TurboTax Cost

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Comparing The Online “Self-Employed” Tax Filing Software

The self-employed filing software is required for anyone who had Schedule C (self-employment) income. Given the rocky economic conditions of 2021, I suspect that a lot of people have done some gig work this year. All of those side hustlers will need to upgrade to this tier for their filing.

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TurboTax Deluxe

This is the most popular edition of TurboTax since it’s designed for preparing Form 1040.

You can use this version if you itemize deductions and if your income is too high to qualify for the free edition of the program.

Note: If you’re self-employed or you own rental real estate, you’ll need to use a different edition, which we go over in detail in the next section. 

TurboTax Deluxe comes with all the features of the Free Edition, plus:

  • Deduction Finder. TurboTax searches for more than 350 tax deductions and credits, which can help you get you the biggest refund possible.
  • One-on-one help, on demand. A TurboTax specialist is available to provide customized answers to your tax questions. They can even patch into your computer screen to provide you with the most specific information.
  • Easy importing. If you used TurboTax to prepare your return last year, your information is automatically transferred to this year’s return. You can also import a PDF of last year’s return from other major tax-prep services. Either way, you save time and effort.
  • Your refund in real time. TurboTax software updates your tax refund as you proceed through their questionnaire, which helps you see how information you input impacts your total tax bill (or refund).

HR Block vs. TurboTax: Cost

Cost is always a consideration when you choose a tax filing service. H&R Block and TurboTax are the two most comprehensive online services available and likewise they are also some of the most expensive. However, while H&R Block was once cheaper than TurboTax, the companies are now nearly perfectly aligned when it comes to cost.

As mentioned, both services offer a free option, covering simple returns. You can also file some additional schedules and forms with this option. However, H&R Block does cover more forms and schedules with its free option. It also allows you to file multiple state returns for free. By contrast, the free plan from TurboTax includes only one free state return. This all gives H&R Block a slight advantage if you qualify for the free option.

It’s great if you can file your taxes for free, but the average filer will need to upgrade to another option. The Deluxe option is enough for many filers. Both Deluxe options include deduction-finding software, help with charitable donations and access to tax financial experts through online chat.

There are a couple of big differences between the options in the forms that they support. TurboTax’s Deluxe option supports Schedule SE, which allows you to file self-employment taxes. It also allows you to file Schedule C and Schedule C-EZ if you have business income to report but do not have any expenses to report.

If price is your primary concern, you may want to consider a cheaper service like TaxAct. TaxAct is well-known for being affordable but it doesn’t quite provide the same level of simplicity and educational material that these two services offer.

Bottom Line

So, who wins? Well, it depends what exactly you’re looking to do. H&R Block covers more filers with its free option. The two Deluxe options are the same in terms of price, but TurboTax’s Deluxe option supports more forms that self-employed, freelance and contract workers may need. Both services are user-friendly but TurboTax is slightly simpler with more straightforward language.

Beyond these factors, which tax filing service you choose may come down to personal preference. Some people prefer one over the other because they simply like the way it looks. They might also choose H&R Block so they can have the option of filing at a physical location.

Of course H&R Block and TurboTax are not the only two tax filing services. You may want to consider other options like TaxAct or TaxSlayer if you’re looking for a budget option. Credit Karma also allows you to file entirely for free.

TurboTax Pricing

TurboTax offers several pricing options, starting from a free version* for users with straightforward tax returns to pricier packages for people who’d rather turn their taxes over to a professional.

Those pricing options generally fall into three categories:

  • Do-it-yourself: If you feel comfortable filing on your own with step-by-step guidance
  • TurboTax Live: To get unlimited help and advice from a tax expert while you do your taxes, plus a review of your return before you file
  • Full Service: A tax expert prepares, signs and files your tax return for you

Currently, those pricing tiers are:

