The Best Tax Return Software – Big Help on a Small Budget
Tax season is on full throttle, time to be smart and prepare for your taxes ahead of time to avoid incurring penalties and interests.
Do you still prepare your own taxes the traditional way? And by this, we mean pen-paper-calculator or spreadsheet kind of process? If you’re looking for help but don’t want to rely on a tax professional, you can try using tax software when filing your return.
Related: Preparing your tax return is a necessary step but is only one half of the equation. Can’t pay your taxes in full by April 17, 2019? Know what to do if you can’t afford to settle your taxes on time.
Benefits of using tax software
The convenience and ease of mind that a tax professional can give are paired with a hefty price tag. Needing to shell out huge amounts for a pro is often unnecessary, especially with reliable and user-friendly tax software available on the market.
- Your tax computations can be simplified with the help of a tax software.
- You can be certain with the deductions you are eligible for and credits you can include in your return.
- You won’t miss out on potential refunds.
- It improves accuracy and reduces errors in filling your forms.
- It costs less to use a tax preparation software as opposed to hiring a professional accountant.
So we gave the tax software market a look-see and compiled the best tax return software that will give good value for your money.
Here are 9 of the best tax software that won’t break the bank
Budget range: Free to $89.99
TurboTax is at the forefront of our list because it is arguably one of the best tax preparation software out on the market.
To start, TurboTax allows user-access across devices, from your desktop via their website to your phone or tablet via the TurboTax app. This feature is important because it lets users upload W-2 and 1099 forms directly as photos rather than typing all the information. As an added bonus, if your payroll is provided by a TurboTax partner, you can import directly your W-2 online.
Taxpayers who have relatively simple tax returns can make use of the TurboTax Absolute Zero service. This is ideal for those who rely on a single monthly income, are earning $100,000 or less, and will only claim standard deductions. The service even supports deductions on student loan interests and credits on child care and saver’s tax.
The software asks all the necessary questions in simple language and lets you know where you stand in the process via screen banners. All the information you provide will be entered by the system into the appropriate forms. You can skip some questions in the interview or you can ditch the entire interview itself if you are confident to go straight to the forms.
Taxpayers who are self-employed will find the Expense Finder feature of the TurboTax Self-Employed service very useful and convenient. Although it costs $89.99 for federal filing and $36.99 for state filing, it comes with a free 1-year subscription to Quickbooks Self-employed Accounting Software. Your data on Quickbooks can be easily imported to TurboTax and the software automatically categorizes and deducts the expenses.
TurboTax also offers exceptional customer service: you can chat with tax professionals if you use the online version, and you can even chat face-to-face with its “SmartLook” feature. However, you will really need to shell out money for each additional feature outside of the “extremely simple tax return”. You can maximize the free version if you have simple taxes, but TurboTax makes sure you get every cent’s worth of their paid services.
2. Liberty Tax
Budget Range: $14.95 to $69.95
If you’re a tax software newbie, then you better skip this one. The Liberty Tax software is most ideal for experienced taxpayers who have been doing their taxes for years. It’s mostly because the interface isn’t friendly as it involves a lot of manual clicks and inputs, so you should know what you’re doing.
You can work on whichever aspect of your tax return you choose and Liberty Tax will only make suggestions on forms that may save you some taxes. So it helps to already know what the forms are and which ones you need.
Liberty Tax will warn you in case you input information that may trigger an audit from the IRS. It will also send an email reminder in case you leave an unfinished tax application for too long. Only audit support is available for the user, but you can pay for an upgrade to get an actual audit representation.
With Liberty Tax, you can opt to file your taxes online using the software or file personally in one of over 4,000 US-Canada locations. If you subscribed to an online tax preparation plan but you feel like it’s not working for you, you can just switch to an in-person preparation.
No free version but offers:
- Customer and tech support via chat and email, and basically 360-degree support
- Importing previous years’ taxes even from competitor software
- Credit maximizer and audit assistance services
- Easy switch from online to in-person preparation, with free in-person double-checking of tax returns in participating branches
Comparable to the free or basic versions of competitor tax software, the Liberty Tax Online EZ is for simple tax returns. One edge it has is its capability to include non-resident or partial year state tax returns, ACA forms, and child or dependent care credit. This is the cheapest version which will set you back $14.95 to $35.95.
For those with more complicated tax returns, Liberty Tax Online Basic and Liberty Tax Online Premium is ideal but it will cost you from $28.95 to $69.95. The premium version, however, includes free professional tax advice. If you’re a self-employed taxpayer then you need to spend $39.95 to $43.95 for the Liberty Tax Online Deluxe.
