For most of us, it’s tax season again, and we’re looking for the best tax software to keep Uncle Sam at bay. W-2, 1099s, dividend reports and other tax documents have already begun arriving in the mail, and the countdown to April 15 is has begun. Don’t expect a delayed filing date like in 2020, by the way—that was a one-time deal thanks to lockdowns and massive uncertainty over how the global pandemic would affect the economy.
So with about two months left to file, your 2021 tax situation may be more confusing than ever. You might need to account for unemployment insurance and stimulus payments, for example. Even if you traditionally complete your taxes yourself, this year could be complicated enough that you need to get some help.
The good news? You probably don’t need to hire a tax accountant. There are a slew of tax prep software packages out there, and the best tax software can make the process, if not enjoyable, at least simple and straightforward. With seven excellent choices (including the always-popular TurboTax, TaxAct and H&R Block) to choose from, there’s a tax solution here to help you file on time and with the confidence you’re paying the right amount.
- Best Online Tax Service Overall: TurboTax
- Tax Filing Service with $100K Guarantee: TaxAct
- Best Online Tax Filing Service With Human Help: H&R Block
- Best Free Online Tax Filing Service: Credit Karma
- Best Online Tax Service Prices: TaxSlayer
- Best Tax Software for Transitioning to a Real Tax Pro: Liberty Tax
- Online Tax Service with Best Satisfaction Guarantees: Jackson Hewitt Tax Service
Best Online Tax Service Overall
TurboTax
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TurboTax is among the oldest tax prep software solutions available—it got its start way back in 1984 and has had decades to hone both its interface and business model. As a result, TurboTax is especially straight-forward to use. Its step-by-step questionnaire is easy to follow whether you have a simple or complex tax situation, and its rich database of help and support articles makes most tax issues easy for ordinary people to understand.
If there’s any complexity, it’s in the sheer number of plans and options to choose from. TurboTax Basic—for simple returns—is free. There’s also TurboTax Deluxe ($60), Premier ($90), and Self Employed ($120). Want TurboTax’s superb live support? If you upgrade to TurboTax Live, you can chat with a real tax professional while you’re working on your taxes and get a professional review of your return before you file it. That raises the price of TurboTax Deluxe to $120, though, and Premier to $170.
But there’s more. Want to let the pro do everything for you? That’s an option, too, in a tier called TurboTax Live Full Service. The Live Full Service might sound appealing, but it’s also quite expensive—TurboTax Live Full Service Premier is $260. Most users will be fine sticking with the self-service or Live versions unless you have had a truly ludicrous tax year. No matter which version you choose, you don’t pay until you have completed the return and you’re ready to file.
Tax Filing Service with $100K Guarantee:
TaxAct
TaxAct’s biggest selling point, made clear on the site’s homepage, is that it’s less expensive than the industry leader TurboTax. Even so, there are definitely cheaper options (Credit Karma is completely free, for example). The service works roughly the same as TurboTax, offering a straightforward interview-style wizard to walk you through the process of completing your return.
Like TurboTax, there are several subscription levels available. You can do your taxes for free if you have a very simple return, or step up to TaxAct Deluxe (for homeowners) for about $20, Premier (which handles investments) for $28 or Self Employed for $52. Need additional help? TaxAct’s Xpert Help is similar to the Live assistance that TurboTax offers, with unlimited access to a tax expert to answer your filing questions anytime they arise.
If you have an especially onerous tax situation, you might also be intrigued by TaxAct’s $100k Accuracy Guarantee. Essentially, if you get audited and there’s a difference between what you really owe and what TaxAct calculated, TaxAct will refund the cost of the software plus pay any difference in your tax liability as well as legal costs associated with your audit up to $100,000.
Best Online Tax Filing Service With Human Help
H&R Block
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Thanks to its H&R Block’s brick-and-mortar business that’s been around since 1955, this service has even more name recognition than TurboTax—though the DIY tax prep software didn’t get its start until 2004. You can file for free or take advantage of H&R Block’s Deluxe ($50), Premium ($70) or Self-Employed ($110) plans. H&R Block’s interview-based tax prep is pretty much the same as what you’ll find elsewhere, though the online tech support is excellent and you can add unlimited live help from tax experts to any of the regular plans. The cost varies—it’s $70 for the Deluxe plan, but $110 for Premium, for example. The latter lets you share your screen with a tax pro for even more effective help.
