an audit protection service, but I haven't needed to use it. What convinced me was when it correctly identified a deduction my previous accountant had missed for two years.

0 coins

Paolo Esposito

•8M

I was super skeptical about AI tax tools like the one mentioned above, but after getting frustrated with conflicting advice from TurboTax Live, I decided to try https://taxr.ai last month. I'm genuinely impressed with how it handled my 401k rollover confusion. When I uploaded my 1099-R, it immediately recognized the distribution code and explained exactly why it wasn't taxable and how to enter it correctly in TurboTax to make sure it didn't count as income. Saved me from potentially paying taxes on $68,000 that I shouldn't have! It also explained how to verify the entries were correct before filing. Way more helpful than the "expert" who just read definitions to me.

0 coins

Amina Toure

•8M

If you're still having issues getting through to someone who actually knows what they're talking about, try using Claimyr (https://claimyr.com). I was in a similar situation with confusing 1099-R forms from multiple rollovers and desperately needed to talk to someone at the IRS who could give me a definitive answer. I tried calling the IRS directly for weeks and kept getting disconnected or waiting for hours. Claimyr got me through to an actual IRS agent in about 20 minutes. You can see how it works in this demo: https://youtu.be/_kiP6q8DX5c. The agent I spoke with was way more knowledgeable than any of the TurboTax "experts" and confirmed exactly how to handle my rollover situation.

0 coins

Amina Toure

•8M

It uses an automated system that navigates the IRS phone tree and waits on hold for you. When an agent picks up, you get a call connecting you directly to them. It saved me from having to sit by my phone for hours. There is a fee, but considering I was about to pay an accountant $300+ to answer a simple question, it was worth it to me. What made it valuable was getting a definitive answer straight from the IRS instead of conflicting opinions from preparers who might be guessing.

0 coins

FireflyDreams

•8M

I was the biggest skeptic about that Claimyr service mentioned above. After two failed attempts to reach the IRS about a confusing notice I received, I reluctantly gave it a try last week. I honestly can't believe how well it worked. I had tried calling the IRS myself multiple times and kept getting the "call volume too high" message and disconnects. With Claimyr, I got a call back in about 35 minutes connecting me to an actual IRS representative. The agent cleared up my confusion about a 1099-R rollover that TurboTax had flagged incorrectly, and confirmed I had done everything right. Saved me hours of frustration and potentially preventing an incorrect filing.

0 coins

Natasha Kuznetsova

•8M

I've used TurboTax for years but this is exactly why I stopped paying for their "expert" help. Last year I asked three different questions and got contradicting answers to all of them. Seems like they just hire seasonal workers with minimal training and call them experts. For the 401k overcontribution question, here's what worked for me: Enter the returned amount as "Other Income" and in the description write "Returned excess 401k contribution." That way it's properly taxed (since you got the tax benefit when contributing) but doesn't get double-taxed later.

0 coins

Natasha Kuznetsova

•8M

For excess Roth IRA contributions that are returned, you generally don't report the principal amount as income (since you already paid tax on it), but you do need to report any earnings on that excess contribution as income in the year you receive the distribution. When you get the distribution, your IRA provider should send you a 1099-R that breaks down how much was principal and how much was earnings. In TurboTax, you'll enter the 1099-R and indicate it was a returned excess contribution, and it should handle the calculations correctly.

0 coins