Best Tax Software and Services
Tax Software Contributing Editor
Updated on 01/08/2018
The tax software industry has experienced exponential growth over the past 15 years. What started out with a handful of programs has grown to dozens of companies providing software, online and mobile-based tax preparation and filing services for individuals and businesses.
Tax software lets consumers do their taxes without the help of a professional or lets them complete most of the paperwork and then speak to a tax professional to have any questions answered. Tax preparation companies take all the work out of taxes.
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Compare Reviews for Top Tax Software and Services
|Community Tax||Read 380 Reviews|
Community Tax is a reliable company dedicated to tax relief and resolution services for consumers. Based in Chicago, IL, the company also helps clients with tax preparation and book keeping services to its customers.
|Intuit - TurboTax||Read 2400 Reviews|
Intuit TurboTax is a company that has created software solutions for tax completion and filing. TurboTax was developed in the mid-1980s by a San Diego-based company called Chipsoft, which was ultimately acquired by Intuit.
|Tax Group Center||Read 69 Reviews|
Tax Group Center is a California-based tax service. It works primarily with individuals and businesses who are experiencing tax problems with the IRS or their state tax authority, and offers 24/7 services and free consultations.
|H&R Block||Read 2511 Reviews|
H&R Block is one of the country's leading tax preparation service companies. The company offers in-person tax preparation or online tax preparation, and its corporate headquarters is located in Kansas City, MO.
|TaxACT||Read 590 Reviews|
TaxACT is a company that allows customers to complete, file, and print their taxes for free via the Internet. With its headquarters in Cedar Rapids, Iowa, the company is a subsidiary of Blucora Internet services.
|Jackson Hewitt||Read 1156 Reviews|
Jackson Hewitt is a large tax preparation company with more than 6,300 locations across the United States. The company offers customers help in filing their taxes via a Jackson Hewitt franchise or easily online.
|Liberty Tax Service||Read 358 Reviews|
Founded in 1997, Liberty Tax Service offers reliable tax services to clients in both the United States and Canada. The company is headquartered in Virginia Beach, VA, and has franchise locations across the country.
|Taxslayer.com||Read 120 Reviews|
TaxSlayer is a company with a range of products to help customers e-file their taxes. Based in Evans, GA, Taxslayer has several different product options for customers to choose from -- Basic, Classic, Premium, Military, and more.
|TaxAudit.com||Read 51 Reviews|
TaxAudit.com is a company that was originally created by TaxResources, Inc. This company provides its customers with tax audit representation and taxpayer education so that they don't have to deal with the IRS on their own.
|eSmart Tax||Read 47 Reviews|
eSmart Tax provides its customers with helpful and reliable online tax preparation services for both federal and state taxes. This company is the online division of the larger tax services company, Liberty Tax.
Important features for tax services and tax software
The most important feature of any tax software program is accuracy. An inaccurate tax return could cost a taxpayer hundreds or even thousands of dollars. Both errors in favor of the taxpayer and in favor of the IRS can be costly.
- Error check: Most tax software programs run an error check prior to filing the tax return.
- Accuracy guarantee: Companies typically offer an accuracy guarantee, which ensures that the calculations the program completes are accurate. The guarantee doesn’t cover human mistakes, though, so it is important that taxpayers verify all of the data entered into the system.
- Professional review: Some programs allow taxpayers to pay an additional fee to have their return reviewed by a tax professional.
Ease of use
No matter how accurate and well priced a tax software program is, if it isn't easy-to-use then customers will take their business elsewhere. Tax time is stressful for many taxpayers and the last thing anyone wants is the challenges of a difficult to use program.
- Online programs: Web-based software programs eliminate the need for a local software installation, which reduces compatibility problems.
- Interviews: The most popular tax software programs use an interview approach to gathering tax data; this makes tax preparation a simple and hassle-free process.
