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FreeTaxUSA Vs. TurboTax

Tax filing software is increasingly popular among taxpayers who seek to simplify the tax filing process.

Two of the most popular software programs are FreeTaxUSA and TurboTax.

This article will compare the features, prices, and limitations of both programs in order to help taxpayers decide which program is most suitable for their needs.

Key Takeaways

  • FreeTaxUSA offers a free federal filing option for individuals with simple tax situations, making it a cost-effective choice.
  • TurboTax provides a user-friendly interface and offers free filing options for simple tax returns, allowing for easy and efficient tax filing.
  • FreeTaxUSA has limited customer support through email and no audit support, which may require users to handle issues on their own.
  • TurboTax offers tools and guidance to maximize deductions and credits, as well as audit defense services for accuracy, providing added peace of mind.

FreeTaxUSA

FreeTaxUSA is a free federal filing option for individuals with simple tax situations. It offers support for a wide range of tax situations with an easy-to-use interface and accurate calculations.

The service is designed to be user-friendly, providing clear instructions to guide users through their filing process. It also supports a variety of tax situations, such as self-employment, rental income, and investment income.

The calculations are updated with the latest tax laws and regulations to ensure accuracy. Additionally, users can access prior year returns for up to 10 years.

Customers can also benefit from the free support resources available, including chat, email, and online guides.

Overall, FreeTaxUSA provides a convenient and cost-effective filing option for individuals with simple tax situations.

Price of FreeTaxUSA

The Deluxe edition of FreeTaxUSA is offered for $6.99, which includes additional support for deductions, credits, and priority customer support. For individuals with a simple tax situation, FreeTaxUSA also offers a free federal filing option.

On top of the federal filing fee, a $14.99 fee is charged for each state tax return filed by the user, which includes a free printed copy of the tax return. Amended federal tax returns will also incur a fee of $14.99.

Overall, FreeTaxUSA provides affordable pricing options for tax preparation, ranging from the free option to the low-cost Deluxe edition for more complex situations. Thus, it is a viable alternative to other more expensive options such as TurboTax.

The benefits of FreeTaxUSA include:

  1. Free federal filing option for individuals with simple tax situations
  2. Low-cost Deluxe edition for more complex tax situations
  3. $14.99 fee for state and amended federal tax returns
  4. Free printed copy of the tax return included in the state filing fee.

Key Limitation of FreeTaxUSA

Despite its advantages, FreeTaxUSA also has several key limitations.

Firstly, customer support is limited to email, which can be frustrating for users who prefer more immediate assistance. Additionally, FreeTaxUSA does not provide audit support, meaning users must handle issues themselves in the event of an audit.

Secondly, the software has limited import options, requiring users to manually enter data from other sources. This can be time-consuming and prone to errors.

Thirdly, while FreeTaxUSA does offer a mobile app, its functionality is limited compared to the desktop version. Users may not have access to all the features they need when filing their taxes on the go.

Lastly, FreeTaxUSA does not have automatic error-checking. This means users must review their tax returns themselves to ensure accuracy and identify any mistakes.

Competitor

Competing tax software companies offer varying features and import options at different price points. FreeTaxUSA and TurboTax are two of the most popular tax preparation software companies, each featuring unique benefits. H&R Block is another strong competitor, offering online and in-person services with over 60 years of experience. TaxAct is known for its affordability and providing both software and in-person tax preparation services. Other contenders in the space include Jackson Hewitt, TaxSlayer, Credit Karma Tax, and eSmart Tax.

These companies offer different levels of features and import options at various price points. TurboTax is generally more expensive than FreeTaxUSA, but it offers more robust features and options that may be attractive to taxpayers seeking additional benefits. H&R Block provides a range of services, including in-person assistance, which may be beneficial for those who need help from a tax professional. TaxAct is the most affordable option, providing essential features and options at lower prices.

Feature of TurboTax

TurboTax offers a variety of features and options that may be attractive to taxpayers seeking benefits beyond what is available with other tax preparation software.

It features a user-friendly interface to make filing taxes easy for users. It also provides free filing options for simple tax returns.

Additionally, data can be imported from multiple sources, which saves time and effort. Furthermore, the software comes with tools and guidance to maximize deductions and credits.

Moreover, it offers audit defense services to ensure accuracy. Finally, TurboTax has a mobile app, so users can file taxes on the go.

Price of TurboTax

The price of TurboTax varies, with different editions available at different prices for federal and state filing.

For individuals with simple tax returns, the Free Edition is available for free for federal and state taxes.

The Deluxe Edition is priced at $60 for federal filing and $50 per state return, and is designed for individuals with more complex tax situations.

The Premier Edition is ideal for individuals with investments or rental property income, and is priced at $90 for federal filing and $50 per state return.

For self-employed individuals or those with small business income, the Self-Employed Edition offers additional features for expense and mileage deduction tracking, priced at $120 for federal filing and $50 per state return.

Additionally, TurboTax Live is available with all editions as an additional cost starting at $50 for a federal expert review.

The pricing of TurboTax can be summarized as follows:

  • Free Edition: free for federal and state taxes
  • Deluxe Edition: $60 for federal filing and $50 per state return
  • Premier Edition: $90 for federal filing and $50 per state return
  • Self-Employed Edition: $120 for federal filing and $50 per state return
  • TurboTax Live: additional cost starting at $50 for a federal expert review.

Key Limitation Of TurboTax

Moving on from the price of TurboTax, the key limitations of the tax preparation software are also important to consider.

TurboTax may be more expensive than other options, but the navigation may be complicated for those unfamiliar with tax terminology and the support options may be inadequate for some users.

Additionally, the import options may be limited, requiring manual data entry and increasing the potential for user errors.

Furthermore, users may need more customization options to tailor their tax return according to their needs or preferences.

Despite its popularity, TurboTax may not be the right fit for everyone, and users should take these factors into account before making a decision.

TurboTax’s Biggest Competitor

H&R Block is one of the biggest competitors to TurboTax in the tax preparation software market. It offers online and in-person tax preparation services and is known for providing an alternative to the more expensive TurboTax.

Other competitors to TurboTax include:

  1. TaxAct, which offers in-person tax preparation services at certain locations and is known for its lower cost compared to TurboTax.
  2. Jackson Hewitt, which offers tax preparation software and in-person services.
  3. TaxSlayer, which is an online tax preparation service.
  4. Credit Karma Tax, which is a free tax preparation service.

Each of these competitors has different features and benefits, but they all provide an alternative to TurboTax. Consumers need to compare the features and costs of each before making a decision.

Conclusion

When choosing a tax filing platform, it is important to consider the features offered, the price point, and any limitations.

FreeTaxUSA offers a free filing option, but with limited features and a more complicated filing process.

TurboTax, while more expensive, offers a more user-friendly experience with a variety of features and a step-by-step guide.

With its biggest competitor being H&R Block, TurboTax is an ideal choice for those who are comfortable paying a higher price point for a more comprehensive tax filing experience.