There are so many different options when it comes to tax software, and it can be very confusing to figure out which is best. What makes it even more confusing is that many of the companies "hide" the real cost of their software.
You see, most companies are simply advertising the "Federal Return" price, and not other costs, such as State filing, and e-Filing fees that may be included. On the other hand, other companies include everything in just one price.
Even when you see "Free Federal", it doesn't really mean free - you'll likely be paying something to file your taxes. We break down who is really offering free tax software here.
We compared the prices of all versions of TurboTax, H&R Block, and Tax Act for the 2019-2020 tax season to really help you understand what you're getting. This article isn't about the features, so much as the price (we bucketed the programs in the closest features per version).
If you don't know what tax software is right for you, check out our guide to the Best Tax Software which breaks down our picks based on your tax situation.
To make matters even more complicated, there are different prices for the online and download editions of every product. My head hurts just thinking about it.
There are three big changes for the 2019-2020 tax season:
- H&R Block continues to be one of the best price to value ratios on the market. We especially like that they expanded their Free Online Tax Filing option to include some itemized deductions, and they made their free edition truly free. This could help a lot of people who itemize. Read our full H&R Block Review.
- TaxAct increased their prices and tiers again this year, while not really brining in a lot of value to justify the price increases. Read our full TaxAct review here.
- TurboTax Free Edition is still one of the easiest to use options, but they are the highest priced software this year, and their free level isn't as good as H&R Block. Read our full TurboTax review here.
Another big change this year is that all of these companies are offering some type of paid "help" or assist from a tax professional. These add-ons are available on every tier, but both H&R Block and TurboTax price these additionally - so you can clearly see the costs. TaxAct offers support from a specialist, but only on their Premier and Self-Employed Tier.
** An important disclaimer is that these comparisons are based on full-priced offers. These offers tend to go up significantly in March and April. For example, TurboTax updated prices on March 1.
Along those lines, we also discovered the Amazon.com is offering great deals on TurboTax. This year they are offering an Amazon exclusive edition of TurboTax - check out the Amazon exclusive TurboTax here.
Amazon is offering a great deal on H&R Block, as well as a 4% refund bonus if yo get an Amazon gift card. Check out the H&R Block deal on Amazon here.
Comparing Online Free Editions
Let's take a look at the online free editions for each company and see how they compare.
| TurboTax Free | H&R Block Free | TaxAct Free |
|---|---|---|---|
Federal Return | $0 | $0 | $0 |
Federal eFile | $0 | $0 | $0 |
State Return | $0 | $0 | $0 |
State eFile | $0 | $0 | $0 |
Total Price | $0 | $0 | $0 |
|
I'm excited to see that all of the "big 3" tax companies are offering truly free "Free" editions this year. While this continues the trend of the prior years, each service does include a different amount of features in their free level.
H&R Block offers the most options in their free tier, including homeowners, people claiming childcare expenses, student loan interest deduction or charitable deductions and recipients of the earned income tax credit.
Given that all three companies offer Free filing, we recommend H&R Block 2020, as it's easy to use, but includes the most option for free filers.
Comparing Online Deluxe Editions
Next, let's look at the online "Deluxe" editions of each product. It's important to note that this is a really strange tier. I really hate this product because it typically is what gets people who think they qualify for free file, but actually have to pay for the service - usually because they have something like an HSA that makes them upgrade.
For example, you get half way through your return and learn you need to pay for a feature or tax deduction, this is the tier you usually end up at.
In many cases, H&R Block Free Online Tax Filing is a great choice for people who might fall into this tier because it's actually free.
Note: If you fall into this tier and have a basic tax return, you might check out Credit Karma Tax. It's 100% free, and does have some limitations, but people who fall into this category will usually find value at Credit Karma Tax.
| TurboTax Deluxe | H&R Block Deluxe | TaxAct Deluxe+ |
|---|---|---|---|
Federal Return | $60 | $29.99 | $29.95 |
Federal eFile | $0 | $0 | $0 |
State Return | $50 | $36.99 | $39.95 |
State eFile | $0 | $0 | $0 |
Total Price | $110 | $66.98 | $69.90 |
|
This year, with TaxAct's higher prices, H&R Block not only has the most features, but also has slightly better pricing as well.
Comparing Online Premium Editions
This is where the versions really matter. Make sure you read what different options are offered. This tier is many geared towards homeowners, investors, and some side hustlers.
It's important to note that H&R Block allows the Schedule C-EZ with their Premium version, which could be a good deal for some side hustlers (versus having to upgrade all the way to the Self-Employed version).
This is the tier that saw the biggest price increase this year. Every provider increased the price of this version significantly versus prior years.
| TurboTax Premier | H&R Block Premium | TaxAct Premier+ |
|---|---|---|---|
Federal Return | $90 | $49.99 | $39.95 |
Federal eFile | $0 | $0 | $0 |
State Return | $50 | $36.99 | $39.95 |
State eFile | $0 | $0 | $0 |
Total Price | $140 | $86.98 | $79.90 |
|
Once again, TaxAct is the lowest price offering. However, not by much this year. In fact, we still think you should consider the TaxAct Alternatives - or even go off this list and check out TaxSlayer at this tier. TaxSlayer offers every form for a great price.
