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Best Tax Software 2020

We've tested some of the most widely used tax-preparation software packages to help you choose the one that's right for you.
July 27, 2020
Income Taxes, Personal Taxes, Taxes
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own.

Taxes are confusing enough without the added stress of figuring out which tax software is the best tax software, so we did the research to help you choose the ideal option to file taxes online. We focused on well-known and widely used tax preparation software, and while their underlying math is the same — the tax code is the tax code — there is a crucial difference between paying for what you could use and paying for stuff you don’t need.

We also looked at several other providers but didn’t include them here, because we felt they didn’t provide a level of service and features worth your time and money when you file taxes online.

Best tax software: Summary of our picks

  • Best for simple returns: H&R Block Free
  • Best for beginning to itemize: H&R Block Deluxe
  • Good for complex returns: TurboTax
  • Good budget picks: TaxSlayer, TaxAct

Best for simple returns: H&R Block Free

What’s a “simple” tax return? Here we define it as one that includes wages and income from a W-2 and limited income from interest or dividends (less than $1,500); claims the standard deduction; and could claim the earned income tax credit or child tax credits.

If that sounds like where you’re at, you may not need a software package built for crazy-complicated tax situations. And when it comes to tax prep software that can do simple returns at a reasonable price without sacrificing user-friendliness, we think H&R Block Free stands out from the crowd.

FREE EDITION

  • $0 (federal) | $0 (state)
  • What H&R Block Free can do: Income from wages (W-2), income from bank interest (1099-INT) and dividends (1099-DIV), student loan interest (1098-E).
  • What H&R Block Free can’t do: Itemized deductions (Schedule A), Deductions and expenses from freelance or self-employed work (Schedule C), HSA distributions (1099-SA).
  • See our H&R Block review.
Start your return on H&R Block's website

Like the free tax software from most of its competitors, H&R Block’s free version lets you file the Form 1040 and take a few common tax breaks if you qualify for them.

But it also lets you file schedules 1, 2 and 3, which is a big bonus because many taxpayers need to file those forms. They allow you to report (but not calculate) things such as business income, alimony, deductible student loan interest, certain retirement contributions, the alternative minimum tax, the credit for dependent care expenses, the Lifetime Learning Credit and the Saver’s Credit.

To boot, H&R Block’s interface is good-looking, straightforward and easy to use, and it steps up to explain concepts as you go. You can skip around if you want, and a banner across the top keeps track of where you stand in the process.

Help is available within the preparation process — many terms during the interview process are hyperlinked with a “learn more” tag so you can get more information without having to wander around. The help menu updates according to where you are in the process.

And if you want to pay for it, H&R Block’s Online Assist gets you unlimited, on-demand chat, phone or screen-sharing sessions with a certified public accountant, enrolled agent or other tax expert at any point.

Here’s a side-by-side look at top providers’ free software packages and what they can do:

Basic tax software packages at a glance


Read full review

TurboTax


Read full review


Read full review



Read full review
Package name:
FREE


Federal return:
$0

State return:
$0
FREE


Federal return:
$0

State return:
$0
FREE


Federal return:
$0

State return:
$0
SIMPLY FREE


Federal return:
$0

State return:
$0
Key forms supported:
  • Form 1040 (two pages).
  • Schedules 1-3.
Form 1040 (two pages).
Form 1040 (two pages).
Form 1040 (two pages) — but only if your taxable income is under $100,000, you file as single or jointly and you claim no dependents.

» MORE: Learn about IRS Free File and other free filing options


Best for beginning to itemize: H&R Block Deluxe

If your tax situation isn’t simple, but it’s not super complex either, choosing tax software can quickly turn stressful. Many people aren’t sure how much horsepower they need, they’re not impressed by features they may not use and they don’t want to overpay.

So when we evaluated each company’s entry-level paid software package for itemizers and studied things such as ease of use, features, help and support options, price and other factors, H&R Block Deluxe was our choice for value, support and modern features.

DELUXE EDITION

  • $49.99 (federal) | $44.99 (state)
  • What H&R Block Deluxe can do: All H&R Block Free can, plus itemized deductions (Schedule A), HSA distributions (1099-SA).
  • What H&R Block Deluxe can’t do: Deductions and expenses from freelance or self-employed work (Schedule C), capital gains and losses (Schedule D), income from rental property (Schedule E).
  • See our H&R Block review.
Start your return on H&R Block's website

This version lets you itemize and claim several popular tax deductions and tax credits, including those for mortgage interest and property taxes, medical expenses and contributions to a health savings account, and charitable donations.

There is a W-2 photo import, which lets you avoid keying in numbers from little boxes while you file taxes online. You can import 1099s, and H&R Block Deluxe will import last year’s return from other tax prep companies.

If you want to pay for it, H&R Block’s “Online Assist” gets you unlimited, on-demand chat, phone or screen-sharing sessions with a CPA, enrolled agent or other tax expert at any point in the process.

