The start of tax filing season is right around the corner. You might have already received some of your tax paperwork in the mail. And you're probably thinking about which tax software option is the best for you?
Well, we've been reviewing all the major options this season, including TurboTax, H&R Block, TaxAct, TaxSlayer, Credit Karma Tax, and more. And we're breaking down the categories for each "type" of filer and which software makes the most sense for your situation.
If there's something you think we've missed, or don't quite know which is best for you, let us know in the comments! We've seen them all, so we'll try to point you in the right direction.
Best Free Tax Software
If you qualify for free file, you need to be taking advantage of it. The problem is, many tax programs advertise free file, but many don't deliver. Even some of the major programs hook you with free file, only for you later to find out you don't qualify because you have kids, or you have too many deductions, etc.
Winner: H&R Block
Why: H&R Block Online is our top pick for best free tax software because they significantly increased what filers can get for free.
For many companies, free is only for filers who have a 1040-EZ. However, with H&R Block More Zero, you can still get free file if you're a homeowner, people claiming childcare expenses, people with student loan interest deductions, and recipients of the Earned Income Tax Credit (EITC).
Most other companies make ETIC recipients upgrade to their Deluxe version and pay - but not H&R Block.
Also, H&R Block has one of the easiest to use navigation and interfaces.
Runner Up: FreeTax.com
Why: FreeTax.com (also known as DIY Tax) is our runner up for best free tax software because it's one of the only companies that offers truly free tax filing for all individuals, forms, etc.
What holds it back from being the winner is that is definitely is not for inexperienced filers. The software is pretty bare-bones, but it gets the job done.
While it's no frills, it offers every form, every situation, free. That's pretty awesome.
Best Tax Software For Homeowners
Homeowners get their own category because most homeowners end up itemizing their tax returns due to mortgage interest deductions and property tax deductions. As such, most tax filing software bumps homeowners up into their paid levels, so it's important for homeowners to know where they are going to get the best value.
Winner: H&R Block
Why: H&R Block is our top pick for homeowners because they extended their free tier to include some homeowners that qualify. You can deduct your mortgage interest, but if you have other items beyond a Schedule A, H&R Block may require you to upgrade to a higher tier.
However, for just homeowners and not much else, H&R Block is the way to go.
Runner Up: TaxSlayer
Why: TaxSlayer is our runner up for homeowners this year because it offers the best value for paid software. TaxSlayer Classic, which is what homeowners will want, is the most robust, yet best priced software at this level.
Their ease of use rivals that of H&R Block (though still not as easy as TurboTax), but their prices are much better. If you find yourself being upgraded to a paid version as a homeowner using H&R Block, you might want to consider the switch to TaxSlayer to save money.
Best Tax Software For Investors And Traders
Investors and traders typically want (or need) tax software that allows for import of 1099s issued by banks and investing brokers. Especially for investors with a large amount of transactions, it can be extremely tedious to manually enter everything into the computer. Furthermore, it also opens you up for more potential errors.
Winner: TurboTax
Why: TurboTax is the winner for investors and traders because of the ease it is to import everything into TurboTax. Plus, TurboTax connects with the most banks and brokers that we've seen.
If you're concerned about importing a large number of investing transactions, TurboTax is your best bet.
Runner Up: H&R Block
Why: H&R Block is a close runner up to TurboTax when it comes to importing investment information. It also have a wide variety of import features that make it easy to use an appealing for investors.
If you've used H&R Block in the past and want to continue to use it as an investor, you really can't go wrong.
Best Tax Software For Landlords
Landlords have some of the most complicated returns, along with business owners. Keeping track of income, expenses, and depreciation on a property can be tedious, but they are essential for tax time.
We look for software that makes calculating depreciation easy, and allows for easy import of prior year information to ensure continuity across returns.
Winner: TurboTax
Why: TurboTax is the slight winner in this category. TurboTax handles rental property well, allows for easy import of past years information, and what sets it apart from H&R Block is that it connects with QuickBooks. So, if you use Quickbooks to manage your rental property, tax time is a cinch.
Runner Up: H&R Block
Why: H&R Block is our runner up in this category. It handles rental property very well, allows for import of past information, and will keep track of your depreciation year over year. The only thing it really lacks versus TurboTax is connectivity with software like Quickbooks, which would make things a little easier.
Best Tax Software For Side Hustlers
This year, we're separating side hustlers from small business owners because there is a difference we've been noticing in how returns can be handled for each. Side hustlers, in our tax definition, are people who are working in the gig economy on the side, or have small income on the side from selling stuff on eBay, etc.
The interesting thing about side hustlers is that they use different expense tracking apps (like Everlance), and they may be eligible to file a Schedule C-EZ.
Winner: TaxSlayer
Why: TaxSlayer is our choice for side hustlers looking for a great option to file their tax return - but it was close. TaxSlayer has a great, easy to use interface very similar to TurboTax and H&R Block. First time side hustlers might be a little slow at first, but what really sets it apart is cost. With TaxSlayer, you're going to pay about 50% of what you'll pay on H&R Block.
Runner Up: H&R Block
Why: H&R Block was in the running to win this category, because it's done some awesome things this year for side hustlers. First, it's built integrations with many partners - including Uber and others - to automatically import information into your tax return. That can make things really easy. However, the big thing holding us back was the price. While H&R Block is great, it's about twice the price of TaxSlayer for a side hustler.
