Tax season is fast approaching, and choosing the best tax software is a key step in preparing to file your taxes. We reviewed several tax software providers, and TurboTax is one of our top picks, largely because of its easy-to-navigate website and generally easy-to-follow tax-preparation process.
Unlike H&R Block, TurboTax has no physical store locations, and it’s more expensive than many of its competitors. However, it offers robust customer service and an easy-to-use online process.
| Cost for DIY version |
|
| Does it offer a free version? | Yes, with some restrictions. |
| Standout features |
|
Best for
You might like filing with TurboTax if you:
Not recommended for
You might not like TurboTax if you:
How much does TurboTax cost?
TurboTax offers a range of prices for its tax filing services. Keep in mind that these prices fluctuate, and tend to increase as the tax-filing deadline approaches. Also, you’ll pay extra for additional support.
The basic do-it-yourself option costs between $0 to $89 for federal filing. One level up, the Live Assisted option costs $89 to $219 for federal filing and includes unlimited assistance and a final expert review, though you’ll work with a pool of experts rather than a single dedicated person. Finally, the Live Full Service option starts at $129, but could top $2,000 if you have a complicated tax return that requires multiple tax forms. That option includes a dedicated tax expert who will complete and file your income taxes.
The company also sells desktop software ranging from $50 to $130. It’s best for those who don’t require expert guidance.
Tax-filing products offered by TurboTax
TurboTax offers three online tax-filing options: Do it yourself, Live Assisted and Live Full Service.
-
Do it yourself: As with other online tax filing services, the free version of TurboTax’s DIY option is available to a limited group: those filing Form 1040 with only a small number of credits and deductions. Around 37 percent of filers qualify, according to TurboTax. If you don’t qualify for free filing, the DIY plan costs up to $89. The cost to include a state filing is either free or $64 per state, depending on your situation.
-
Live Assisted: This version ($89 to $219) may be best for those who want expert assistance and year-round support when filing their tax return. This option includes a final expert review, and support in the event of an audit. State-level filing costs $59 or $69 per state.
-
Live Full Service: This most expensive option is ideal for a filer who wants an expert to handle all the heavy lifting. The cost starts at $129, but it rises for more complex situations that require additional tax forms. The most complicated situation we could come up with, using multiple in-depth tax forms, came to an estimated cost of more than $2,000. The Live Full Service option gets you an expert matched to your situation, with whom you can meet on the phone or virtually. The expert will also file and review your taxes for you, all online. State filing costs an additional $69 per state.
TurboTax’s free options are available to taxpayers who have W-2 income and claim a handful of common credits and deductions, such as the standard deduction, earned income tax credit, child tax credit and student loan interest deduction.
TurboTax also offers desktop software downloads that fall into four categories.
-
Basic: This $50 offer includes five federal e-files, step-by-step guidance, and educational sources covering the latest tax laws. Transferring your tax information to your state costs an additional $45, and there is another fee of $25 for state e-filing (alternatively, you can print out your state return for free).
-
Deluxe: This option includes five federal e-files and caters to those aiming to maximize their deductions. Unlike the Basic plan, one state download is included in the Deluxe plan’s $80 cost, but state e-file costs an additional $25.
-
Premier: This option is best for filers with more complex situations, like investments or rental properties. It costs $115 but includes five federal e-files and one state download. As with the other options, there is an additional $25 fee to e-file your state income tax return.
-
Home & Business: At $130, this is the most expensive download option, and it’s best for self-employed people. It boasts extra guidance on rental property income, retirement taxes, investment sales and deductible costs. It includes five federal e-files, one state download and an additional $25 fee to e-file the state income tax return.
Note: Tax software prices change frequently, and often increase as April 15 approaches. Check TurboTax’s website for the most up-to-date pricing.
Who should use TurboTax’s tax service?
TurboTax can make the intimidating process of filing your taxes more manageable. You won’t see a lot of complicated jargon; the company breaks down complex terminology into easy to understand instructions throughout the filing — even in the free version. But if you don’t qualify for the free version, the convenience of easy-to-follow instructions comes at a higher cost than you may pay for other tax-filing services.
If you prefer to sit down with a tax professional, heading to one of H&R Block’s offices may be a better route. If you feel confident in your tax knowledge, then TaxSlayer could be the perfect tax software program for you.
About TurboTax’s tax service
Intuit, which owns TurboTax, has more than 18,000 employees worldwide and serves over 100 million customers with a range of product offerings. TurboTax was founded in 1984 and sold to Intuit in 1993. Its tax experts must complete training, and when you’re matched with an expert, you can view their credentials.
Filing can be handled online or through one of TurboTax’s downloadable products. Filers are walked through a simple questionnaire where they answer questions about their tax situation. The program then fills in the tax forms, and either sends the tax forms directly to the government or gives filers the ability to print them out.
Read the full article here