Updated April 1, 2020 to add information on the tax-filing deadline extension due to COVID-19. (No, this is not an April Fools’ gag!)
In normal circumstances, the countdown to getting your 2019 taxes filed would begin in earnest today. But seeing as circumstances are far from normal, the deadline for filing both federal and state taxes has been extended. (Good news, procrastinators!) All federal taxes are now due on July 15, 2020. As TurboTax points out in a helpful FAQ, no additional action is required on your part to be eligible for the federal extension—it applies across the board.
The extension for state taxes, on the other hand, varies among states. Most states are sticking with the same July 15 deadline, but you can check on your state for more information.
That being said, there is nothing preventing you from filing taxes now, and a refund could actually be very helpful at this time. The IRS says the extension does not hamper its ability to send out refund checks promptly.
To help you in this yearly ritual, we walk you through some important points to consider before choosing an online tax-filing service, and then give you the pros and cons of each one, so the process of filing your income taxes is as trouble-free as possible.
Which software app should you use?
When it comes to the basics of filing your personal taxes, there is very little that differentiates these apps from each other, so, to some extent, you should go with whichever of the companies you’re comfortable with or that you’ve used in the past. The truth is, if you have the proper paperwork, filing your taxes is nothing more than correctly entering data from forms you’ve been given by your employer and your banking institutions. But, if you’re unsure about which app you should choose, or you have specific needs, use the following information and our reviews as your guide:
If you’re filing personal taxes and you made $69,000 or less last year
Have a look at our guide to the IRS’ free file options. TurboTax, H&R Block, TaxAct, and
TaxSlayer, as well as some other companies, have offerings for anyone meeting the IRS standard for free filing.
If you’re an active member of the military
TaxSlayer is, hands down, your best choice. It offers free filing, no matter your filing status, for anyone who is an active member of the military.
If you own a business that’s incorporated
TaxAct is the only choice for you. Of all the tax software available, TaxAct is the only online offering that lets you file your business taxes and then import important information, such as K-1s, directly into your personal 1040 filing.
If you’re self-employed
TurboTax is the choice for you, largely because anyone using TurboTax Self-Employed also gets a one-year subscription to QuickBooks Self-Employed at no additional cost. Conversely, if you’re already paying for QuickBooks Self-Employed you can easily import your financial data into TurboTax Online and file your taxes for free.
If you want the option to sit down with a real human being
H&R Block is the app for you. It’s the only option available that will let you take your return to the H&R Block office around the corner and have a living, breathing human being walk you through your tax filing process.
State taxes are (almost) never free
Unless you live in a state that doesn’t have income tax or you qualify for one of the free file programs, be prepared to pay somewhere between $30 to $40 to file your state taxes.
TaxAct has been, for the last several years, the most versatile of all the available online tax filing applications, largely because it offers the broadest set of options. To my knowledge it is the only online offering that lets you file corporate taxes online. It also allows you to import your K-1 directly from your corp taxes into your personal tax filing, making it the only one-stop shop for all your tax needs. Additionally, if you’re an accountant, TaxAct offers options for professionals as well.
Prices for filing your taxes with TaxAct have increased ever so slightly for the Self-Employed option and been reduced for all the other versions of the app. TaxAct has eliminated Basic by rolling its features into the Free and Deluxe versions of the app. Here’s what you’ll pay for TaxAct:
- $0 for Free, which covers a basic filing for a 1040
- $35 for Deluxe+, if you need an itemized tax filing
- $50 for Premier+, if you have investments and rental property
- $80 for Self-Employed+, for individuals reporting self-employment income
If you’re interested in filing your business taxes, see TaxAct’s various business returns.
The interview process
TaxAct’s interview process has improved this year and now begins before you even log in to do your taxes. At the top of the homepage you can select the types of tax-related issues that apply to you, such as W-2 income, whether you’re a home owner, have children, or work for yourself. As you select each item, TaxAct highlights the specific package you’ll need to file your taxes, eliminating any last minute surprises about how much you’ll need to pay to file your return.
Once you’ve selected a package, the rest of the interview process is simple and straightforward. If you’ve filed with TaxAct in the past, last year’s return information can automatically be imported into this year’s return, including specifics such as your employer’s EIN, dependent information, and any other information from last year’s filing. If info is no longer pertinent—say, your mortgage bank has changed—it’s easy to remove and add a new option.
If this is your first time filing with TaxAct, it’s equally as easy to get your info entered. If you used a different app last year, TaxAct can import all your information from last year’s PDF, which you can then double-check to ensure that it’s imported correctly. If you’re starting from scratch and have to enter your information manually, TaxAct’s step-by-step guidance makes the process simple. If you get stuck, TaxAct offers excellent help options, but beware: It uses pop-up windows for help, so you’ll need to disable your pop-up blocker for help to work. Also, if you’re filing using Premiere+ or Self-Employed+, you have access to priority support with a dedicated phone line and screen-sharing capabilities.
Once you’ve entered all your information, TaxAct’s summary screen explains in simple detail why it is that you’ve received a refund or had to pay more in taxes.
