Prices updated as of January 27, 2022
Tax season has arrived and it will help to become familiar with the best tax software available before the fact.
There are plenty of them available, and more coming online all the time. Though they all have the same objective – to enable you to prepare your tax return on your own – there are enough differences that certain software will work better for you than others.
But finding the best tax software isn’t easy. You’ll need to read reviews like this one, and maybe even go through some trial and error.
We’re going to make your job easier by providing the details of seven of the most popular tax software plans available.
Best tax software compared overview
Free Version? Other Plans Customer Support Refund Tracking
TurboTax For simple tax returns only Deluxe: $39
24/7 live support over the phone Yes
Cash App Taxes Yes N/A 24/7 live support over the phone or through the app Yes
TaxSlayer Yes Classic: $17.95
24/7 live support over the phone or chat. Email form also available Yes
Liberty Tax Online N/A Basic: $24.95
24/7 live support through the app. Email support available every day from 9:00 a.m. to 12:00 a.m. EST Yes
H&R Block For simple tax returns Deluxe: $29.99
Support over the phone or at a physical location Yes
TaxAct For federal tax returns Deluxe: $24.95
Support over the phone or email. Hours vary Yes
E-File For federal tax returns Deluxe: $20.99
Premium Plus: $37.49
Support over email. Some versions include phone support as well Yes
TurboTax has established itself as the gold standard in tax preparation software. It offers a highly intuitive interface, using a simple question-and-answer format. You don’t need any previous experience preparing tax returns to use it. TurboTax also offers generous support and tools, helping you at every step of the way.
They offer their 100% Accuracy Guarantee. If you have to pay a penalty due to an error made by TurboTax, they’ll pay both the penalty and interest. They also offer a solid audit support provision with each plan. And if you need direct audit representation, at just $39.99 for individual returns and $59.99 for small businesses. That’s a fraction of what you would pay a CPA for similar representation.
For an additional fee you can get direct tax preparation assistance from a tax expert.
The tax professional can even access your computer screen, enabling you to work on your return together.
But if you’d like to hand your taxes to someone else, you can do that as well. With TurboTax Live Full Service, a tax professional takes care of the entire filing process for you. (Additional fees for TurboTax Live and TurboTax Live Full Service are listed below under each TurboTax version).
TurboTax comes in five different versions:
TurboTax Free Edition
TurboTax Free Edition is available for simple returns. You must have W2 income only, have limited interest and dividend income, claim the standard deduction, or be eligible for either child tax credits or the earned income credit.
With this version, it’s free to both prepare and file your federal and state tax returns.For simple tax returns only. Not all taxpayers qualify.
TurboTax Deluxe is available for $39 for the federal return, plus $39 for your state return. The plan can accommodate form 1040, and allows for itemizing deductions.
Fee with TurboTax Live: $119 + $49 for each state return
Fee with TurboTax Live Full Service: $249 + $49
TurboTax Premier is available for $69, and $39 for your state return. This version can accommodate investments and rental properties. It’s also good for stocks, bonds, crypto, employee stock plans, and any other investment income sources.
TurboTax Premier also provides one-on-one help from a TurboTax specialist.
Fee with TurboTax Live: $169 + $49 for each state return
Fee with TurboTax Live Full Service: $359 + $49
This is the TurboTax premium version. It’s priced at $89 for the federal return, and $39 for your state return. It can be used for any type of tax return, but particularly for those who are self-employed.
It can even enable you to prepare W2s and 1099s if you have employees or contractors. It also integrates with QuickBooks Self Employed, which is itself a popular software program among small businesses. And like TurboTax Premier, it also comes with one-on-one help from a TurboTax specialist.
Fee with TurboTax Live: $199 + $49 for each state return
Fee with TurboTax Live Full Service: $389 + $49
TurboTax also offers TurboTax Business. For $160 on federal returns, and $50 per state return, you can prepare business income taxes for partnerships, S corporations, C corporations, multi-member LLCs, trusts, and estates.
This plan also enables you to generate unlimited W2s for employees, K-1 forms for partnership distributions, 1099s for contractors, and for payment of interest and dividends. You can even prepare returns for multiple businesses.
