Best Online Tax Preparation Software – H&R Block, TurboTax, TaxACT, FreeTaxUSA
It’s tax season! Some people love it, some people hate it, and some people loathe it. That feeling of deep unadulterated loathing is restricted to tax accountants only. No one else gets to hate it more.
Despite your feelings on paying (and filing) taxes, if you made money this past year, you have to file. While you can certainly pay somebody to do your taxes, MOST people can easily file on their own and save money by utilizing online software instead of hiring a professional.
So, to take the guesswork out of which online tax software is right for you, we’ve taken a tremendous amount of time to examine the best online tax preparation companies – all which happen to be members of the IRS’ Free File Alliance – to determine which has the best tax preparation software for your particular tax situation.
Best Online Tax Software Breakdown
- FreeTaxUSA is available for taxpayers with an Adjusted Gross Income of $57,000 or less, under the age of 65, and living in the United States.
- Filers can electronically file federal returns for free and state returns for $9.95.
- A deluxe edition of FreeTax USA is available for only $5.95 which makes this one of the best values for online tax software! The deluxe edition includes Audit Assist, priority customer support, and unlimited amended returns.
- With Audit Assist, if you are chosen for audit by the IRS, FTU’s tax professionals will assist you in gathering the correct records, writing a response to the IRS, and preparing for the audit.
- Priority customer support means that you are moved to the front of the line for answers to your tax questions.
- If you accidentally omitted data or made an error, no worries! The deluxe edition includes unlimited amended returns for free.
- FreeTaxUSA is the cheapest of the four options in terms of electronically filing state returns.
- Customer support is available for free 24/7. Even better, all the representatives live and work in the United States!
- FTU is easy to navigate with interview style questions and the capability of skipping over entire sections that don’t apply to your personal tax situation.
- FreeTaxUSA does not support part-year or nonresident state returns.
- It also does not support the following forms (Note: most of these forms do not apply to taxpayers within the AGI limits): Form 2555 (Foreign Wage Income), Schedule H (Household Employment Tax), Form 4835 (Farm Rental), Form 6252 (Installment Sales), Form 8615 (Tax for Children with Income over $1,900), Form 8801 (Prior Year Minimum Tax Credit), Form 8885 (Health Coverage Tax Credit), Form 8853 (Archer MSAs), and Form 6198 (At-Risk Limitations).
- While the deluxe version is the cheapest of the four programs, it does not offer as many features as the other online tax software options below.
Bottom line: FreeTaxUSA is the best online tax preparation software for individuals with simplistic tax returns who want to use a no-muss, no-fuss tax software. It is the best online tax software for the most basic of returns.
Visit FreeTaxUSA by clicking HERE and get your taxes filed today!
- TaxACT is available for taxpayers living in the United States OR if you’re a citizen or permanent resident with a foreign address.
- Filers can electronically file federal returns for free and state returns for $14.95 each. TaxACT supports part-year and nonresident state returns.
- A deluxe edition of TaxACT is available for $9.95 for federal only or $21.95 for federal and state. This edition includes some awesome features including Donation Assistant, Life Events, Joint vs. Separate report, and Audit Assistant.
- Donation Assistant tracks your charitable contributions and provides audit-backed values. Great for taxpayers who made a large amount of non-cash donations and don’t want to spend hours researching values.
- Life Events determines the tax implications of your life changes – including marriage/divorce, adoption, and purchasing a home – in order to maximize deductions.
- Joint vs. Separate analyzes the filing status of married taxpayers to determine if Married Filing Joint or Married Filing Separate would yield a larger benefit.
- This online tax software offers step-by-step guidance and is a great feature for individuals without any tax experience. It takes you through every item in case your tax knowledge is slim to none.
- TaxACT has programs called Quick Convert and Stock Assistant. The former allows you to bridge in information from your prior year return, while the latter assists you in quickly entering stock data.
- College student? TaxACT has FAFSA Assistance! Prepare and print a worksheet with all the necessary tax information to fill out your FAFSA.
- TaxACT’s deluxe program has the widest selection of features – covering everything from itemized deductions to determining how different scenarios will affect your future tax returns. It also offers TaxTutor Guidance – a program that gives taxpayers expert tax preparation tips and strategies.
- TaxACT supports all the forms that FreeTaxUSA doesn’t! Nonresident or part-year state returns? No problem! Foreign wage income or household employment tax? Sounds good!
- While TaxACT has an answer center online available for free, it charges $7.95 for help via phone. This is one time fee and will allow the taxpayer to receive phone assistance for the entire tax year.
