There are plenty of better things to do than fill out tax forms for hours, which is why there’s a huge market for tax-prep software. In fact, at least one-third of taxpayers filed from home using a variety of software products during the 2015 tax season, according to the U.S. Treasury. Three options — TurboTax, TaxAct and H&R Block — get a lot of that action, but how do they compare?
We’ve taken a look — but first, two notes. First, although the prices listed here are accurate at time of publication, some tax programs’ prices fluctuate during the tax-filing season. You should always verify costs before purchasing.
Second, you’ll need to decide whether you want to buy the desktop version or the online version. Typically, online versions are more convenient because there’s nothing to install and you can access your return from multiple devices, but desktop versions tend to offer more control by housing your data locally. Each has its pros and cons, and each has its own price structures.
If you want the convenience of filing online but the security of using a company with a local presence, H&R Block’s software offerings are worth considering.
The free and the unfree
The free version of H&R Block’s software allows you to file a Form 1040EZ, 1040A or 1040 and even do some itemizing, which is great if you donated to charity or paid mortgage interest, for example. The free version also lets you import information from your W-2. And if you’ve been using TaxAct or TurboTax and want to switch, you should be able to import your files right into H&R Block’s software.
Remember, however, that if your state assesses income taxes, you’ll need to file a return there, too — and that’s not free if you want to submit it electronically. H&R Block charges $29.99 per state to e-file if you’re using the free online software, and that price could change depending on the time of year.
If you want to import last year’s data, try H&R Block’s Basic version, which costs $39.99 for the online version and $29.95 for the desktop version. You’ll also be able to store your files for six years.
But if your tax situation is a little more complex (you’re an investor, self-employed or own rental property, for example), you’ll likely need to upgrade to H&R Block’s Deluxe or Premium versions, which run from $54.95 to $74.99 depending on whether you buy the online or desktop versions. Again, the prices for the online versions don’t include the cost to file a state return.
The free version doesn’t get you free help at any of the 11,000+ brick-and-mortar H&R Block offices — but it does get you unlimited live chat with H&R Block tax professionals. If the worst happens and you’re audited, all of H&R Block’s choices also include free, in-person representation.
If you’re nervous about making a mistake or leaving refund money on the table, H&R Block offers a “Best of Both” program that combines the Premium product with a personal review from an H&R Block tax professional who will e-file your return for you. That runs $99.99, plus $39.99 for a state return.
You can get your refund via check, direct deposit, prepaid debit card or gift card. You can also use part of it to pay for your tax prep fees — but it’ll cost you an additional $34.95 if you use your federal tax refund or $13 if you use your state refund.
With the prepaid debit card, ATM withdrawals will cost $3 each. And if you don’t use the card for two months, a $4.95 per month inactivity fee kicks in. Alternatively, those using the desktop version can get a 5% or 10% bonus on gift cards, which come in $100 increments (the gift card option for online users has expired). Merchants include Amazon and Target.
Compared with its competitors, TaxAct is a more cost-conscious choice.
Like H&R Block and TurboTax, the free version is best for people who have uncomplicated tax situations: They worked for wages and got W-2s, for example, or didn’t make many investment purchases or sales, didn’t run a business on the side, and either don’t itemize or have only simple deductions. Unlike H&R Block, the online free version also comes with a free state filing through April 18. But beware: The desktop version doesn’t — state filing costs $14.99.
If you need to import data from prior years or want unlimited phone support, start with the Basic version, which is $14.99 for online or $19.99 for desktop. If you choose the online version, you’ll also need to pay $14.99 to file your state return, but the combined $29.98 is still less than similar offerings from H&R Block and TurboTax.
If you need to file a Form 1040 (versus a simpler 1040EZ or 1040A, which is all the free and Basic versions support) or need to itemize, the Plus version will probably do the trick. If you’re self-employed or an active trader, consider going all the way up to the Premium package. The Plus and Premium versions will be pricier than the Basic version, so check the TaxAct site for the latest prices.
TaxAct’s paid packages also come with free “identity recovery” help from InfoArmor, which may come in handy if you discover someone has already filed a tax return using your information. The service gives customers a case manager to help them address taxpayer identity theft.
Refunds come in the standard forms (paper check, direct deposit and even U.S. savings bonds), but TaxAct can be an especially good choice for people who want their refunds funneled to a prepaid card.
TurboTax is a good choice for people who want a very intuitive interface, a big community to consult about tax preparation or advice via smartphone.
Weigh whether to pay
The company’s new SmartLook service, which is free for all users, offers real-time help via the TurboTax mobile app. The experts can answer questions and even see your screen, which lets them show you what to do.
But the big downside is that TurboTax is the most expensive of the three options.
Like TaxAct, TurboTax’s free version is only for people filing either Form 1040EZ or Form 1040A. But that includes a lot of people — even folks who have student loan interest to deduct, child tax credits or the Earned Income Credit. You can even upload photos of your W-2s rather than typing all the data in manually.
A noticeable item, though, is that the free version doesn’t have a desktop option — it’s online only. The desktop alternative is the Basic version, which is $39.99 plus $44.99 to e-file a state return.
Prices go up from there.
If you itemize, the Deluxe version may be a good pick, though be prepared to shell out more for it. Choose Premier if you’re an investor or have rental property (though, again, you’ll pay extra to get your state return done). If you’re self-employed, Home & Business is probably what you want, but beware, the prices for that will be higher. Check TurboTax’s site.
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Tina Orem is a staff writer at NerdWallet, a personal finance website. Email: email@example.com.