Cash App Taxes
When it comes to filing taxes, you can’t beat free. With Cash App Taxes, you get free tax filing without the bugs and limitations you see with other free software. That said, the software does come with limitations. Although most taxpayers can use the service, there are some forms the platform doesn’t support.
Before you get started with Cash App Taxes, review the list of unsupported forms. If you’re filing in more than one state, you’ll need to search elsewhere, as is the case if you received funds from a trust or estate. Most common forms are supported, though, so it may be easier to search to make sure the forms you commonly use are included.
There is only one version of Cash App Taxes, and that’s the free version. The process is fairly painless, as tax software goes, thanks to Smart File. Input some basic details and the software shows you only the sections you need to complete. As with many free tax-filing options, Cash App Taxes lets one-form 1040A filers snap a photo of the form and upload it for easy filing.
The only caveat is that you’ll need to download and create an account on Cash App to use Cash App Taxes. Still, the app is free and you’ll get access to many money management, and investment tools. Those who already have a Cash App account can just log in and start filing.
It may be free, but Cash App offers the same premium features you get from other platforms. Cash App guarantees its calculations are correct and that you’ll receive the maximum refund…or you’ll get the difference owed, with a maximum of $100. Cash App will also provide consultation and assistance in the event you’re audited.
Cash App Taxes can work for most taxpayers. However, its limitations mean you need to check the list of unsupported forms before you get started. As long as you lived in the same state for the entire tax year, Cash App Taxes will likely be able to handle your return.
With the free price tag, Cash App Taxes offers more comprehensive features, in an easy-to-use format, than many higher-priced competitors. That alone makes it worth considering. Existing Cash App users will likely find this one an easy choice, since it’s on a platform they already use.
Learn more about Cash App Taxes – See details.
TaxSlayer is one of my favorite options this year. Not only did they add several Covid-19 related features, but they’ve now upgraded their platform to be even more user-friendly.
Being a self-proclaimed “customer-obsessed” company, TaxSlayer made the process of doing your taxes both online with your computer and your mobile app smooth and straightforward. They’ve added new resources, too, like a refund estimator that calculates how much you can expect to receive in a refund with just a few inputs.
And best of all, their pricing didn’t change much from last year, beating competitors like TurboTax, H&R Block, and TaxAct with similar products. Here’s a breakdown of each of their options:
Simply Free is $0 for your federal filing, and your state filing costs nothing, either. It’s truly free. Simply Free is best for those who want to start, prepare, and file basic 1040 returns. You can upload your prior years’ tax returns and compare this years’ to your prior years’ returns. You’ll also get phone and email support and 100% accuracy guaranteed.
Classic costs $17.95 for federal and $36.95 for each additional state you file in. This is best for most common tax situations. With this version, you have the ability to fast-fill your W-2 information. You can either populate it with last year’s information or import your W-2 and TaxSlayer will autofill everything for you. You’ll receive coverage for all credits and deductions and all income types. Plus, you’ll get free IRS inquiry assistance and 100% accuracy guaranteed.
Premium is a bit of an upgrade over Classic and costs $37.95 for federal and $36.95 for each additional state filing. You’ll get everything covered in Classic, plus priority support via live chat while you’re doing your taxes. You also get the ability to ask a tax professional questions through one-on-one help for your toughest tax questions with unlimited, personal guidance. This is a great option for those who need some extra support with their taxes.
This option is best for those who are self-employed or have more complex tax situations. It costs $47.95 for federal taxes, plus $36.95 for each additional state filing. Whether you’re a side-hustler, freelancer, or you own a small business, this version will keep you in line with everything you need to file. You get additional tax tips and support with this version, tax payment reminders, and support for 1099 and Schedule C. Plus everything else that’s included with Premium.
Liberty Tax Online
Liberty Tax Online – along with H&R Block – has a major advantage over pure tax software plans. In addition to their tax software, they also have a very extensive network of tax preparation offices and tax professionals. You can even integrate both. You can start with the tax software, but if you decide you need help, you can get it from one of the company’s tax professionals.
Another advantage is that it combines a moderate price level with a very high level of service. It can accommodate everything from very simple returns to those that are very complex.
- Basic Package: $24.95 + $36.96 for any additional state returns
- A simple tax situation, such as being single or married with no dependents, and taxable income less than $100,000. Millions of taxpayers qualify.
