[greenyoda]

My major reservation about using newly developed software to do my taxes is that it has no reputation - I have no idea whether to trust it or not. Will it expose me to the risk of being audited? Will it accurately send the IRS the same numbers that it's displaying on my screen? There will be no reviews available on Amazon or elsewhere when the software hits the market, and nobody I can ask about their experience with the software. I'd have to trust it on blind faith.

Also, there are strong forces working against a tiny company that wants to enter this complex market. A company with four people:

- Can't afford to hire as many testers as Intuit (or H&R Block, or the other major players) to test their software to make sure that it operates correctly.

- Can't hire as many CPAs and tax lawyers to confirm that they comply with the latest tax laws. If they want to "make income tax preparation and filing free for every taxpayer in America" (as their web site claims), that would involve staying on top of federal tax regulations, the tax regulations of fifty states, and also cities like NYC that have their own income tax.

- Can't hire as many security specialists to make sure that they're haven't overlooked a vulnerability on their web site.

So what's the value proposition? Why should people risk using this product next year instead of shelling out $25 or $50 dollars for the tax prep software they used for the last several years?

[ecolner]

Your odds of being audited are based on the information that you provide, and that alone. Your return will be rejected if the government tests it and it fails to have the correct calculations. This happens. The government gives companies 48 hours to correct and retransmit in those cases (by law). All sorts of games are played using this 48 hours window. And it would be improper for me to discuss this with you further beyond just stating the law is on the books and it is utilized. Obviously we'd prefer to submit your return and be correct 100% of the time.

Everything you said is true. There's a pretty big difference between 4 people versus 400 people working on software. All I can say is that probably 10% (that's optimistic) of the people working on any given project make a difference in a large company. At least that's been my experience. And that's why you get startups bringing products to market with great success over and over again.

We encourage you to keep spending the money if it gives you the warm feelz! It's your money and it's our job to convince you to make the switch. You'll be able to use any product out there and compare the results for yourself before submitting your returns next season, so we've got that going for us.

[pbnjay]

I'm not sure I've ever seen tax prep software where you couldn't print out the return and mail it in yourself - wouldn't that address your "blind faith" and accuracy arguments?

Presumably they're building something a little more innovative in which case the product speaks for itself and the lack of reputation is outweighed by overcoming a severe pain point.