TaxAct remains my personal tax filing favorite. It’s what I’ve uses to file my taxes for the last several years and that’s largely because of how well it handles filing my business taxes and how that integrates with filing my personal taxes. TaxAct’s improved interview process and its simple data-entry features inspire confidence and make filing your taxes simple and easy.
H&R Block review
H&R Block is a familiar face. It’s the place you see on nearly every corner and, this time of year, with flags flying on the street to catch your attention and beckon you in. That familiarity creates a well-earned sense of trust that extends beyond H&R Block’s brick-and-mortar operation to its desktop and online tax apps.
As I’ve noted over the last couple of years, H&R Block for tax prep is a solid and straightforward option with an easy-to-use interface.
To that end, H&R Block has what it refers to as a transparent pricing policy, part of its “No Surprise Guarantee.” In addition to clear pricing up front, this guarantee also includes free audit assistance and a free mid-year tax check-in.
Pricing for H&R Block remains unchanged from last year:
- $0 for Free Online, which covers a basic 1040
- $30 for Deluxe Online, which includes itemized deductions
- $50 for Premium Online for those with special income needs, including contract work and rental income
- $80 for Self-Employed Online, if your return includes self-employment or small business income
As of the 2019 tax season, H&R Block offers two new interactive tax prep options. The first is called Tax Pro Go. This new service lets you get your taxes prepared by a tax prep professional without ever having to go to one of H&R Block’s brick-and-mortar stores. Instead, you can upload all your documents and then communicate with your tax prep professional using secure messaging through the app or via telephone. Pricing for Tax Pro Go ranges from $50 for a basic filing to $249 for a self-employed return. The second, which is a part of H&R Block’s standard filing options is called Online Assist, which you can purchase as an adjunct to the standard online offerings with the additional benefit of unlimited access to a live tax expert.
The interview process
No matter which tax app you’re using, the interview process is the key to a good experience. As noted in last year’s review, H&R Block has made significant improvements on this front. While the interface maintains last year’s look and feel, the interview screens are clear and easy to read and if you choose to bring up the help screen it will follow where you are in the interview process, giving you detailed information and answers to whatever question you are at.
H&R Block has a simple scanning tool for adding W-2 information that does not require you to download a separate app. Instead, you can have a link sent to you that allows your W-2 to be scanned on your phone and inserted into your return. I tested this feature a couple of times and found it to be an excellent way to enter my W-2 info, with text recognition that worked perfectly.
If you do choose to download the H&R Block app for your mobile device, you’ll be pleased to note that you can start your tax filing process on one device and continue from wherever you leave off in your return on a completely different device, all with no friction.
H&R Block was already a solid tax filing application. Now, with the addition of several interactive options giving you direct access to real tax professionals, H&R Block remains a worthwhile tool for getting your taxes filed with confidence and ease.
TurboTaxis king of the hill. The 10,000 pound gorilla. The tax app to beat. And that’s for good reason. It remains one of the best interfaces available for filing your taxes. Its clean design, soft, calming colors, and clear directions all combine to provide you with a tax filing experience that’s unparalleled.
In addition to the usual tax filing options, TurboTax also offers its packages with an updated version of TurboTax Live (at an added cost), which gives you direct access to a “live CPA or enrolled agent” in real time so you can ask questions and get all your tax information checked whenever you feel the need. The upside to this is that you don’t need to leave home to have your taxes checked by a pro.
At the time of this writing pricing for TurboTax was discounted. The pricing listed here does not reflect that discount. And based on prior experience, Intuit raises its prices the closer you get to April 15. Check out the TurboTax website to see what the pricing is today.
Intuit’s normal price for TurboTax is as follows:
- $0 for Free Edition, for basic filers
- $60 for Deluxe, which is what most tax filers will use
- $90 for Premier, for filers with rental property or investment income
- $120 for Self-Employed, for anyone running a personal business that isn’t a corporation; this version is compatible with QuickBooks Self-Employed, which you can use for free if you use TurboTax Self-Employed. Similarly, if you’re already using QuickBooks Self-employed, you can file your taxes using TurboTax Self-Employed for free.
TurboTax Live is priced at:
- $80 for Basic
- $120 for Deluxe
- $170 for Premier
- $200 for Self-Employed
The interview process
TurboTax now offers a pre-sign-in interview that helps you select which of its tax products is best suited to your specific situation. Once you complete this interview and choose the package you want, you sign in or create a new account to begin the process of entering your financial information.
If you’ve filed taxes with TurboTax in the past, most of your data will already be entered when you begin the interview process, as TurboTax imports that data from your account and prior returns. All of the questions in the TurboTax interview are easy to answer. It’s really as simple as having all your documents on hand so you can enter the numbers when you’re asked to.
TurboTax offers the option to scan your W-2 with your phone, but only when you’re using the TurboTax mobile app. The upside is that you can easily bounce between the phone version and the online version of TurboTax, so entering your W-2 info by scanning it is as easy as signing in to the app on your phone.