- Deluxe Package: $44.95 + $36.96 for any additional state returns
- Lifestyles that are a bit more complicated. You know – kids, investments, child care, college, homeownership.
- Premium Package: $64.95 + $36.96 for any additional state returns
- Taxable income over $100,000, self-employed, such as a freelancer or contractor, or those who have other less common forms of income.
With that in mind, below is a summary of each of the three Liberty Tax Online plans:
Liberty Tax Online Basic
This version is the plan for simple returns. You must have a taxable income of less than $100,000, no dependents, and claim the standard deduction.
Income sources are limited to W-2 wages and salaries, unemployment income, and taxable interest income of less than $1,500. But it can also accommodate taxable scholarships, fellowship grants, tips, Alaska Permanent Fund dividends, and the earned income credit.
Liberty Tax Online Deluxe
This version is available for more complicated returns. It can accommodate taxpayers with children and other dependents, itemize your deductions, and have investment income, retirement income, tax breaks for family size, childcare, and education.
It also covers the tax credit for retirement savings, deductions for educator expenses, alimony paid, and IRA contributions.
Liberty Tax Online Premium
This is Liberty Tax Online’s top-of-the-line plan. It can accommodate everything available in the Deluxe plan, plus self-employment income and related business deductions, taxable income in excess of $100,000, rental or farming income, partner or shareholder income from schedule K-1, unreported tips, and all other less common income sources, credits and deductions.
Liberty Tax Online is a good choice for any taxpayer, regardless of your tax situation. You can go the do-it-yourself route only as far as you feel able, then enlist the services of one of the company’s thousands of tax professionals.
H&R Block also combines the services of both their online tax preparation software with their extensive network of many thousands of tax professionals.
Similar to Liberty, you can begin working with the software, but engage the services of a local tax professional at any point in the process. The add-on service is referred to as Online Assist. Depending on the plan you select, H&R Block will charge an additional $39.99 to $144.99 for the services of the professional.
H&R Block has four different versions:
H&R Block Free Online
H&R Block’s free version is impressive. You can file your federal tax return for free, and pay $0 per state return filed. If you add Online Assist, the cost will be $39.99, plus $0 per state return. It’s for simple returns, but it can also accommodate the earned income tax credit, childcare expenses, student loan interest, retirement and Social Security income, and the child tax credit. It also comes with technical support by chat.
H&R Block Deluxe Online
This version can accommodate more complicated tax returns, including itemized deductions and health savings accounts. It also offers unlimited tax advice by chat.
The Deluxe plan is available for $29.99 – or $69.99 with Online Assist – plus $36.99 for each state return filed.
H&R Block Premium Online
This version accommodates capital gains and losses, rental property income, and freelance and contractor income with expenses less than $5,000. It also offers unlimited tax advice by chat.
The Premium plan is available for $49.99 – or $109.99 with Online Assist – plus $36.99 per state return filed.
H&R Block Self-Employed
As the name implies, this version is specifically for small businesses, and can accommodate small business expenses, like a home office, depreciation, and vehicle expenses.
You can even import Uber driver tax information, as well as expenses from popular expense tracking apps. The Self-Employed plan is offered at $84.99 – or $144.99 with Online Assist – plus $36.99 per state return filed.
H&R Block is an excellent choice if you want to take a stab at doing your own tax return, but may need assistance from trained professionals. And with more than 12,000 offices nationwide, there’s almost certainly one in your community. For a small additional fee, you can shift over from the online version to in person.
TaxAct is on the lower end of the tax software fee schedule. But it’s also a simpler program, that may not be the best choice for more complicated tax situations. However, TaxAct upped their game last year, by adding their file with Xpert Assist feature, which offers live help from a tax professional while filing your taxes. Much like TurboTax, H&R Block, and Liberty Tax Online, you can also opt to have your return fully completed by a tax professional by adding the Xpert Full Service feature.
Besides that, TaxAct guarantees their software is 100% accurate, and will result in the maximum refund possible. If that turns out to not be true, they will refund the cost of your software, and pay the difference in either your lower refund or higher tax liability, plus any legal costs or penalties, up to $100,000. That’s serious peace of mind!
They also offer their Audit Defense, which will provide a comprehensive response, as well as resolution strategies, including assistance with tax debt relief, the right credits, fraud, and correspondence with both the IRS and state tax agencies.
