Few people look forward to filing tax returns, but you might hate it less if you receive a refund. As of Sept. 1, the IRS had issued almost 109 million refunds — over $300 billion — so far in the 2017 filing season. You need to file a return to get your refund, though. With a computer or smartphone and an internet connection, you can file taxes online with several companies, either through their websites or by purchasing software to download. Here are some pros and cons to help you decide how to file your own taxes.
|Best Tax Software and Services|
|Company||Online Tax Filing Price||Downloadable and CD Software Price|
|TurboTax||$29.99 to $154.98||$79.98 to $109.99|
|H&R Block||$29.99 to $119.98||$59.99 to $79.95|
|TaxAct||$0 to $88||$52 to $76|
|TaxSlayer||$0 to $55||Not offered|
|Credit Karma||Free||Not offered|
|USTaxFiler||$60 and up||Not offered|
|The price ranges represent the lowest and highest price points for filing state and federal returns. Information is accurate as of Nov. 19, 2017.|
TurboTax is probably the best-known tax preparation company, but that doesn’t mean it has the lowest price. It offers some great features that make it easy to use, though, such as the ability to use TurboTax products on any device including your phone. You can even save time by entering your W-2 information simply by snapping a picture of the document.
TurboTax guarantees you’ll receive the maximum refund or it will refund the purchase price. The company also guarantees that all calculations will be 100 percent accurate, or it will pay any IRS penalties and interest. TurboTax also offers free year-round audit support. Another unique feature of TurboTax is SmartLook, which allows you to talk to an expert live on screen.
Depending on the software version you choose, you could pay $150 or more to do your taxes through TurboTax. Here’s how much using the TurboTax software will cost you:
TurboTax Online Versions
- Federal Free Edition: $0, plus $29.99 for state returns — designed for those using 1040EZ or 1040A forms
- Deluxe: $54.99, plus $39.99 per state — designed for those whose taxes include mortgage or property tax, itemized deductions, donation deductibles, etc.
- Premier: $79.99, plus $39.99 per state — designed for filers with investments and rental property
- Home and Business: $114.99, plus $39.99 per state — designed for small business owners and independent contractors who use Schedule C
TurboTax Downloadable and CD Versions
- Basic: $39.99, additional $39.99 per state, plus $19.99 for state e-file; free federal e-file
- Deluxe: $69.99, one free state, $39.99 for each additional state; $19.99 to e-file the state return
- Premier: $99.99, one free state, $39.99 per additional state; $19.99 to e-file state return
- Home and Business: $109.99, one free state, $39.99 per additional state; $19.99 to e-file state return
Pros of TurboTax:
- Comprehensive coverage of tax issues
- Live chat help
- Option to pay for TurboTax service out of your refund
- Guides you through recent tax changes
- Imports previous years of TurboTax data
- Easy to use
Cons of TurboTax:
- Costs more than some competitors’ software
- Some forms and schedules not supported in all versions
H&R Block Review
Another familiar name in the tax-preparation game, H&R Block’s online software offers many great features, such as importing your income information from your prior year’s tax return, even if you used a different tax preparer, so you don’t have to re-enter all the information again. H&R Block also guarantees that you’ll receive the maximum refund possible. It also allows you to use its software to amend your return without any additional charges. Plus, it will pay up to $10,000 if you incur extra taxes because of a software miscalculation, and will support you in the event of an audit.
H&R Block Pricing
The H&R Block fees for filing start at $29.99. Here are details on the cost of different versions:
H&R Block Online Versions
- Free: Free federal and $29.99 state returns — designed for first-time tax filers or simple tax returns
- Deluxe: $54.99 federal, $39.99 for each state return — designed for homeowners with deductions
- Premium: $79.99 federal, $39.99 for each state — designed for investors or small business owners
H&R Block Downloadable Software Versions
- Basic: $19.95 plus $39.95 for state software; $19.95 per state for additional state e-file
- Deluxe and State: $44.95; includes one state with additional states for $39.95 each, plus $19.95 for additional state e-file
- Premium: $64.95; includes one state with additional states for $39.95 each, plus $19.95 for additional state e-file
- Premium and Business: $79.95; includes one free state with additional states for $39.95 each and $19.95 for additional state e-file
Pros of H&R Block:
- Option to pay for service from your refund
- Tax Research Institute assistance with tax changes and strategy
- Brick-and-mortar locations available
- Offers 24/7 support from Jan. 16 through April 21, with extended business hours all other times of year
Cons of H&R Block:
- Does not offer free basic filing
TaxAct offers a range of online and downloadable tax prep products from free filing up to its Premium version that includes Audit Defense. You have unlimited access to support when filing your return, but you must call when TaxAct is open. TaxAct doesn’t have around-the-clock customer support, but it is open for service on weekends. TaxAct also offers a Price Lock Guarantee — you can order your services now to lock in your price but pay later, when you file your return.
