The Most Popular Online Tax Programs
Consumers can save money by preparing your income taxes yourself. While doing them yourself once amounted to piles of paperwork and mountains of forms, today’s self-preparer only needs a simple software program to complete the complex Internal Revenue Service (IRS) forms. Some software charges nothing for its use to users below a prescribed income tax bracket. Most programs charge a minimal fee compared to the up to $275 charge for a professional tax preparer.
At one time, the consumer had to purchase software off the shelf and install it. The Software as a Service (SaaS) revolution changed that. This article looks at SaaS options the consumer can use to prepare their taxes online without a pro or the knowledge of one. The programs chosen offer:
- reasonable pricing
- easy to use interfaces
- a guided, question and answer process
- super customer support
The list below takes an in-depth look at the most popular online tax programs. Other options exist, such as the relatively new Credit Karma freebie software, but these three options discussed form the most popular choices for do-it-yourselfers (DIYers). While programs like TaxSlayer remain popular with the professional preparers for which it was developed, the programs discussed in-depth provide the best options for the inexperienced filer.
1. TurboTax
For a small investment of $59.99, the consumer obtains the top personal tax preparation program. It’s free if your use TurboTax Absolute Zero to complete Form 1040EZ or Form 1040A. Developed by Intuit, it offers a bevy of features most programs don’t. It can import a number of employer tax IDs and lets the user upload photos of their W-2 forms and 1099 forms. This reduces the chance of making a typo or entering the wrong number in a blank. It includes an “Expense Finder” question and answer interview to help self-employed filers maximize their tax savings while properly preparing their Schedule C. Linked to the consumer’s bank account, it suggests tax deductions from the bank transactions. It categorizes them and tallies them for the user. Intuit programmed Turbo Tax to function as a professional tax preparer would, conducting via prompt questions the interview a filer would undergo in a face-to-face meeting. Even with the Q & A, complicated taxes can become confusing. Don’t worry because TurboTax offers tax experts via chat or video chat. You can even request audit assistance via the “SmartLook” feature. It offers a free version and its paid versions include: Deluxe for $59.99, Premier for $79.99, Self-Employed for $119.99 and TurboTax Live for $179.99. The consumer can add a state return to the free version for $29.99 and $39.99 for any of the paid versions.
2. H&R Block
H&R Block also offers multiple versions with a vast range in pricing: More Zero for free and Premium for just under $70 with a multitude of in-between levels. Both versions also use the Q & A method. This software doesn’t handle open-ended responses as well as Turbotax, leading consumers to use the help files more often. Its website offers unlimited consultations via chat with a tax pro. Although its artificial intelligence works a little more clunkily than Intuit’s program, it offers human support in multiple ways. If the consumer purchased Premium and gets stuck, they can go to any H&R Block office in the US for free in-person help. With either version, for a small fee, the consumer can have their completed return reviewed by an expert. Its paid versions include: Deluxe for $49.99, Premium for $69.99 and Self-Employed for $94.99. The free version charges $29.99 for filing of one state income tax form while the paid versions charge $39.99.
3. TaxAct Premium
TaxAct Premium offers the least expensive option of the three, starting at $14.95, and offers a “price lock” guarantee. It lets the consumer start the return early in the year and plug numbers in as the months progress with no change in the charges. That’s a big difference from both the Intuit and H&R Block offerings. It offers tips and tricks to implement if the consumer experienced any of 19 major “Life Events” including the adoption or birth of a child, purchase of a home or marriage. It also features step-by-step guides for the self-employed and those with investment income. Like the other top programs, it offers live customer service and a detailed Tax Tutor Guidance Center. It was previously known as Personal TaxEdge. It offers four versions: Basic for $14.95, Plus for $39.95, Freelancer for $59.95 and Premium for $69.95. A state return costs $17 to add to the free or Basic version, but $39.99 for all other versions.