Technically, Liberty Tax isn’t a software that you can download on your devices. However, it still offers similar and comparable services like the ones on this list.
3. Jackson Hewitt
Budget Range: Free to $74.95
Jackson Hewitt offers a free online software version, but it’s only good for filing 1040EZ. If you need to file 1040A, 1040, or more complex tax returns, then you should get one of the 3 paid versions that run from $39.95 to $74.95.
The software is available online so you can prepare your taxes across your devices. It also has a user-friendly interface with notification banners and a left window pane showing a tally of your refunds or amounts owed. It runs an efficient interview-based program that uses your answers to give you a completed tax return. You can easily import W-2 even from a competitor software, but not the 1099 form. It also doesn’t have donation assistance and other planning tools and calculators.
Jackson Hewitt was initially an in-person tax preparation business, but now they are friendly even to the DIY tax beginners. It has features to help out newbies such as “Help Me Decide” which helps you with some basic decision-making and “Occupation Deduction Discovery” which provides deductions eligible for your occupation that you might not know about.
Budget Range: Free to $69.95
If you’re looking to file a simple 1040EZ then you’re good to go with the free version. However, you need to get paid versions for 1040A or 1040 forms. For more complex tax situations, you should get the Premium version to get complete access to all its features. The good thing is, unlike other tax software that could get more expensive as the deadline approaches, TaxAct has a price-lock no matter how long it takes you to complete your return.
Users go through a series of questions that serve as a guide in doing their taxes. TaxAct features a web-program called Life Events that provides 19 different situations with corresponding tips that may be applicable to you. The newest update features an easy upload of a photo of your W-2 form. You can also enter your W-2 form details once and these can be easily imported for preparing your taxes in the succeeding years.
TaxAct has an online platform that provides answers for tax-related inquiries and issues. You can also get customer support from a CPA or an IRS Agent via live chat or phone call (available for paid users). For premium users, TaxAct’s partner company Protection Plus provides 3-year comprehensive audit defense. It costs $39 for all other users.
You can switch devices to continue working on your taxes using the website or app. Similar to other software, it has a banner running across your screen to show where you are in the process.
Those with simpler tax returns such as W-2 employees will find that the TaxAct is enough. However, those who fit in a more complex situation such as self-employment, investment, or property ownership may find this software more difficult to use to complete accurate returns.
Budget Range: Free to $45.95
FileTaxesOnline is a user-friendly tax software that only requires 3 steps: Fill out the simple federal step-by-step questionnaire, continue with providing any additional information needed for your state return, and your completed tax return is sent to the IRS for queuing.
When the tax return is already received and approved, you can download your own copies for free. Tech support is available through email and phone call. Audit assistance is also available for users, however, audit representation is not offered.
FileTaxesOnline allows taxpayers to start their tax return process for free. As long as you fall under “simple tax returns” you can complete your return at no cost.
Receive your refund directly to your bank account – FREE of charge!
You can also directly receive your refund on your bank account at no extra charge. Refund settlement products are available from Refundo, Refund Advantage, Santa Barbara Tax Group, and River City Bank. FileTaxesOnline will forward applications made through the website. You can then opt to have your payment for the tax services debited from your refunds.
However, your price tier can change as you complete some easy questionnaires that serve as your guide in filing your return. You may have to shell out $34.95 to $45.95 depending on the complexity of your tax situation.
Users have to answer a series of questions that serve as a guide in preparing tax returns. This will determine your tax situation and in turn, will determine the price you will be charged with. Everything is pretty straightforward, you won’t be asked to pay additional fees for features you might need for your tax return.
Something that puts FileTaxesOnline ahead of the rest: File Taxes Online actively supports Rise for Hunger.
Rise for Hunger, a non-profit organization working with the United Nations to stop hunger by 2030, receives donations equivalent to a percentage of all fees paid for tax preparation services.
This is deducted from the company’s revenues, and not levied on top of other customer fees. So you know that when you pay to get your tax preparation services, you’re also helping more people get access to healthy foods through FileTaxesOnline’s partner charity.
Budget Range: Free to $55
TaxSlayer was first created for tax experts but now they’ve been improving to include individuals who want to prepare their own taxes. Its free version is only for filing 1040EZ but they offer some of the most competitive prices in the market.
TaxSlayer allows users to complete their returns using a guided or unguided process, depending on their familiarity with their taxes. The guided option is reasonably slower, while the unguided option is similar to a Quick File. Its “Quick File” feature enables users to jump to specific parts of their return by just typing in keyword/s instead of going through lists of links. But for those who find TaxSlayer unfamiliar, it provides a prescribed order of data entry that you can follow.
