A Less-Taxing Solution
Regarding paid tax preparation options (either online or desktop), TurboTax wins “the most costly” competition hands down. After doing a lot of research, I have to admit that I’m not even sure I understand or have even discovered all the additional fees that can apply in differing situations. There are several not-soeasy-to-spot links on their Web site that will lead you, in a roundabout way, to a page where you can find out what other fees might apply to your situation (for example, it costs $16.95 to efile either a federal or a state return, but it’s not clear when that fee might or might not apply).
TaxCut offers only paid tax prep options; there are no freebies to be had. However, the overall cost of their products and services is still lower than TurboTax, and they have the added value of being backed by live tax experts from H & R Block, the biggest name in tax preparation. You have to figure these people know what they are doing.
With TaxCut (as with TurboTax), the more you pay, the more you get. Their best value is the online version of Premium+State+Efile for $39.95. This package gives you pretty much everything you could need, including the federal program with free efile, state program with free efile (where available), one free session with a real live tax advisor, and it covers just about every tax situation, from a 1040EZ to a Schedule C for self-employment to investment situations. It’s easier to find pricing information for TaxCut than for TurboTax, but there are still little costs here and there that you might not realize youre racking up until you’re all done preparing your return and are ready to efile.
If you have filed taxes before or used tax software before, are pretty capable of understanding written explanations, and want to know all the possible costs involved up front, then TaxAct is the way to go.
Most refreshing is a page on the company’s Web site called “bottomline-pricing”. This page has a chart that tells you exactly what you are going to pay to prepare your taxes under the various packages they offer. Every single price point on this chart is lower than any of the main competition’s.
I confess that after years of using TurboTax, I saw TaxAct advertised and decided to give it a try. I used the free version (and I own a home and I have other deductions and investments as well, so my tax situation is not super-simple) and was completely thrilled that I was getting more money back because I wasn’t paying a high (albeit tax-deductible) price for my tax preparation software.
Years of using other tax software left me fairly familiar with the types of information I was going to need to supply, with my unique tax situations, and with tax preparation in general. I downloaded and installed the desktop version of TaxAct (this was several years ago) and almost enjoyed doing my taxes because I knew I was doing them for free. I felt like giggling all the way to the bank. And if at any time I felt that I needed more than the free version was giving me, I could switch to a paid version “on the go.” I only had to pay when I was ready to file.
In recent years, I have switched to the online version, because I use a Mac a lot more now and TaxAct does not offer a desktop version for the Mac. The Web-based interface of the online software is extremely similar to the desktop version (as are all the online versions of all the software discussed here). And my fears of losing information caused by computer crashes or power failures were allayed when I discovered that whatever I’ve entered is frequently saved and if I want to stop and resume at another time, the online software enables me to start up precisely where I left off. Just as if it were running on my desktop computer.
My final recommendation? If you’re reasonably intelligent, TaxAct more than delivers, and doesn’t gouge a hole in your pocketbook while doing so.
