Ben Todd | Apr 16, 2017 | 3
The Best Tax Preparation Software Online And Offline Right Now
We start with a short introduction on picking the best tax software for you.
The article then moves on to pro and con reviews of Tax Act, Jackson Hewitt, H&R Block and Tax Slayer. In addition and as usual, this article is loaded with high quality and free advice.
With our free help, you will find out all you need to know in order to pick the best tax preparation software and service for you.
Do you want desktop software, online software, Smartphone software or a combination of all three types of tax preparation software?
There is software that you may use online where you access your accounts via a web browser and connect with your online tax software. Sometimes, it is hosted on a series of servers via an online accounting service, and sometimes it is done with cloud storage and cloud computing. Desktop software is more common where you have to install the program on your computer.
There is also mobile software that usually does some of the work for you, and less common apps that take you through the entire tax preparation process. Some services have mobile and desktop software for you to try. When using online or local software, remember to print out hard copies and to save a PDF copy locally too. The PDF versions are especially helpful when you are completing future tax returns.
Is there software to help you dig out your tax deductions?
There are online websites that have a deductions feature, and there are programs that may help you figure out your tax deductions. The best ones operate by asking you a series of questions that eventually lead to a conclusion about the deductions you are owed.
How much support does the tax software offer?
Sadly, this is a tough one to find out. Usually, the only way to find out is to go online and look at user reviews for people who said they asked lots of questions and got answers. If they put you in touch with a tax professional or expert, then all the better, and it is even better if they do it for free or as part of the service without charging you extra.
Does your tax software charge for e-filing?
The government prefers that you file online and that you do not print out your return and post it. The problem is that many tax preparation software companies will charge you an extra fee for filing online, so be careful and find out if their free or cheap software is not hiding the fact that they are charging a big fee for e-filing.
Do you need software for a state tax return?
There are different types of software that deal more specifically with state software. It becomes tricky if you moved from one state to another because you need two state tax returns.
Should you pick a program with Basic, Deluxe or Premium Features?
This sort of thing really hacks me off. They are companies offer something less than everything when offering more is stupidly easy. If I am paying any amount, then I want something that does the whole job and has every feature. I am not paying with ripped dollar bills, so why are they offering me something less than the whole. Look for software that gives you everything you need. Remember that you can complete your notes with a Microsoft notepad alone. You do not need extra features and deluxe functions.
Is your device compatible with the software?
One of the great things about free trials is that they allow you to test to see if your computer is compatible with the software you are planning to use. The software you pick will have a list of minimum requirements. Check to see if your computer has what it takes to use the software.
Can you use File Free?
You may be able to do your federal taxes for free . If you have an income of $62,000 or less, you may use Free File software. If your income is above $62.000, then you may use their Free File Fillable forms.
There are other software and filing options available from the IRS. They usually involve the use of third-party software suppliers that allow users some form of free use if they qualify.
Use new software every year
If you use a subscription service, then there is a chance they will update your software each year. If they do not use a subscription service, then you may need to buy the software every year. Online merchants sell or offer outdated tax preparation software, which is fine, but be aware that it may be out of date.
[+] You may use the tax preparation software and file your form 1040 EZ form for free.
[+] Their prices are reasonable.
[+] Their premium service gives you human answers to your problems and it runs for three years after the date of purchase.
[+] It is not as simple or as good as Turbo Tax, but it is far cheaper and Turbo Tax is far too expensive for my taste.
[+] The military edition is very good from what the online reviews say about it, but I couldn’t test the military one myself for obvious reasons.
[–] The premium service is probably the one you should go for because their knowledge base is simply not good enough to guide you through the process with their free or middle-ground service.
[–] their software is not overly difficult, even for tax software, but many of the services on this article are more simple and easy to use.
[–] Their security is not perfect and they have been breached in the past. Will it happen again? Have they learned their lesson?
[–] Is somebody at the company selling off information and email addresses? Even I received spam from the email address I set up to join with.
[–] Click the audit support button by accident, and you will have to pay for it.
[–] There is no Tax Slayer app, which isn’t a devastating flaw, but is a little odd in this day and age.
Our advice on Tax Slayer – Take it if you will
Journalistic integrity forces me to include Tax Slayer in this article and to give it the good review it deserves, but I mentioned in the introduction that I do not like services that offer a bit free and then ask you to pay the rest. I do not like that their tax preparation software offers free services for your 1040 EZ form only and has you pay for the more advanced (and other forms) services. Nevertheless, I should point out that being able to file on form for free is better than not being able to file any for free.
The premium service only adds live chat, which seems like a bit of a rip, but you will not get a human answer to your problems without it. If you have had tax problems in the past, then this is not the company for you, (even with their live chat). If you have always experienced smooth sailing through calm seas, then consider using this service. Despite their nasty free-but-not trick, they do offer very good prices for intermediate bookkeepers and tax return filers.