Entry-level paid software packages like H&R Block Deluxe don’t handle everything — if you’re an investor, landlord or filing a Schedule C (for freelancers or small-business owners), you’ll need to upgrade — but the question-and-answer process that H&R Block and other providers employ usually points you to the appropriate package.

Companies might offer three or four paid software packages that handle increasingly complex tax situations. Here’s a side-by-side look at those packages from some top providers and what each can do:

Additional tax software packages at a glance


Read full review

TurboTax


Read full review


Read full review



Read full review
If you want to take tax breaks for owning a home or giving to charity
DELUXE


Federal return: $49.99; add $99.99 for Online Assist State return: $44.99; $49.99 for Online Assist
DELUXE


Federal return: $60; $120 with TurboTaxLive

State return: $50; $55 with TurboTax Live
DELUXE+


Federal return: $54.95

State return: $54.95
CLASSIC


Federal return: $17 State return: $39
If you want to take tax breaks for investments or rental property
PREMIUM


Federal return: $69.99; add $139.99 for Online Assist State return: $44.99; $49.99 for Online Assist
PREMIER


Federal return: $90; $170 with TurboTaxLive

State return: $50; $55 with TurboTax Live
PREMIER+


Federal return: $79.95

State return: $54.95
PREMIUM


Federal return: $37

State return: $39

Classic works here too, just with less support.
If you are self-employed
SELF-EMPLOYED


Federal return: $104.99; add $169.99 for Online Assist State return: $44.99; $49.99 for Online Assist
SELF-EMPLOYED


Federal return: $120; $200 with TurboTaxLive

State return: $50; $55 with TurboTax Live
SELF-EMPLOYED+


Federal return: $109.95

State return: $54.95
SELF-EMPLOYED


Federal return: $47

State return: $39

Classic and Premium work here too, just with less support.

If you have a complex return, try TurboTax

If you have a lot of investments to track, are a landlord who gets income from rent or are a freelancer or self-employed, you’ve probably got a lot of extra tax forms to fill out and a lot of extra tax rules to follow. For those situations, TurboTax has two good solutions: TurboTax Premier and TurboTax Self-Employed.

  • TurboTax is generally pricier than everything else out there, but while confident filers may not need all the bells and whistles its software offers, many people — especially with complex tax situations — will find the experience worth a few extra bucks.
  • Prices: Packages run from $60 to $120; with TurboTax Live, it’s between $120 and $200. Filing a state return adds $50, or $55 with Live.
  • See our TurboTax review.
Start your return on TurboTax's website

TurboTax Premier helps you calculate investment and rental income because it supports schedules D, E and K-1. TurboTax Self-Employed gets you everything in the Premier version plus support for the home office deduction, extra deduction help and special features for freelancers, independent contractors and side-hustlers. It also comes with a one-year subscription to QuickBooks Self-Employed and boasts a neat expense-tracking feature through QuickBooks, including the ability to store photos of your receipts and track mileage from your phone.

One of TurboTax’s coolest support features is TurboTax Live. It offers a one-on-one review with a CPA or enrolled agent before you file, as well as unlimited live tax advice. They’ll even sign and e-file your tax return if you want. You can make an appointment or talk on the fly to a tax pro via one-way video (you see them, but they don’t see you — they just see your screen). To boot, you can get tax advice year-round with TurboTax Live. This is especially valuable for self-employed filers who often need help with tricky tax situations, complex questions and year-round issues, so having quick and easy access to a tax pro puts this package over the top.

You can import W-2 information by taking a photo, and you can import 1099s. The Premier and Self-Employed packages also integrate ItsDeductible, a feature — and standalone mobile app — that’s helpful for quickly finding the deduction value of donated clothes, household items or other objects.

But here’s the thing: TurboTax is expensive. The list price of its software routinely sits on the high end of the spectrum, especially when you factor in the added cost of a state return. And if you want access to human help when you file taxes online, it costs even more.


If you want the budget picks to file taxes online…

Tax preparation can be really expensive. If you have a budget to stick to, there are solid options out there this year from two providers.

For confident filers: TaxSlayer

If you’re comfortable doing your own taxes and don’t want to pay for a bunch of hand-holding or shiny features, you can save a lot of money with TaxSlayer.

  • TaxSlayer is again one of the best deals on the market. Its interface isn’t far off those offered by providers charging twice the price, but we think confident tax filers will fare the best.
  • Prices: Packages run from $17 to $47. Filing a state return adds $39.
  • See our TaxSlayer review.
Start your return on TaxSlayer's website

Unlike most competitors, TaxSlayer ties its prices to the level of support, not to what the software package can do. That means the company’s cheapest paid package handles tax forms and situations — itemizing, investments, rental income, self-employment returns — that its most expensive package does. It just offers less support.