TaxAct has four online versions and three software versions to choose from.
TaxAct Online Versions
- Free: Free federal and state returns and e-filing — designed for simple returns using 1040EZ and 1040A
- Plus: $25, plus $37 per state return — designed for filers with mortgages, investments, charitable donations and more
- Freelancer: $39, plus $37 per state — designed for independent contractors and self-employed filers
- Premium: $51, plus $37 per state return — includes the features of the Freelancer version with the addition of Audit Defense
Related: How to File Self-Employment Taxes
TaxAct Downloadable Versions:
- Basic: $15, includes five free federal returns; state return is $37; e-file additional
- Plus: $62; includes one state return; e-file additional
- Freelancer: $76; includes one state return; e-file additional, includes Schedule C assistance
Pros of TaxAct:
- Lower price
- Version specifically geared toward freelancers
- Guaranteed price
Cons of TaxAct:
- Support not available 24/7
TaxSlayer offers four different online products for filing your income tax returns. For its Simply Free option, as long as you use Form 1040EZ, you don’t have to pay for federal or state returns. All products offer live phone support. If you want features like Audit Assistance, Ask a Tax Pro, Priority Support, or Live Chat Support, however, you’ll need to use either the Premium or Self-Employed versions.
Although TaxSlayer guarantees to cover all “major” tax forms, there might be forms that are not covered. If you are using any version other than Simply Free, you can also compare your return with your prior return to see how your numbers have changed and make sure you didn’t miss anything.
Check out the pricing on this affordable option for filing your taxes. You’ll pay $0 for the Basic version, and the Self-Employed version starts at $55 and includes state tax filing.
For Freelancers: How to Calculate Estimated Taxes
- Basic: Free federal and state filings — designed for filers using Form 1040EZ
- Classic: $22, plus $27 for state return — includes all major forms and schedules; can import last year’s taxes
- Premium: $40, plus $27 for state return — includes all the features of the Classic edition, plus additional customer assistance
- Self-Employed: $55, state return included — best for taxpayers with self-employment income
Pros of TaxSlayer:
- Lower price
- Prepare from any device
Cons of TaxSlayer:
- No live chat — email and phone help only
- Only available online
Credit Karma Review
For truly free tax service, look no further than Credit Karma. Credit Karma doesn’t support all income tax forms, but it covers many of the important ones. Credit Karma’s forms do not support multi-state returns, part-year resident state returns, foreign earned income, married filing separately in community property states, state-only returns and certain types of business tax. Returns with any of these components can’t be accommodated. To begin, you must sign up to be a Credit Karma member, which is free as well.
Credit Karma Pricing
Credit Karma returns are free.
Credit Karma Online Version
- Free: For 1040EZ, 1040A or 1040 filers
Pros of Credit Karma:
- No upsells
- Customer support team
Cons of Credit Karma:
- Some filings not supported
- Must sign up for Credit Karma
- Not available for download
USTaxFiler has been existence for over eight years as part of Global Tax Solutions and has processed more than 70,000 returns. The firm offers à la carte options for filing your income tax returns based on the forms you need to include. USTaxFiler touts experience with foreign accounts on its website to help you comply with Foreign Bank Account Reporting and Foreign Account Tax Compliance Act requirements.
USTaxFiler fees start at $30 per federal return and $40 for joint returns where both spouses have income, plus an additional $30 per state return. Additional fees for specific IRS forms include:
- Premium Tax Credit/Reconciliation of Form 1095-A: $20
- Schedule A Itemized Deductions: $70, minimum
- Education Credit: $15
- Moving Expenses: $15
- Child and Dependent Credit: $15
- Schedule C or Schedule E: $50; $15
Pros of USTaxFiler:
- The firm comprises enrolled agents, certified public accountants and registered tax return preparers from international accounting firms and offer additional services, from foreign bank account reporting to filing taxes in India for U.S.-based clients.
- In addition to its standard reimbursement policy, USTaxFiler offers an optional one-time $30 fee for lifetime support and reimbursement for penalties, not interest, levied by tax agencies for accuracy-related issues.
Cons of USTaxFiler:
- No live chat online — email or phone help only
- The separate prices for different forms that are not included in the standard state and federal filings could increase the base price.
Decide If Online Filing Works for You
Whether you file a personal tax return or own a small business, there is an online tax filing or tax software that will enable you to file taxes online this tax season. Even the best tax service programs won’t do all the work for you, though. If you’re not confident in your ability to navigate tax software, call a professional to help you figure out how to file taxes, or seek out free tax assistance that is offered in many cities and towns.
Next year there will be another company in the mix. Jackson Hewitt, which currently has tax preparation offices, will offer an online service beginning with the 2018 tax year. The company will offer three pricing levels, but the prices and the differences are not yet listed on the company’s website.