Tax advice/questions (unofficial advice needed)

[frugalone]

Several months ago, I cashed in an EE bond that netted me around $14,000 in interest, thereby kicking up my adjusted gross income a bit. I have put aside some of it to pay taxes on it, but I figured it was a good idea to open an IRA and that possibly, the monies deposited into said IRA would "cancel out" the money owed on the interest.

However, I did a trial run of my taxes yesterday and (possibly because I am on the ACA exchange and get a tax credit) it turns out I owe approx. $2K to Uncle Sam.

So, I am wondering:

1. By opening an IRA for my spouse, since we file jointly, is there any way to determine whether the IRA contributions between the two of us would make this $2 a "wash"? and
2. I know absolutely nothing about things like Turbo Tax, Quicken, etc. I'm wondering if it might be worth my while to get a trial version of same to insert various scenarios into the software (i.e. different IRA contributions, for e.g.) so I don't have to do all the math myself. This is of course assuming these programs do the math for you. (And gosh, in the 21st century, I sure hope they do).

Can anyone give me a bit of unofficial advice on this matter? Otherwise, my taxes are pretty simple. We don't own property, no one is self-employed, there is no HSA involved, etc.

Thanks so much!

[ApatheticNoMore]

#2 yes absolutely, they automagically show what you owe or what you are getting back whenever you put information in (just make sure you put in that you had healthcare at least 10 months of the year if you did otherwise I've had them assume ACA penalties I did not owe). So you can fiddle with things like IRAs in real time to see what the advantages may be. I use Tax Cut, I really doubt it's the best one out there, just what I'm used to is all. But IRAs aren't getting into super complex calculations either, so it only needs to be decent. So price shop from any of the reputable programs etc..

#1 I really have no idea how joint taxes even work so can't help you there.

[frugalone]

thanks! Yes, we did have health care for all 12 months.

[sweetana3]

We use TurboTax and here is why. One year we had multiple states and even though my hubby is a finance major and I was working at the IRS and had for 20 years, we could not figure out the dual state issue. Turbotax saved us over $1,500 from the lowest amount the two of us were able to figure out. Two years ago we had some income from an estate in California and there return is nasty. Turbotax to the rescue. Then this year, it knew about a deduction on our state taxes that neither of us knew about and would have missed again saving us big time.

Husband uses it at the end of the year to see how we are doing and we do some planning with it.

[frugalone]

OK, wow, I am gobsmacked. I used the IRS's Software Lookup Tool to see about e-filing etc. I used one of the free e-file services to figure out my return Now I'm being told I'm owed money, not that I owe money.

I'm really bad at arithmetic and this is one of the reasons why I figured I should use some software.

I had better go over the numbers again, and try a couple of different programs. I do qualify for some of the free e-file ones, according to the IRS.

[Tybee]

Definitely get Turbo Tax or Taxcut, as you can run lots of different scenarios, and they do the figuring for you and can definitely save you lots of money.

[pinkytoe]

You don't actually purchase the tax programs till you file online. So you can plug in numbers and try different credit amounts (IRA etc) and get a good idea of whether or not something will help.