If you don’t have a lot of questions about what you’re doing, you probably won’t mind that there aren’t as many full-blown, on-screen concept explanations as other competitors might provide.

Though phone and email tech support are free, the more valuable kind of help — tax help — is free only as part of the Premium and Self-Employed packages. The service is called Ask a Tax Pro, and users submit their questions through their TaxSlayer accounts. The tax pro contacts them within one business day via phone or email. (Self-Employed package users get access to tax pros who specialize in self-employment.) It’s not as face-to-face as other providers offer.

OK, hold my hand a little: TaxAct

TaxAct’s products may not be as flashy as those from H&R Block and TurboTax, but their prices are better, and for some, function outweighs form.

  • TaxAct has been working overtime to compete against the bigger players, and this year’s suite of tax prep packages proves TaxAct is indeed a contender.
  • Prices: Packages run from $54.95 to $109.95. Filing a state return can add $54.95.
  • See our TaxAct review.
Start your return on TaxAct's website

TaxAct offers most of your standard options, such as importing last year’s returns, a W-2 import and a donation assistant (for the paid packages), as well as some planning tools and calculators. You can import 1099s. The self-employed package will help look for tax breaks specific to your line of work.

Like many other tax packages, help is available throughout the preparation process, but other competitors have more robust in-line help. TaxAct offers tax support (not advice) via phone and in-app email for paid users. It also offers an interesting screen-share option for its Premier+ and Self-Employed+ users: It’s not a face-to-face video connection; rather, it simply lets the user and the support agent see each other’s screens, including cursor moves and clicks. (The company says the support agent can’t see entry fields containing password or payment information.)

The tax pro you get may not be a CPA. TaxAct says its tax specialists are people who have prepared taxes before, have taken and completed tax classes or have taken a company tax certification course; they all also received 80 to 100 hours of in-house training, according to the company. They are supervised by an enrolled agent.

» Expecting a tax refund? Here are the best online brokers for beginners


To recap, here is a list of our picks by category:

Best Tax Software

  • Best for simple returns: H&R Block Free
  • Best for beginning to itemize: H&R Block Deluxe
  • Good for complex returns: TurboTax
  • Good budget picks: TaxSlayer, TaxAct

More tips for choosing how to file taxes online

1. SEE IF YOU CAN USE A SOFTWARE PROVIDER’S FREE VERSION

  • Virtually all large tax software providers offer free versions of their software if you want to file taxes online, but they’re usually only for people with really simple tax returns.
  • Note that state returns sometimes aren’t free (especially as the filing deadline nears).

2. SEE IF YOU QUALIFY FOR FREE FILING THROUGH THE IRS

  • The IRS’ Free File program could get you name-brand software from among 10 tax-prep companies if your adjusted gross income was below $69,000 in 2019.
  • If your income exceeds that threshold, you can get access only to fillable electronic versions of the IRS forms and not much guidance.

3. do your homework on audit protection

Audits are unlikely, but if you think you’re at risk of an audit and want to purchase protection, you should understand what your software provides when you file taxes online.

In general, there are two levels of service:

  • Guidance (which basically means helping you understand what’s happening).
  • Representation (which means a skilled human will speak with the IRS on your behalf).

Most providers offer free guidance, but you’ll likely have to pay for representation.

Here’s a brief summary of what each provider offers:

  • H&R Block offers free audit support, but users can purchase a product called Worry-Free Audit Support. This gets you in contact with an enrolled agent to guide you through an audit. It includes IRS correspondence management, audit preparation and in-person audit representation. That runs $19.99. On top of that, you can buy something called Tax Identity Shield, which helps you apply for an Identity Protection PIN or Identity Theft Indicator if it turns out criminals have used your personal info to file a fake tax return. That runs $14.99. (If you buy both features together, you’ll pay $24.99, which saves $10.)
  • TurboTax gives everyone free audit support from a tax pro to help them understand what’s going on if they get that dreaded letter. But if you want someone to represent you in front of the IRS, you’ll need TurboTax’s audit defense product, called Max Defend and Restore. It runs $45 to $60 and includes things such as identity theft monitoring, loss insurance and restoration help.
  • TaxAct’s audit assistance consists of a FAQ page on its website. But customers can buy audit defense from a partner company called Protection Plus for $49.95. Coverage includes three years of audit services for this year’s return, and TaxAct says the product will guide you through the audit process, handle IRS and state correspondence on your behalf, help with denied tax credits as well as tax debt, and provide tax fraud assistance.
  • TaxSlayer’s Premium and Self-Employed packages come with free audit assistance (users of other versions can buy it for $29), which helps you prepare for an audit but won’t represent you in front of the IRS. The coverage applies for three years from the date you buy the software. Users can also buy SecurelyID, an identity protection package. It comes bundled with an Audit Defense product for $44.

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