- TaxACT attempts to upsell early and often. That’s great for people who need the deluxe version, but can get irritating if you just want to input a small amount of tax data and be done.
Bottom line: TaxACT is the best online tax software for people who need step-by-step guidance. It has the best deluxe software for taxpayers with more involved tax implications – including non-cash charitable contributions, stock sales, and the purchasing or selling of a residence.
Visit TaxACT by clicking HERE and get your taxes filed today!
- H&R Block is available for taxpayers with an Adjusted Gross Income of $57,000 or less, under the age of 52, and living in the United States.
- Filers can electronically file federal returns for free and state returns for $14.95 (or free, if your state is eligible for free file).
- Options are available for taxpayers who do not meet the age or income requirements for Free File. The Basic package is for simple tax solutions and is $19.95 for federal returns and $34.95 for state. The Deluxe package is for investors and homeowners and costs $29.95 for federal and $34.95 for state.
- The first screen you see when you go to file your return is the “Your Year in Review” screen. It is a page of check boxes of things that may have happened in your life within the past year that have tax implications. Examples include marriage/divorce, birth/death, college, medical bills, military service, and buying/selling your house. This helps H&R Block determine what forms will be applicable to your tax situation.
- H&R Block’s Help Center is on the side of the screen while you are filling out your return. Do you have a question about the standard deduction versus itemized deductions? Type in your question and a window pops up giving you the information you need. Better yet, your return isn’t interrupted by a screen change.
- If you qualify for H&R Block’s Free File program and you live in Alabama, Arkansas, Georgia, Indiana, Michigan, Missouri, New York, North Carolina, Oklahoma, Oregon, South Carolina, or Virginia, you can electronically file your state return for free. All other state returns are $14.95 each.
- H&R Block Free File does not support certain forms including Form 6252 (Installment Sales), Form 8853 (Archer MSAs), and Form 6198 (At-Risk Limitations). If a form is applicable to you but is not supported, it will give you the option to upgrade to the Basic or Deluxe Edition.
- While there is a help center available, you should have some basic tax knowledge to use H&R Block. I suggest using H&R if you understand your taxes and know your way around the different tax forms.
Bottom line: H&R Block is the best tax preparation software for people who have basic tax knowledge and have an idea about the different types of deductions that apply to them. Despite the fact that H&R Block has some of the best tax software for tax savvy individuals, taxes can be a challenge if you don’t know what you’re doing. There, we’d suggest this isn’t the best online software for beginners.
Visit H&R Block by clicking HERE and get your taxes filed today!
- TurboTax is available for a number of taxpayers:
- People with an Adjusted Gross Income of less than $31,000
- Those with an AGI of less than $57,000 and under the age of 52
- Active military
- If you’re eligible for the earned income credit.
- It is also available for those U.S. citizens or permanent residents meeting AGI or EIC requirements with addresses outside of the United States.
- Filers can electronically file federal returns for free and state returns for $27.99.
- Options are available for taxpayers who do not meet the age or income requirements for Free File. The Basic package is for taxpayers who want additional guidance and is $19.99 for federal returns and $36.99 for state. The Deluxe package is for taxpayers looking to maximize their tax deductions and costs $29.99 for federal and $36.99 for state.
- TurboTax has a Military Edition that walks the men and women in the armed forces through military-related tax situations – including state of residence, uniform deductions, and PCS. It also offers special pricing for military families. These benefits in particular make TurboTax the best online tax software for military families.
- This software asks interview-style questions to walk the taxpayer through the return step-by-step. There is generally one or two questions on the page at a time, which is great for individuals who need guidance or have never filed a return on their own before.
- TurboTax does not expect filers to understand tax jargon. It speaks layman for those individuals who have very limited tax knowledge.
- TurboTax is the most expensive option in terms of filing your state return.
- The income stipulations are a bit more restrictive, with $31,000 being the maximum Adjusted Gross Income for taxpayers who are not active military or eligible for the Earned Income Credit
- TurboTax interrupts your process often to try to upsell the Basic and Deluxe editions.
- TurboTax does not support certain common tax forms including: Schedule C (Profit or Loss From Business), Schedule D (Capital Gains and Losses), and Schedule E (Supplemental Income and Loss).
Bottom line: Despite the cost, TurboTax is best tax software for first-time filers. It is simplistic and guides the taxpayer through his or her return with ease. It is also the best tax preparation software for individuals serving in the military.
Visit TurboTax by clicking HERE and get your taxes filed today!
Well, there you have it! I’ve provided you a a thorough breakdown of the best tax software that’s out there. I hope this overview gave you an idea of which is truly the best online tax preparation software for your particular situation. Happy tax season (for you at least)!