Every tax prep service includes slightly different elements in each of its plans, and H&R Block should be especially interesting to those looking for the free version; unlike most others, it includes the ability to claim things like alimony and certain kinds of business income. Another way that H&R Block distinguishes itself: in addition to doing your taxes yourself, you can choose to upload your info and let a tax professional file for you, even meeting with the tax preparer virtually.
Best Free Online Tax Filing Service
Credit Karma
Most tax prep services offer the ability to file for free, though these companies really want to funnel you into a paid tier, so it really only works if your tax situation is pretty simple. Credit Karma is different—it’s free, period, for both federal and state taxes. That means even if you have a mortgage, itemized deductions, investments, and a side business that pays you in 1099s, you can file with Credit Karma for free.
Of course, you get what you pay for, and while the site’s interview-style workflow is good, it’s not great. Various screens are sometimes inconsistent and don’t always carry over information you need on future screens. Help isn’t nearly as detailed or user-friendly as you get at sites like TurboTax and TaxAct, which is understandable because those more established services have had decades to build a super-user-friendly application.
Even so, Credit Karma stands behind its product with a free audit defense, accuracy guarantee (up to $1000) and a refund guarantee that will pay you up to $100 if you can get a bigger refund or lower liability when filing with another tax app.
Best Online Tax Service Prices
TaxSlayer
If TurboTax has the most convoluted pricing system with more than a dozen pricing levels, TaxSlayer is among the simplest. You choose Free, Classic, Premium or Self-Employed. Free helps you complete a simple 1040—nothing more—and includes a state return as well. The $17 Classic plan includes all the forms, but is completely DIY. Want priority phone and email support and access to a tax pro, plus 3 years of audit assistance? That’s the $37 Premium plan. Finally, Self-Employed costs $47 and tacks on specialized assistance (both in-the-app and via access to a tax professional) for self-employed filers.
Unfortunately, the DIY approach is hobbled a bit by content that is less helpful than a frazzled late-night last-minute tax filer might like, and the interface is sometimes a little confusing. But if you start your taxes early and make use of the support options, TaxSlayer is a great value.
Best Tax Software for Transitioning to a Real Tax Pro
Liberty Tax
You might not know the name, but like H&R Block, Liberty Tax is a brick & mortar business that introduced tax prep software some years ago, and serves as an alternative to services like TurboTax and TaxAct. There’s no free option here, but Liberty Tax keeps things simple with three tiers: Basic ($45), Deluxe ($65) and Premium ($90). If you need more than a simple 1040 completed with a W-2 and unemployment claims, then Deluxe offers a little more (including Schedule C) and Premium covers the full gamut of self-employment topics.
While Liberty’s questionnaire is competently organized and most people will be able to get through it without too much trouble, the service is light on assistance. The help isn’t as rich as what you’ll find in an app like TurboTax, and there’s no option to get real-time video chat help from real tax professionals as a part of the process like you can with other services. But if you get stuck, Liberty makes it easy to transition from DIY online to completing your return at a Liberty Tax office, where it can be finished by a tax pro.
Online Tax Service with Best Satisfaction Guarantees
Jackson Hewitt Tax Service
The best reason to use Jackson Hewitt’s online tax prep service is if you are already a customer of Jackson Hewitt’s traditional brick-and-mortar tax service and want to continue using it in a DIY capacity. It’s also nice to see such a simple pricing model: Pay $49 for federal and state combined, or $25 for a federal return only. This can be substantially less expensive than other tax services (though it’s not the cheapest, and Credit Karma is completely free).
You might also appreciate Jackson Hewitt’s trio of guarantees. The company will pay interest and penalties for you if the site caused an error in your return. Jackson Hewitt will also refund its fee if you can get a larger refund (or smaller tax liability) with another tool—and then there’s a 100% satisfaction guarantee as well.
Otherwise, Jackson Hewitt’s online filing system is similar to what you get with any of the competitors—a step-by-step questionnaire—but the integrated help and support isn’t as comprehensive as what you’ll find elsewhere. You can live chat with support, though, if you get stuck.