Package Price Includes
Free Edition* $0
  • Free filing of federal and state returns*
  • Covers W-2 income, limited interest and dividend income, the Earned Income Credit, Child Tax Credit, the standard deduction, and student loan interest deduction
Do-it-yourself options Deluxe $59 Federal $49 Per State
  • Allows itemized deductions
Premier $89 Federal $49 Per State
  • Allows reporting of capital gains and losses
  • Allows reporting of income and expenses from rental properties and pass-through businesses
Self-Employed $119 Federal$49 Per State
  • Allows reporting of income from a trade or business, contract work, and freelancing
  • Also works for the home office deduction
Basic $79 Federal & State
  • Essentially the free version but with on-demand help from a tax pro via video and a final review of your self-prepared return
TurboTax Live Deluxe $119 Federal$54 Per State
  • Everything included in Deluxe, plus on-demand help from a tax pro via video and a final review of your self-prepared return
Premier $169 Federal $54 Per State
  • Everything included in Premier, plus on-demand help from a tax pro via video and a final review of your self-prepared return
Self-Employed $199 Federal $54 Per State
  • Everything included in Self-Employed, plus on-demand help from a tax pro via video and a final review of your self-prepared return
Basic $199 Federal and State
  • Everything included in the free version, but a tax pro prepares your return for you
Full-Service Deluxe $249 Federal $54 Per State
  • Everything included in the Deluxe version, but a tax pro prepares your return for you
Premier $359 Federal $54 Per State
  • Everything included in the Premier version, but a tax pro prepares your return for you
Self-Employed $389 Federal $54 Per State
  • Everything included in the Self-Employed version, but a tax pro prepares your return for you

*For simple tax returns only. See if you qualify.

These prices reflect the list prices advertised as of Feb. 10, 2022, without any discounts that TurboTax may offer to people who file early in the tax filing season. If you want to pay your filing fee out of your federal refund, TurboTax charges an extra $39 refund processing fee for the convenience.

Is TurboTax Live worth the cost?

In our view, most tax situations will not require TurboTax’s expert help upgrades. The main strength of TurboTax is that it’s accessible and comprehensive, meaning that the process offers enough information that you don’t need to dig to find it. Many of your questions can be answered through its online resources. That makes the added Live assistance category, where you can ask an expert questions and have them review your return at the end, mostly unnecessary. 

The category of Full Service is akin to a separate product. You’re simply sending your tax documents to a CPA or tax preparer, so you’re not using any of TurboTax’s interface — it’s just a way to find a qualified tax preparer through TurboTax. Our recommendation would be to compare the cost of a local tax expert with TurboTax’s Full Service option to determine which makes sense for you. 

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Providing the Details

TurboTax Deluxe takes a path similar to the one you’d take if you were working your way through Form 1040. It first asks about income, then deductions and credits, then other tax situations. As you move into the income section, the site asks questions about income you might have. If you answer yes to some of these questions, TurboTax asks if you want to upgrade.

Next, it displays a list of all the income topics that might apply to you. If you think anything is missing, you can ask to see the whole list, including Wages and Salaries, Unemployment, and Interest and Dividends. Click the Start button next to one of these (like Other Common Income), and a multiscreen wizard opens that provides more information, asks questions, and provides blank fields or multiple-choice lists for your answers. 

When you’re finished with one income type, you click Done to go back to the income list. The Start button next to the topic you just completed changes to Edit/Add, which allows you to go back and make changes. Once you’ve visited all the entries that apply to you, you click Wrap up Income to move on. 

The other two main sections of TurboTax (Other Tax Situations and Deductions & Credits) work the same way. If you make your way through your tax return sequentially, answering all the questions, you shouldn’t get lost, even if you have to use the Back button occasionally. You can always use the Topic List if you have to return to a section you already visited.

TurboTax encourages you to provide more thorough documentation than some competing sites, such as Cash App Taxes, and that could be a lifesaver if you’re ever audited. When you enter charitable donations, for example, it asks you to select things such as the type, the recipient, amount, and frequency.

A Familiar Format

Many personal tax preparation services still use a format similar to the one Intuit introduced for its desktop software products in 1993, and with good reason. It works beautifully, saving time, easing frustration, and dramatically reducing errors. Instead of shifting your attention between the Form 1040, related forms and schedules, IRS instructions, and third-party reference books, you go through the tax preparation screens one at a time in a logical order.

Though TurboTax originated this trend of using a wizard-based approach to tax preparation, the practice has evolved substantially over the years. The service alternates between stepping you through a Q&A and displaying a list of available tax topics. You provide an answer, click a button to advance to the next screen, and keep answering and clicking until the service says you’re done. Next, it combs through your return, lets you fix any problems, and helps you file or print the finished product after you pay for your federal (and state, if needed) returns.

You never have to look at an IRS form or schedule, because TurboTax and its competitors complete them for you in the background. What you do see is expert help in the form of simply worded explanations of tax concepts throughout the process.

Should You Sign Up with TurboTax?

If you decide to use a tax software program, you can’t do better than TurboTax. Not only is it incredibly user-friendly, but you can get help from tax experts at any time during the preparation process. Better yet, TurboTax is actually priced lower for 2021 than it was for the previous tax year. This means you can get the help you need at a lower cost than normal, which means more money in your pocket by the time you file.

The TurboTax Live option, which is available at a very reasonable cost, also enables you to get direct tax preparation assistance from either a CPA or an enrolled agent.