- Table of contents: In addition to the interview approach, many of the more popular programs allow taxpayers to pick and choose specific forms. This is a great feature for more experienced users.
Data security is of the utmost importance. Hackers, unscrupulous employees, fires and floods are just a few of the ways that your data could be compromised or lost.
- Data security software: A completed tax return has everything an identity thief needs to set up financial accounts in your name. Tax software companies need to utilize the latest in security software and post a security policy online.
- Account disclosures: Tax software companies should disclose what happens to your credit card or bank account information when your return is complete. Is the data stored for future use or removed from the system?
- Disaster recovery plan: Companies should also have an adequate disaster recovery plan in place because a fire or natural disaster could destroy your data. Taxpayers that failed to make a personal backup won’t have access to important financial records.
Help and support
Tax software, at its core, is a do-it-yourself project. There is a reason that taxpayers, by the millions, opt for software programs over an accountant – they like the DIY aspect. However, people do run into problems and a solid help and support system is an integral part of any tax software package.
- Live chat support: Companies can provide longer support hours by utilizing a live chat support service.
- Phone support: Even web-based programs need to have a phone support option because there are some problems that can’t be solved efficiently using text-based interactions.
- Knowledge base: Most DIY taxpayers would rather research their problems than wait for a customer service response, which makes a comprehensive knowledge base a valuable resource.
Tax refund options
Gone are the days of waiting months for a check from the IRS to arrive in your mailbox. While taxpayers can still opt to receive a paper check, the IRS and most tax software programs offer direct deposit and other refund options like U.S. Savings Bonds, prepaid debit cards and more.
- Direct deposit: All of the major tax software providers offer customers a direct deposit option.
- Paper checks: The IRS and software companies still offer paper checks to taxpayers expecting a refund.
- Prepaid debit cards: A prepaid debit card loaded with the refund is a great option for taxpayers without a bank account.
A tax software program that offers multiple filing options is preferred. While online filing is a popular choice, not every taxpayer has access to the Internet or wants to submit sensitive data electronically. A program that offers both online and print and mail options leaves this decision up to the customer.
- Online: All of the popular tax software programs allow online tax filing, in addition to tax preparation services.
- Print and mail: Some programs allow taxpayers to print and mail a copy of their returns.
- Online and print: The best option is to file your return electronically and then print a copy for personal records.
Types of tax software
An online tax software program is entirely web-based. The program shouldn’t require any downloading, aside from a plugin or two. Most online programs store historical tax return data and allow users to download a copy for personal records.
Unlike online programs, a package that is downloaded or purchased at a local computer store involves a local software installation. Returns can often be prepared without an Internet connection, although connectivity will be required for product updates and electronic filing.
The rise in popularity of smartphones and tablets has opened up a new segment of tax software – mobile applications. Some tax programs allow a return to be prepared and filed entirely through a mobile app, while other companies use apps to supplement an online program.
Even tax professionals use software to complete tax returns. There are a variety of products marketed specifically to tax professionals but the vast majority of individual filers will never need to research or use these products.
People who can use tax software
Individual or basic filer
A taxpayer that qualifies for the 1040EZ, which includes married couples without children or deductions as well as middle-class individuals, can often file their taxes for free. Most of the popular tax software programs offer a basic free file for federal 1040EZ returns.
Families or high-income individuals
Married couples with children, individuals that earn more than $100,000 per year and other taxpayers that have to use a 1040A or 1040 need a more comprehensive tax software program.
Most sole proprietors file their taxes as part of an individual return, however not all tax software programs have the necessary forms to complete this type of return. Companies that offer enhanced individual or small business packages are a good choice for sole proprietors.
Small business owners
Small business owners have more advanced tax needs than sole proprietors and need a package that can fit their needs. A few of the major tax software programs offer packages for S-Corps, C-Corps and other small business entities.
Taxpayers with special situations
Not every taxpayer files a simple and straightforward return. Taxpayers in special tax situations, including those with rentals, individuals that need to file back taxes or those with foreign income need to find a software program that can meet their varied needs.
