A Comparison Of Online Income Tax Preparation Services
W-2 forms and other tax documents have been showing up in your mailbox since January and April 15 will be here before you know it, but there’s still plenty of time to do your taxes, especially if you plan to do them online.
There have been internet-based versions of tax prep services for years, but they have never been more popular than they are now. But don’t mistake popular with enjoyable. We are talking about taxes, after all. However, these services can save you a lot of time and aggravation.
The best and most popular services let users save partially finished returns and finish them over multiple sessions. They are convenient, and they remember your data from year to year, saving your information on the tax-prep site and giving you a head start on the process after you input data the first time.
After you choose a tax-prep package, you'll need to decide which version you want to use. Your choices range from the 1040EZ to the more expensive premium versions. Keep in mind that even if you’re doing your business’ taxes, you may not need a premium version. It’s also important to note that all of the best online packages are relatively inexpensive, at least compared to the cost of hiring a tax preparer.
The following reviews, presented in alphabetical order, are from tax expert Kathy Yakal. The prices listed here are retail prices, but Amazon and other e-retailers often offer better prices.
CompleteTax has some of the best guidance available on tax preparation sites. It also does a good job of exploring tax topics.
- CCH is a great parent company
- It offers users help in all facets
- It’s thorough and comprehensive
- The interface looks old
- The review process leaves a lot to be desired
- The customer service is expensive
- Self-employed customers must buy the premium product
Bottom Line: CompleteTax is good, but it would be a lot better if it improved its user interface and offered better integrated guidance.
H&R Block At Home Premium
H&R Block At Home Premium Online competes well with TurboTax and its other competitors, and its Best of Both option is particularly impressive, providing great support at a great price. (For discounts on H&R Block tax preparation, check out theseH&R Block Coupons.)
- It provides excellent advice from two trusted sources: H&R Block and The Tax Institute
- The user interface is simple and fast. What more do you want?
- It provides targeted help
- Users need to be aware that its final review doesn't always work correctly
- Its help is not as comprehensive and thorough as some of its rivals
- It isn’t cheap
Bottom Line: H&R Block At Home Premium makes it easy to complete your 1040 and the accompanying forms and schedules, and its user interface and targeted help is impressive, but its post-prep review is lacking.
TaxSlayer.com Premium Edition
TaxSlayer.com's Premium Edition offers free live tax advice, priority support, prior year comparisons and tax audit assistance, and you only pay if you’re completely satisfied.
- Users like it’s simple, attractive interface
- It’s good at catching errors in process
- It has a Spanish version
- It is inexpensive
- It doesn't provide much guidance
- It provides few hyperlinked help files than its competitors
- It doesn't always do a good job of documenting entries
- It needs a navigational list
- The return review forces users to find a related page manually
Bottom Line: TaxSlayer.com Premium does a lot of things right. It offers a well-designed interface and good support for forms and schedules. But it doesn't provide the guidance needed for such a complex operation, and other attributes, like the return review, don't compete well with other services.
Price: $19.95 for federal and $7.95 for state.
TaxACT Online Ultimate Bundle
TaxACT is a great buy for the 2011 tax filing year. It supports all IRS forms, including and especially the 1040 form, and it offers unlimited professional help for only $7.95 extra.
- It is a great deal
- It’s fast
- It provides thorough guidance throughout
- It offers an excellent free version
- It provides a well-reasoned walk-through of tax return
- There is no prepaid audit help
- It depends on IRS instructions, which are not always clear
Bottom Line: TaxACT’s free version supports the same set of IRS forms and schedules as its inexpensive paid edition, but it is incomplete.
TurboTax Premier Online Edition
TurboTax has stiff competition, and it is expensive, but it does everything right and users love its combination of financial topics, guidance, navigational tools and interface excellence. (For discounts on TurboTax tax preparation, check out theseTurboTax Coupons.)
- Updated mobile offerings
- Free phone support and online chat with tax professionals
- It is fast
- Its user interface and navigational system is impressive
- It costs more than all of its competitors
Bottom line: TurboTax has at least a slight edge over its toughest competitors and is the product that its competitors are working to beat.
Keeps these pros and cons in mind the next time you are on the market for an online tax preparer. They will help you to make the best decision on your tax preparation.