It’s also one of the easiest software to use when it comes to finding tax credits or itemizing deductions. However, its “Life Events” feature is not as comprehensive yet as the 19-option program of TaxAct. One notable offer is the RefundNOW feature that comes in either a direct deposit or prepaid debit card. Eligible tax filers can get an advance refund of up to $1000 tax-free from River City Bank, TaxSlayer’s trusted partner.
Just like most tax software, TaxSlayer offers free tech support via email or phone. It has an online platform where users can search for tax-related issues but it doesn’t provide audit defense or representation before the IRS. It can only provide audit assistance, which is free for Premium and Self-Employed users and costs $29.99 for other users. Inquiries are sent to tax professionals or Enrolled Agents and you can expect a response is within 1-2 days.
The software is accessible online, so you can continue working on your return across your devices.
7. H&R Block
Budget Range: Free to $94.99
H&R Block is a big name famous for in-person filing, but its software is also top-notch. If along your online tax preparation you feel the need for more audit assistance, you have options to get face-to-face help in over 12,000 locations – for a fee. Although technical support is free for all users, only paid users can avail of live chat and phone support.
The software’s interface is friendly even to beginners; it’s easy to navigate and there’s an online base to search for tax-related concerns. They will also guide you as you go along, redirecting you to useful links for terms that you need to be clarified. You are asked a series of questions to help you in preparing your return.
H&R Block’s More Zero Option is the free version compatible with 1040A and 1040EZ forms, making it sufficient for W-2 filers and other simple tax return filers. If you have a more complicated tax situation, you can purchase the Premium version for $36.99-$69.99. If you’re self-employed, you have to shell out a bit more at $39.99 to $94.99.
This online software allows you to do your taxes across devices and even has a desktop software that saves your information on your computer. Using the app, you can import W-2 and 1099 forms as photos. It even allows users to import previous returns from competitor software on all versions.
You can avail of other add-ons, such as “Worry-Free Audit Support” for $19.99 which includes audit representation, IRS correspondence management, and audit preparation. Another add-on you can purchase is the “Tax ID Care” at $14.99, which assists in applying for an Identity Protection PIN in case criminals try to use your information to file for tax returns.
8. Credit Karma
Budget Range: Monthly $30 subscription
Credit Karma is a company that offers credit monitoring service. But recently, they launched a tax preparation service that’s free to use. However, only those who have subscribed to their credit monitoring program for about $30 monthly can maximize their tax return software. That’s already a great bargain considering their free software supports almost all major forms.
It’s similar to other tax software: you are asked a series of questions and your answers will be used on your tax return. There are no life events feature, but Credit Karma will guide you through the process. You can also opt to work on whichever aspect of the tax you want to work on. The interface is user-friendly and you can see a tally of your tax refunds on the dashboard.
This is the only free software that offers advance refunds via their trusted partner MetaBank. Early filers may apply for the advance as an interest-free loan in the amounts of $500, $750, or $1000 debited on an American Express Serve Card. MetaBank will repay the loan to the IRS once they receive the full refund amount and will send the remaining balance to you.
The company is fairly young, so you can’t expect much from their help and support services. They do offer live chat support with a tax professional 24/7, but they are struggling with tech support as email inquiries might get delayed responses.
Budget Range: Free to $12.95
Don’t be fooled by its name, FreeTaxUSA isn’t completely free like the Credit Karma. However, it’s still one of the most affordable options with inclusive services. Although it’s great for simple returns, it can also work well for other complex major forms.
This tax software has a simple and friendly user-interface. As you complete your return, pop-ups will ask you questions that serve as a guide in filling out your forms. You can skip some questions, or the interview itself if you feel confident going straight to the forms.
Banners at the top of your screen track the steps you have completed. You have a bookmark option for pages and links that you want to get back to later. You can even import returns from a competitor software so you can review your year-by-year taxes.
Upgrade to Deluxe
It’s pretty straightforward once you purchase the $12.95 state filing since there won’t be any “upsells” or additional features you need to pay to unlock certain features. You can upgrade to Deluxe if you want, which will give you priority to audit assistance and access to a tax specialist in case you get audited by the IRS.
However, FreeTaxUSA only offers audit help and not audit representation in the case that IRS audits you. While all users have access to an online knowledge base to search for tax-related inquiries and customer support via email, only paid deluxe users can receive live chat support.
Better start cracking!
As a beginner or a dyed-in-the-wool tax DIY, there’s something for everyone. Whether you want free software or some locus of control, what matters is that you file on time.