Based on our experiences, we recommend H&R Block Premium for this tier as well, as the extra $7 is worth the experience.
Comparing Online Small Business Editions
Each of the three companies offer a small business edition of their software. This is important if you are filing a Schedule C for your tax return (which is for side hustlers as well).
TurboTax has historically been the leader in this space in terms of ease of use, integrations (with Quickbooks), and more, but they are the highest priced option.
If you're a side hustler, you're going to find a lot of value with H&R Block, and also with new-comer TaxSlayer.
| TurboTax Self Employed | H&R Block Self Employed | TaxAct Self Employed+ |
|---|---|---|---|
Federal Return | $120 | $79.99 | $74.95 |
Federal eFile | $0 | $0 | $0 |
State Return | $50 | $36.99 | $36.95 |
State eFile | $0 | $0 | $0 |
Total Price | $170 | $116.98 | $114.90 |
|
TaxAct was the lowest priced version last year by a huge margin ($30 or more). However, they significantly raised their prices on this tier, making them much less appealing.
However, a new player this year is TaxSlayer which you might consider for your self employed return. It's not listed here, but it's a strong player in this space. Check out our full TaxSlayer review here.
If you don't want to try something new, check out H&R Block Self Employed.
Comparing Download Editions of TurboTax, H&R Block, and TaxAct
Just when you thought things couldn't get more complicated, each company offers a downloadable version of their software. This is designed for people who want to do their taxes while NOT being online. This is a more expensive way to go, and the pricing is very different from the online versions for many of the companies.
Remember, you might have better luck on pricing shopping on Amazon.com - we already discussed how Amazon has an exclusive price on TurboTax this year.
This is also the same version of the software that you'll typically find in retail stores, if you buy the CD. As such, you may be able to find cheaper pricing online from retailers.
We don't recommend people use downloadable software. The online versions are safer and more up-to-date. But, we know there are some old school people out there still!
Comparing Downloadable Basic Editions
| TurboTax Basic | H&R Block Basic | TaxAct Basic |
|---|---|---|---|
Federal Return | $39.99 | $29.95 | $26.95 |
Federal eFile | $0 | $0 | $0 |
State Return | $39.99 | $39.95 | $49.95 |
State eFile | $19.99 | $19.95 | $9.99 |
Total Price | $99.97 | $89.85 | $86.89 |
|
TaxAct is still the low priced option for basic editions. However, I recommend that you avoid the basic editions, they are actually higher priced than other options. And if you need a basic edition, you might be better served by using one of the free tax software choices like Credit Karma Tax.
Comparing Downloadable Deluxe Editions
| TurboTax Deluxe | H&R Block Deluxe | TaxAct Deluxe |
|---|---|---|---|
Federal Return | $69.99 | $54.95 | $96.90 |
Federal eFile | $0 | $0 | $0 |
State Return | $0 | $0 | $0 |
State eFile | $19.99 | $19.95 | $9.99 |
Total Price | $89.98 | $74.90 | $106.89 |
|
I don't know if you noticed, but the Deluxe versions of TurboTax and H&R Block are actually cheaper than the basic versions. Talk about marketing gimmicks!
This year, H&R Block Deluxe takes the lead as the cheapest downloadable deluxe option. TaxAct significantly increased the price of their Deluxe version and we couldn't really find a reason for it.
Comparing Downloadable Premium Editions
| TurboTax Premier | H&R Block Premium | TaxAct Premier |
|---|---|---|---|
Federal Return | $99.99 | $74.95 | $101.90 |
Federal eFile | $0 | $0 | $0 |
State Return | $0 | $0 | $0 |
State eFile | $19.99 | $19.95 | $9.99 |
Total Price | $119.98 | $94.90 | $111.89 |
|
This year, H&R Block Premium takes the lead on download Premium Edition pricing as well.
Comparing Downloadable Small Business Editions
| TurboTax Self Home & Business | H&R Block Premium & Business | TaxAct Self-Employed |
|---|---|---|---|
Federal Return | $109.99 | $89.95 | $124.90 |
Federal eFile | $0 | $0 | $0 |
State Return | $0 | $0 | $0 |
State eFile | $19.99 | $19.95 | $9.99 |
Total Price | $129.98 | $109.90 | $134.89 |
|
H&R Block is the cheapest this year since TaxAct raised their prices by about $30 on this version. Check out H&R Block Premium & Business here.
Conclusion
After looking at the pricing of every edition from all three companies, it became clear that a trend emerged: H&R Block has become a value leader in the "major" tax products space. They've lowered their pricing on most products, and launched a robust free filing option.
If you're looking at the battle between TurboTax and H&R Block, H&R Block is our recommendation. If you want to buy software to download or buy software in the store, H&R Block is usually always the cheapest option.
Check out our full H&R Block review if you're curious about using it this year.
What are your thoughts on tax software pricing? Have you used any of these companies?
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.