TaxAct offers four different versions, all of which come with Xpert Help for free, but you can also opt for the Xpert Full Service feature for an additional fee (listed below):
You can file your federal income tax for free, plus $34.95 for each state tax return. It’s available only for simple returns, though it can accommodate dependents, the earned income credit, child tax credits, current students, and retirement income. It also comes with unlimited account support.
Fee with Xpert Full Service: $99.95 + state return included
The Deluxe plan is TaxAct’s most popular plan, and the one that will work best for the largest number of taxpayers. It’s offered at $24.95, plus $44.95 per state return. It’s designed for filers who itemize deductions, and child and dependent care expenses, mortgage interest, real estate taxes, student loan interest, health savings accounts, and adoption credits. It comes with tax specialist phone support.
Fee with Xpert Full Service: $169.95 + $44.95 per state return
The Premier plan is available for $34.95, plus $44.95 per state return. Is designed primarily for taxpayers with investment income. It can accommodate stock transactions, the sale of your home or other major investments, royalty and K-1 income, investment income expenses, rental property income, foreign bank, and financial accounts. This plan level provides prioritized support, including screen sharing.
Fee with Xpert Full Service: $249.95 + $44.95 per state return
TaxAct Self-Employed is available for $64.95, plus $44.95 per state return. As the name implies, it’s designed for self-employed income. That includes freelance and farm income, in addition to business income, as well as personalized business deductions and depreciation calculations. It also offers year-round planning resources
Fee with Xpert Full Service: $279.95 + $44.95 per state return
Other TaxAct features
Like TurboTax, TaxAct Also offers business tax returns, like forms Schedule C, 1065, 1120, and 1120S, for partnerships and corporations. They charge $64.95 for federal, plus $44.95 for state returns for sole proprietorships, and $109.95 for each federal return plus $49.95 per state return for partnerships, and both 1120 and 1120S filings.
Despite the relatively low fees, TaxAct is better for those who have less complicated returns. They offer features and tools comparable with other services, but they’re much lighter when it comes to support services.
E-file.com offers affordable tax preparation at up to 50% less than their competitors, which is the primary attraction of this software. It’s the least expensive tax software on our list.
E-file.com offers three versions:
Free Basic Federal E-File
That’s free for your federal return, plus $22.49 using code 25OFF for state returns. You must earn under $100,000, be under 65, be single or married filing jointly with no dependents, and be a wage earner (W-2 income only). Free Basic also comes with online support, and also accommodates the earned income credit.
Deluxe Plus E-file
This version is available for $20.99 for federal tax returns, plus $22.49 for each state return when using code 25OFF. It allows you to file with dependents, itemized deductions, and include retirement income and higher investment earnings. It also accommodates most deductions and tax credits.
It comes with free premium phone support.
Premium Plus E-file
This version is for more complicated returns, including those that involve both personal and business income. It can accommodate everything available in the Deluxe Plus version, plus taxable income over $100,000, business deductions, and income from self-employment, farming, rental properties, K-1’s, unreported tips, and all less common income types.
It’s $37.49 to prepare and file your federal tax return, and $22.49 for state income tax returns with code 25OFF.
E-file.com may be the least costly tax software available, but it offers fewer services and tools than the competition. One of the major disadvantages of this software is that the free version does not offer phone support. That’s part of how they keep the software cost as low as it is. You complete a support ticket online, and get a response within one business day.
This software is best used by people who have very simple tax situations, some knowledge of tax preparation – or at least access to someone who does – and are looking for the least expensive software available. It’s not well suited for anyone who has a tax situation that’s remotely complex.
Learn more about E-file.com – See details
What is tax preparation software?
Tax preparation software is an online, automated system for preparing individual and business income taxes. It’s used by both tax preparation businesses, like CPAs, and individual taxpayers who prefer to do their own returns.
It eliminates the need for the taxpayer to complete his or her return using actual forms. Instead, the tax preparer or the taxpayer simply inputs the necessary information into the software, which then compiles the tax return.
The software also does all the arithmetic involved, which is what computers do best. This at least eliminates the possibility of arithmetic errors, which might result in notices from the IRS.