[+] You may file all four versions of the 1040 with their free version of this software
[+] They have tax advisors you can pay if you mess up your return
[+] They have an audit support team that is one of the best on the market
[+] The company has many services that you may get for free, and some that you have to pay for
[+] The company gives an interest-free loan on your refund as a refund advance
[+] You may file online and pay nothing
[+] You may file your 1040EZ in their office for free
[+] They have quite a few offices littered around the USA
[+] They have tax-calculating tools, refund options, payment options and a slew of filing options and products
[+] Despite the problems they have caused people, even people with negative reviews say they had a great experience with the company for decades before they experienced a problem.
[–] Some of the software is rather expensive. They are not offering a tiered system, they are simply charging from some tools while giving you functions (such as e-filing) for free. Other companies may give the tools free and then charge for e-filing.
[–] Searching the website is information is tricky because there is so much content on their website. There are well over 200 pages on the website.
[–] If you pay them to do the work for you, and they mess it up, they expect you to pay them to put it right.
[–] The Emerald Advance line of credit has its fair share of fees that are very high and often unexpected if you do not read the small print.
[–] If H&R Block mess it up, you cannot blame them. Uncle Sam still considers you responsible for getting your tax return right.
[–] The people at H&R Block are not accountants, they are not equipped to deal with any problems or anything out of the ordinary, and they cannot be held responsible for their mistakes.
Our advice on H&R Block – Take it if you will
If you are powering ahead with your own tax returns and you are happy with your own efforts, then use their free tools and their cheap tools to help you. If you consider yourself a bit of a tax-illiterate or you feel like you need more than the help of a little software, then avoid this company. Their staff members are not accountants, only the paid advisors are, and even they are not held responsible if it is all messed up.
Beware of their offers of credit because their credit offers give them an incentive to engineer a tax refund that is bigger than the one you should get, and remember that you cannot hold them responsible for saying that it is because Uncle Sam will accept H&R Block’s reason that it was a simple human error. You cannot hold H&R Block accountable and you will have to fix their return errors at your own cost.
[+] It used to be one of the cheapest paid tax preparation solutions, but prices have risen. Nevertheless, it costs much less than most of its larger competitors.
[+] They offer identity recovery services if you are part of a criminal scam where your identify was stolen and/or tax returns for filed in your name by criminals.
[+] I personally found that reviewing your work is easier with Tax Act than many of the others I have reviewed.
[+] The security features are impressive and it seems that they have invested money into security in a big way.
[+] They have a price lock feature that means that your fees will not increase from the time you start using the software to the time you file.
[+] The program has a nice interface that I found very easy to understand and self-explanatory for intermediate tax filers. Novices may still find the program mystifying.
[–] Retracing your steps to add information that you have forgotten is quite a slog and overly difficult, albeit not mind melting.
[–] Tax Act is not for the uninitiated. There is very little hand holding, you are left to your own devices.
[–] The website and/or service occasionally has server problems during peak periods. Consider yourself warned.
[–] You cannot hold them accountable with the IRS if they help you make a mess, but you may be able to sue them in some circumstances because they guarantee a max refund and 100% accuracy.
[–] They will debit fees from your account even if you stop filing half way through.
[–] Their prices could stand to be a little more transparent. You may have a nasty surprise or two at the checkout.
[–] It logs you out after a few minutes of inactivity, which is a nice security feature, but I found it annoying. It is not as if I was reviewing the program in a busy bus station full of people trying to steal my identity and tax information, I was in a secure office where the only unwanted intruder is an eCheck intern with a Monty Python obsession.
Our advice on Tax Act – Take it if you will
In the section on how to choose tax preparation software, I said you should despise companies that have a tiered system. This one has something similar because they have a free, a plus and a premium service. However, they are simply the terms to use to describe the different use services they have. Their free version is for regular taxpayers, premium is for freelancers and contractors. The Plus version is for homeowners and investors. It is not the same con that freemium games pull where they give you a bit and make you pay for the rest, the three plans they have are for three different types of people.
I have read about prison convicts filing tax returns for ordinary citizens and somehow claiming their refunds, and I like the fact that TaxAct helps you recover your identity if this happens. The scam was even featured on the TV show “Lockup.”
If you are new to doing your taxes, especially if your situation has changed where you have just become an investor, employed, unemployed, self-employed, or other, then I do not recommend using this software. If you are an intermediate bookkeeper and tax returner, then this low-cost tax return solution is definitely for you. The company will not hold your hand, and I don’t think their advisors are very good for newbie tax filers. File earlier (don’t leave it too late) to avoid issues, especially technology-related issues.
[+] It has branches littered around the USA, which means you can walk in and get personal help if you need it.
[+] The website, software and service has a knowledge base.
[+] You may use their email support and live chat support for free, but do not expect too much tax return help, it is mostly for issues around using the software.
[+] They have over 3000 locations based in WalMarts, which is very convenient. Their total number of branches is more than 6300.
[+] Maximum refund given or your money back. It is a nice offer, but a little redundant if you think about it because are you really going to do your taxes twice to check if their refund was the biggest?