Best Tax Software For Small Business Owners
Small business owners have a lot to think about when it comes to their tax returns. Beyond just entering income and expenses, there are considerations around business structure, asset depreciation, individual retirement plans, and more.
While many small business owners would likely benefit from an accountant, those that want to DIY it need to have software that is up for the challenge.
Winner: TurboTax
Why: TurboTax has held the title of best tax software for small business owners, and it continues the trend. TurboTax is great for many reasons, but we love the easy to use interface, the connectivity with Quickbooks, and the ability to easily calculate the maximum contribution you can make to a solo 401k.
Runner Up: H&R Block
Why: H&R Block offers an incredibly similar experience to TurboTax, without the connectivity to main provides. While I know that TurboTax has a lock on Quickbooks (they're the same company), I wish H&R Block would connect up with Xero or similar - it would just make sense. However, they haven't. So, while they offer a great experience and easy to use software, they simply lack connectivity for small business owners.
Best Value For Experienced Filers
If you're an experienced filer, maybe you don't care about a good user interface, easy navigation, and helpful knowledge articles and tutorials. Maybe you just want the forms, and want them for the cheapest price possible!
Well, if you're simply an experienced tax filer that wants the best value, here you go.
Winner: FreeTax.com
Why: FreeTax.com is awesome. It's truly free. Every single tax form, everything you could want to file. It's free. No strings attached. Well, one string - it's definitely not sexy tax software, but it gets the job done. If you know what you're doing, FreeTax can be a great choice.
Runner Up: TaxHawk
Why: TaxHawk showed some improvements this year, making their user interface better, and improving overall navigation. It's still pretty bare bones tax software, but if you know what you're doing, they allow free Federal returns, but do charge for state returns.
Best For Those Looking For A Tax Refund Anticipation Loan
While we don't recommend you get a tax refund anticipation loan, we also know we're not your mother and can't tell you what to do. Over 10 million people will get a tax refund anticipation loan - and historically that's meant going into a physical H&R Block or Liberty Tax office and filing your return.
However, one company is changing the game this year, allowing for eligible filers to get a tax refund anticipation loan online if they qualify. This is a game changer because it significantly lowers the cost to filers. When filers go into a branch, they'll typically pay over $300 to process their return. Online, you can get this done for $17!
Winner: TaxSlayer
Why: TaxSlayer is the only company that is offering tax refund anticipation loans to filers who fill out their tax returns online. While the loan amounts aren't much ($500 or $1,000), the convenience of being able to do your return online and get a loan online is awesome.
Tax Software To Avoid This Year
Sadly, there are definitely some popular picks that we're putting on our avoid list this year. In our opinion, these options aren't worth taxpayers using to try to file.
While they may be good value, we've seen or heard about glitches, errors, customer service problems, and more. If you were considering any of these tax companies, think twice and read our review.
1. Credit Karma Tax
Credit Karma Tax was the darling of the tax filing community last year when Credit Karma announced it would be launching truly free tax filing. However, it quickly became clear that they weren't ready for the spotlight yet, and bug, glitches, and an overwhelmed customer service department really made it a difficult choice to use.
We were hoping these things would be fixed, but sadly, they don't appear to be. While it does look like they beefed up their customer service staffing (but it's still too early in the tax season to know for sure), we're already seeing user issues. We also found our navigation experience to be clunky - a reversal of what they did last year.
Overall, if you're looking for free filing, you'll find better options with H&R Block More Zero.
2. OnlineTaxes (OLT.com)
OLT.com (Online Taxes) is an interesting product. They have great pricing on their tax software, with free Federal filing. But their user interface and navigation is hard to use. And if you're only looking at price, there's better options out there that provide a much better user experience.
While OnlineTaxes.com has potential, we have it on our software to avoid list this year because of how difficult it is to use. Just watch my review view - my frustration comes through loud and clear.
3. EZTaxReturn.com
EZTaxReturn should be an avoid for most people, simply for the sheer fact that they don't support rental properties, wash sales and other investment tax concerns, and more. If you have a simple return, they can definitely do it, but we also found their software to be a bit glitchy, and the navigation was poor.
The bottom line is that there are much better software out there - even at their free level. Our opinion is that nobody should use this due to the unsupported forms and glitches we encountered during our review.
4. 1040NOW
1040Now is the best of 1997 internet. It's layout is old and antiquated, but that's not what puts them on the do not recommend list. 1040NOW has a big problem - it doesn't catch user errors. We tested entering a SEP IRA contribution with no self employment income, and it allowed it! Not having basic error checking is a cardinal sin for tax software, and filers could be in a lot of trouble because of simple data entry errors that the software didn't catch.
I like H&R Block… but I still qualify for their free tax filing so I guess I’m a little biased. Some of these other ones might be better if you’re going to have to pay to file anyways.
I used TurboTax again this week for the 6 year in a row and find it to consistently be the best for investors. Thanks for this detailed list of other options.
Why not use the free file on IRS.gov?
Do you mean the free fillable forms? Those are difficult for most to use unless they are experienced. All of the companies as part of the free file alliance as listed on IRS.gov aren’t always free depending on your tax situation. You can see that here: https://thecollegeinvestor.com/17356/free-tax-filing-companies-really-free/
what tax software would you recommend for international college students? or dual-citizen people? thanks
I would recommend TurboTax as it has the most robust and easy to use features. H&R Block is a close second, although I can’t remember much about non resident tax returns.