You can work the return as far as you’re able, then bring in the tax expert to help you with what you don’t understand. You can even have that expert help you prepare and complete the return on your behalf, and all through remote access.

As a final important bonus, TurboTax also offers both audit assistance and audit defense — it’s your choice. In the unfortunate event you do face an audit, TurboTax can make sure that you’re not doing it completely alone. And as complicated as the tax code is, that’s an important feature to have.

How TurboTax Stacks Up

TurboTax is one of the best-known tax prep products around, but it’s not the only option. This chart shows how it stacks up against H&R Block, perhaps its biggest direct competitor.

TurboTaxH&R Block
Free PlanYes, for simple situations only*Yes, for simple situations only
Expert AssistanceYes, starting at about $40Yes, free online for simple situations; starting at $80 for more complicated situations
Pay With Your Refund?Yes, for a feeYes, for a fee
Cost for Self-EmployedFilersAbout $85 and upAbout $110 and up

*For simple tax returns only. See if you qualify.

TurboTax Live Full Service

  • Cost: $0 federal + $0 state for Basic; $249 federal + $39 state for Deluxe; $359 federal + $39 state for Premier; $389 federal + $39 state for Self-Employed
  • Should you get it? This is as hands-off as it gets. A tax expert will prep, sign, and even file your taxes. It comes with a hefty price tag, but if not having to worry about taxes is worth it to you then absolutely do it. 
  • Free alternative: None that we could find at this level, unless you qualify for the VITA or TCE programs.

Advantages of TurboTax

TurboTax has a lot going for it, from great customer service to useful tools that make preparing complex tax situations easier. 

  • Comprehensive Customer Service and Peer Support Resources. TurboTax’s customer support system, anchored by a vast peer support network and a well-staffed phone support hotline, is impressively robust. I’ve never had a question I couldn’t answer by searching through TurboTax’s knowledge base and peer forums, and I’m usually the type of person who prefers a back-and-forth conversation. 
  • Military Discounts Are Better Than Some Competitors. TurboTax offers discounts or completely free filing options to certain active-duty and reserve military members. Specifically, lower-ranked enlistees qualify for a free upgrade to TurboTax Deluxe. These deals are better than those offered by competitors that don’t offer free upgrades for lower-ranked enlistees.
  • Automatic Transaction Importing and Cost Basis Calculation. If you have a brokerage account, you can quickly and easily import a complete transaction record for the previous tax year by selecting “Add Other Documents” from the Import Summary menu in your TurboTax interface. You don’t need to download a PDF or any other file type — the importing is automatic. If you made lots of securities trades during the year or simply don’t like the tedious process of entering each transaction individually, it’s a big help.
  • Ideal for Mobile Users. With a mobile-responsive website and apps for iOS and Android, TurboTax is ideal for filers who prefer to use mobile devices. Though the tax prep space has by and large grown more mobile-friendly in recent years, some laggards remain — notably, eSmart Tax and FreeTaxUSA aren’t nearly as mobile-friendly. Both have cluttered text and navigation systems that are difficult to navigate on a touchscreen.
  • TurboTax Live Is Great for Filers Who Need More Help. Even if you’re not a small-business owner, the ability to connect with a tax expert on demand is a big confidence-booster. Though Live packages are more expensive than their DIY counterparts, the service is still substantially cheaper than traditional independent tax preparers.

TurboTax Deluxe Edition

  • Cost: $39 for federal + $39 for state
  • Should you get it? If the idea of doing your taxes yourself is daunting, then yes. You’ll find comfort in TurboTax’s search of 350+ tax deductions, credits, and homeowner tax breaks to ensure you get the maximum refund.  
  • Free alternative: Prepare your taxes yourself with Free File Fillable Forms from the IRS. You can also avoid the $39 TurboTax fee for state by filing through your state’s website for free.

Is TurboTax reliable and safe?

TurboTax keeps your information secure with data encryption. It also requires multi-factor authentication every time you log in to verify your identity.

One of the biggest complaints about TurboTax is the ease with which it attempts to upgrade users to the next-tier product. A 2019 investigation by ProPublica found that Intuit, TurboTax’s parent company, was deliberately hiding its free filing services from Google and other search engines. As of this writing, TurboTax’s free file options are clearly advertised.

TurboTax is a leader in tax preparation services for a reason. Millions of people come back to TurboTax year after year because they can easily and successfully file their tax return. If you follow the directions provided and enter the numbers on your income forms correctly, you should end up with accurate taxes just as if you went to a more expensive professional tax preparer.

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