[+] The mobile apps, the online tools and the web browser online filing system is very convenient and uncomplicated (within reason, you are filing tricky tax returns after all).
[+] I personally like the way that their Android and iPhone apps are laid out and how the big-button pressing system (that most apps have to support touch screens) actually makes the app easier to navigate and use.
[+] The Jackson Hewitt tax tips make good reading for anybody, even if you are not 100% interested in doing your own accounts in the future. It’s not exactly Charles Dickens, but I found it mildly interesting.
[–] Only premium users get phone support, and many people have complained that the phone support staff are awful.
[–] Some of their customer service staff will not give you their names, which is indicative of not giving a shit about their level of customer service satisfaction.
[–] When there are delays, the staff treat your potentially life changing issues as if they are a minor childish irritation.
[–] Their small print hides the true cost of their service. The more you need them from them, the more sneaky charges you will accrue.
[–] Do more of your return yourself with their cheap tools because the more services you use, the more likely the cost will go over $500.
[–] The instant tax refund is not a loss leader, they may offer a $750+ refund, but your fees will come to over $400 in many cases.
Our advice on Jackson Hewitt – Take it if you will
I don’t suggest using their services if you are looking to get an advance from them on your refund because there are quite a few complaints online that seem to refer to their lines of credit. Also, do not leave it too late to file your returns because some people have complained that Jackson Hewitt staff took their time and missed the deadline.
I cannot honestly say I had a bad experience testing this company and/or using its tax preparation software. Most of the complaints I have found online are complaining about their tax preparation services where you leave it to their staff rather than do it yourself. If you are adept at doing your taxes and you simply want to use their tools and software, then use this company. If you are going to rely on their staff to do your return, then look online at their most recent reviews.
Also, I did a fair amount of research into what other professional reviewers were saying, and it is clear that I was the only one to test their software and even their website. Some said the tools were basic (they are not) and that the website is straightforward, which it isn’t because it is 90% marketing.
Conclusion one – Which of these tax preparation software services do I use?
I cannot speak for the rest of the team, but I personally do not use any of them. I reviewed all of them in depth, and I did a lot of research into what other people thought because I know my personal experience may differ from what other people experience. I am not here to sell any of them to you; I am simply explaining my own experience with them.
I reviewed them, but I do not use them. I do my own tax returns and book keeping with Microsoft Excel and Microsoft Word documents. When I was in hospital as a 19yr old, I read books on accounting and bookkeeping until I had learned as much as I needed. It led to me getting a junior accountant job for a full three months, which was officially the most boring job I have ever had, and it is the only job I have ever been fired from. I used to spend my time playing MineSweeper. They deleted it from my computer, so I navigated through their network and replaced the files from the Spanish-speaking lady’s computer across from me. I was fired for wasting time and for telling staff from other departments what their co-workers were earning (which is a big no no).
The image below shows my accountancy file. I use Word and Excel files to keep my records and I use what I have recorded to fill out my tax returns. I have only been audited once after I bought my first property. I had done a reasonably good job, but I spent a lot of money on tax consultants to help me get through without too much heartache.
– December 2016 update – stop writing in about how the excel file names are blurred. I am not giving out personal details (even boring account ones) to the World Wide Web. I kept them blurry on purpose.
Conclusion two – My advice if you want it
If I were to give advice, it is this. Find yourself an accountant that you can trust and that you can hold responsible if things go wrong, and develop a good relationship with that accountant. Learn how to keep your own books so that your accountancy fees and filing fees are significantly lower.
I knew a plasterer in 1996 who went self-employed. He kept a record of all his income rather well, but he kept track of his outgoings by keeping/printing out receipts and storing them in a bin liner. His first visit to an accountant’s office cost him $800 just for sorting his bookkeeping. The accountant’s office that I referred the plasterer to told me they had their newest employee sit in their conference room and spend days going through his bags of receipts and logging each one. The plasterer didn’t make that mistake again.
I wouldn’t recommend doing it my way by doing your own bookkeeping without software and your tax returns without the help of software or an accountant. If you do go my route, then learn accountancy and bookkeeping in your own time, you do not need a diploma or degree in it to do your own accounts. Also, keep things very simple and separate. Every business venture, source of income and so forth should have its own excel sheet. Write notes on Word documents, and always check last years returns to make sure you do not file inconsistent returns, such as claiming you started a business in June on one return, and then saying you started in July on your next return.
Use your Word documents to keep notes of financial irregularities. Such as how my girlfriend puts money into one of my business accounts so she can use my PayPal account to give her money to the Born Free foundation. I have to keep track of it separately so I can explain (if needed) that it isn’t extra income.
End Note – The absence of Turbo Tax
Turbo Tax is a big company, it is reasonably well reviewed, and they will help you if you are audited. I didn’t review them because they are too expensive and I am not charging the eCheck company to test a service that I consider too expensive. Nobody on our team pays the sort of fees that Turbo Tax charges, and I will not recommend that you pay their high fees either.