Tax software offers a question-and-answer format
The software works on a simple question-and-answer basis. For example, it’ll start by asking you general information, such as your name, address, Social Security number, and dependent information. It will then ask for income information, such as wages, investment income, retirement income, or income from self-employment. From there, you’ll be asked to supply information about certain expenses that might be tax-deductible.
Once you fully input the information, the software is then able to compile your tax return. Since the software is online, it’s regularly updated with the latest tax changes, at both the federal and state levels. That saves the user hours of research.
Once the return has been compiled, the taxpayer can review it for accuracy. But the software will also perform an accuracy check to make sure no information has been overlooked.
Tax software also offers hassle-free filing
With good tax software, your job will be mostly to input your information. The software will do the work of compiling your return, checking for errors, then giving you an opportunity to both store and print your return. You will then be given the option to either print your return and file it by mail, or e-file online.
E-filing is another major plus with tax software. It can cut weeks off the time it takes to receive your refund.
Why should you use tax software?
There are two primary reasons for using tax preparation software…
- Cost. If you have to pay a professional tax preparer, like a CPA, it can easily cost hundreds of dollars, or even thousands if your return is complicated. Most tax software plans can be purchased for less than $100. That’s just a fraction of what you would pay a CPA.
- Speed. A good tax software can enable you to prepare your return in anywhere from a few minutes to a couple of hours, depending on how complicated the return is.
Over the years, tax software has become even faster. For example, most now enable you to import information from the previous year’s tax return. That will save a considerable amount of input time. Many are also able to import data from third-party sources, like employers and investment brokers. You won’t even need to input income information where that’s possible.
Another innovation has been the ability to snap a picture of a document using your mobile device, and downloading it to the tax software. The software will take the information from the picture, without you having to spend time typing the information in.
Tax software vs. tax preparers
Whether you choose to use tax software or a paid tax preparer will depend mostly on the complexity of your tax return and your own understanding of the tax preparation process.
Why would you use a paid tax preparer?
- You have little or no understanding of tax preparation and don’t feel comfortable doing it on your own.
- Your tax situation is very complicated and is better served by using a paid professional.
- You have an ongoing relationship with a professional preparer, particularly a CPA, and tax preparation is part of your service package.
- Your tax situation is the type that may be highly likely to result in an IRS audit. You may prefer having a paid preparer involved in the process at every step to avoid that outcome, or to be prepared (and represented) should it happen.
- You have a lot of money, but not much time, and it makes more sense to pay someone else to prepare your taxes for you.
Read more: Should I Hire A Tax Preparer?
Why would you use tax preparation software?
- Your tax situation is fairly simple and there’s no point paying for the services of a professional.
- You have a solid understanding of your tax situation and feel comfortable preparing your own return.
- You don’t want to spend hundreds or thousands of dollars paying a professional.
- If you normally file your taxes late in the season, you may have difficulty finding a paid preparer. By using tax software, you’re free to file your return anytime you want.
- You like being in charge of your own tax situation, which tax software makes very easy to do.
- You’re expecting a big refund and you want it as soon as possible.
What to look for in a tax software
There are dozens of details with each tax software plan, but here are the most important considerations for most taxpayers:
Cost is typically the first consideration when deciding on tax preparation software. Based on our research, you can find software prices ranging from free up to just over $260 for a premium plan for a very complicated return.
This may be even more important than cost. In other words, will a particular tax software work for your tax situation?
As an example, if you have a very simple tax situation, you may need nothing more than a free service. The main thing you’ll be looking to do is to e-file, and even the free plans offer that ability. But if you’re self-employed and have significant investments, you’ll want to use a more comprehensive plan, specifically designed for those tax situations.
Once again, if your tax situation is simple, this may not be that important. But if you have a complicated return, where the likelihood of being audited or receiving an IRS notice is high, or if you’re likely to have tax situations that will need a professional touch, strong customer support will be very important.
Some tax software, including a couple on our list, offer assistance from tax professionals. That can even include CPAs. These are hybrid plans that offer you all the advantages of tax software, with professional assistance on an as-needed basis.
The comfort factor
Each tax software is a little bit different from the others. Some are very user-friendly, while others are cumbersome and require occasional workarounds.
You may have to try two or more tax software plans before settling on the one you feel most confident about.
Have you used any of these tax software plans, and if so, which would you recommend?