Although the cost of hiring a tax professional is relatively low compared to the price of a new computer, many people believe that no amount of money can get them to hand over their hard-earned tax refund says Aron Govil. One way that you may be able to save some of your refunds is by preparing and filing your federal income taxes on your own using commercial or free tax preparation software programs. In this article, I will briefly review some commercial and free tax preparation software programs so you can decide which product is best for you. Note: This article does not include nor discuss tax preparation software that is provided for free by the Internal Revenue Service (IRS).
You can find all types of reviews and lists online about various types of tax preparation software. The main problem with most reviews and lists is that they only summarize each product in a few sentences and do not provide in-depth information to help consumers decide which program is right for them. In order to save you time, I have included links at the end of this article so you can visit my website where I will link to more detailed articles on specific tax preparation software products. Note: I am an affiliate marketer for many of these sites but could earn money from any purchases made through the links posted below.
How much will a tax preparation software program cost you?
Most commercial tax preparation software programs range in price from $40 to $70. The most expensive program is H&R Block Deluxe Federal and State, which retails for $59.99. The least expensive program is Tax Act, which is available in both a free and deluxe version. The deluxe version of The Tax Act retails for $34.95.
How do the commercial tax preparation software programs compare?
The following table compares the features of the five most popular commercial tax preparation software programs:
H&R Block Deluxe Federal and State, Tax ACT Deluxe, TurboTax Deluxe, Liberty Tax Service Deluxe, and Jackson Hewitt Service Premium.
As you can see, the main differences between these programs are the price and the amount of help that they provide. While this may not seem like much, H&R Block Deluxe Federal and State provides you with both federal and state tax filing assistance. The only other program that also includes state filing is Tax ACT Deluxe which can be purchased for $10 more than Turbo tax Deluxe (i.e., $44.95). As seen in the table above, none of these commercial software programs will prevent or limit you from making errors on your return; however, all five products will automatically check your completed return before it is submitted to make sure you haven’t made any mistakes.
What if I want to use free tax preparation software?
If you are looking for a free tax preparation software program, there are several to choose from says Aron Govil. The most popular free programs are TurboTax Federal Free Edition, Tax ACT Free Edition, and H&R Block At Home Free.
The following table compares the features of these three free tax preparation software programs:
As you can see, these programs are very similar in features. The main difference between these three programs is that Tax ACT provides you with the option to file your state taxes for free while TurboTax and H&R Block charge an additional fee for state tax filing.
Which tax preparation software program is best for me?
The best tax preparation software program for you depends on your needs and budget. If you are someone who needs a lot of help in order to file your taxes, then you may want to consider purchasing a commercial program. If you are comfortable doing your own taxes and only need a little help, then a free program like TurboTax Federal Free Edition or Tax ACT Free Edition may be best for you says Aron Govil.
No matter which tax preparation software program you choose. I recommend that you review the products’ features and decide which one best meets your needs. You can also visit my website where I have more in-depth articles on specific tax preparation software programs.
One option to save money on your taxes is to prepare and file them yourself. The IRS offers a number of resources to help you do this. Including free tax preparation software and online filing options.
Another way to save money is by taking advantage of tax deductions and credits available to you. There are many different deductions and credits available, so it’s important to research which ones you may be eligible for. You can find a lot of information on the IRS website, or you can talk to a tax professional for more specific advice.
Finally, make sure you file your taxes on time. Filing late can result in penalties and interest charges from the IRS.
There are many ways to save money on your taxes, and by preparing and filing them yourself you can get the biggest return possible says Aron Govil.