Expert reviews for tax software
TurboTax is one of Intuit's many financial services products. Intuit, which was founded in 1983, has kept TurboTax at the top of the tax software industry. In 2013, more than 26 million taxpayers across the nation used a TurboTax service.
TaxACT launched in 1998 and has grown to become the second most popular tax software program available. For the past seven years, TaxACT has maintained its number two spot, providing tax preparation and filing services to more than 38 million customers.
TaxSlayer started out in 1992 as a software package for tax professionals. In 1998, the company created a basic online version for individual taxpayer use. Today, the TaxSlayer program is a full-featured product that can compete with industry leaders.
H&R Block has prepared and filed more than 600 million tax returns since 1955 and although the online version is a more modern incarnation of this service, taxpayers can have peace of mind knowing that they are working with one of the most experienced tax service providers in the nation. In 2012, the company processed more than 25.6 million tax returns including 20 percent of the returns filed by low-income taxpayers that claimed the Earned Income Tax Credit.
Jackson Hewitt started out as an in-person only tax service provider, but in 2010 the company expanded with the launch of Jackson Hewitt Online. The online tax software service is aimed at those taxpayers that are comfortable preparing and filing taxes themselves, which introduced the Jackson Hewitt brand to a new market.
eSmart Tax is the online version of Liberty Tax Service's popular in-person offerings. As part of Liberty Tax Service, eSmart Tax provides several guarantees to customers including satisfaction, accuracy, biggest refunds and a lock-in guarantee. The lock-in guarantee ensures that you pay the fee you agreed to when signing up for the service, regardless of what the price is when you file your return.
In 2010, TaxSimple was acquired by Thomson Reuters, which added a personal tax solution to the company’s existing suite of tax services. TaxSimple owner and co-founder John Vora remained on staff but the acquisition enabled TaxSimple to improve its product.
- Data-rich website: The TaxSimple.com website provides a comprehensive list of the IRS forms supported by each software version. If a taxpayer knows the form she needs to file, she can instantly see which package she needs to purchase.
- Guarantees: TaxSimple offers a maximum refund guarantee. If you use another software program and find out you were entitled to a larger refund, TaxSimple will refund your money.
- Upgraded interface: The application now uses Microsoft Silverlight, which is better than the previous version that often caused user’s computers to crash.
- Support hours: TaxSimple has limited live chat support hours.
- Support: There is no phone support option available, which makes live chat the only interactive support available to customers experiencing problems with TaxSimple.com’s software.
- Best for: Individual and Basic Filers, Families and High Income Individuals
The expert grade assigned to each of these tax software programs is based on several criteria including product features, price and consumer reputation.Are you an expert?
Information in this guide is general in nature and is intended for informational purposes only; it is not legal, health, investment or tax advice. ConsumerAffairs.com makes no representation as to the accuracy of the information provided and assumes no liability for any damages or loss arising from its use.
Compare Reviews for Top Tax Software and Services
|Free1040TaxReturn.com||Read 17 Reviews|
Free1040TaxReturn.com offers its customers safe and secure, simple tax completion and filing services for convenience. The company offers an easy filing process, and currently serves customers in 21 U.S. states.
|Power Tax Relief||Read 30 Reviews|
Power Tax Relief is a company that specializes in tax resolution for customers who need help in filing their taxes. The company handles a range of situations, from IRS Liens, late tax returns, wage garnishment, and more.
|Expresstaxrefund.com||Read 59 Reviews|
Expresstaxrefund.com is a company that is authorized by the IRS and provides reliable tax filing services for its customers. Their core focus is on getting customers their tax refund quickly, easily, and securely.
|TaxSimple||Read Expert Review|
TaxSimple offers customers simple online tax software for help with federal and state taxes. The company has been in business for over 30 years, and they offer three levels of service to help with tax completion.