TurboTax is a widely acclaimed tax preparation solution, but is it the ideal choice for your unique circumstances?

Overview

1. TurboTax

Our Rating: 4.5/5 stars

Analysis: TurboTax distinguishes itself particularly well when catering to customers with intricate tax returns. Its Deluxe variant adeptly optimizes tax deductions and credits, while the Premium package encompasses investments, such as cryptocurrency and stock transactions, alongside rental properties. Moreover, TurboTax streamlines the process by facilitating the automatic importation of investment income.

2. Tax Filing Solutions Catering to Every Scenario

Navigating the maze of tax preparation services can prove daunting. Amidst this, TurboTax® emerges as a frontrunner worthy of thorough exploration. As a cornerstone of Intuit®’s suite of offerings, TurboTax ranks among the most sought-after tax preparation software solutions. However, while size often implies superiority, it’s prudent to meticulously evaluate alternatives to pinpoint the perfect match for your requirements.

Benefits:

• Tailored products accommodating diverse tax situations, spanning from straightforward to intricate

• Inclusion of investments and rental properties within TurboTax Premium

• Comprehensive scrutiny of your return to mitigate oversights

Drawbacks:

• Certain products command a higher price tag compared to competitors

• Pricing details for specific packages may require deeper investigation

TurboTax in Brief

1. Price:

• TurboTax Free Edition: Complimentary federal filing (Approximately 37% of taxpayers meet the criteria for TurboTax Free Edition, which covers Form 1040 and select credits)

• TurboTax Free Edition State: Gratis state filing (Around 37% of taxpayers qualify for TurboTax Free Edition, allowing them to file their state returns at no cost when using Form 1040 and limited credits)

• Deluxe: $69 for federal return + $64 per state return

• Premium: $129 for federal return + $64 per state return

2. Guarantees Offered:

• Accuracy Assurance

• Maximum Refund Pledge

• Audit Assistance Guarantee

• Customer Satisfaction Guarantee

• Options for Expert Endorsement Guarantees

3. Import Capabilities for W-2 and Prior Year Data: Yes

• Audit Support Services:

4. Complimentary Audit Support:

• Free audit assistance

• Comprehensive support available for a fee

5. Access to Tax Professionals:

• Available, for an additional charge

Tax Filing Solutions and Associated Costs

When it comes to preparing and submitting your tax returns, there are several options available, each tailored to cater to specific needs and circumstances. The pricing structure varies across these offerings, reflecting the level of complexity and the range of services provided. It’s important to note that the fees mentioned here are subject to change.

1. Turbo Tax Free Edition: $0 Federal, $0 State

The TurboTax Free Edition (Disclaimer: Approximately 37% of taxpayers meet the criteria for the TurboTax Free Edition. This edition is solely for Form 1040 and a limited selection of credits) is accessible to taxpayers who solely require filing Form 1040 without any supplementary forms or schedules. It encompasses the following, contingent upon the absence of additional complexities:

• Earnings reported via W-2 forms

• Modest interest and dividend income documented on 1099-INT or 1099-DIV forms

• Income from hobbies, personal property rentals, or sales of personal items reported on Form 1099-K

• Utilization of the standard deduction as prescribed by the Internal Revenue Service (IRS)

• Eligibility for the Earned Income Tax Credit

• Applicability of child tax credits

• Deduction for interest paid on student loans

However, if your tax scenario involves itemizing deductions, business ownership, rental property, investment sales, or other complexities, this option may not suit your needs.

Eligible users can import their W-2 and navigate through a brief series of questions to complete the filing process. For those with employers partnered with TurboTax Import, importing merely involves entering their EIN. Alternatively, users can easily import documents by capturing photos via the TurboTax mobile app.

Returning users benefit from pre-populated information, facilitating a seamless transition. Moreover, those migrating from other services may potentially upload a PDF of their previous return for a similar streamlined experience, contingent on the previous service provider.

2. TurboTax Deluxe: $69 Federal, $64 State

TurboTax Deluxe caters to individuals with more intricate tax scenarios beyond the scope of TurboTax’s free tier. Alongside features offered in the free tier, TurboTax Deluxe delves deeper, scouring over 350 tax deductions and credits. These encompass:

• Mortgage and property tax payments

• Charitable contributions

• Educational expenses

• Tax credits applicable to dependents

Furthermore, you’ll gain access to personalized one-on-one assistance, delivered through either telephone or online channels.

3. TurboTax Premium: $129 Federal, $64 State

TurboTax has consolidated its previous Premier and Self-Employed packages into a single Premium tier, streamlining its offerings beyond the Deluxe level. This move aims to provide a more affordable solution for freelancers and self-employed individuals, although investors who previously utilized the Premier package may find themselves incurring higher costs, especially if they fail to capitalize on early-season discounts.

3.1 Investor Features

Although the names of the packages may have been updated, the core features remain consistent. Under this tier, investors can avail themselves of:

• Access to a diverse range of investments including stocks, bonds, employee stock purchase plans, and cryptocurrency.

• Management of rental property income alongside associated tax deductions.

Automated import functionality ensures seamless tracking of cryptocurrency and stock activities, minimizing the risk of oversight. Moreover, the service meticulously calculates gains and losses stemming from cryptocurrency transactions, a task often intricate when dealing with crypto exchanges.

3.2 Features for Small Business Owners and Freelancers

TurboTax Premium caters to the needs of freelancers, contractors, and small business proprietors with a comprehensive array of features, including:

• A thorough exploration of 500 tax deductions and credits.

• Seamless importing capabilities from Quickbooks® Self-Employed, Uber, Lyft, and Uber Eats.

• Hassle-free uploading and autofilling of 1099-K and 1099-NEC forms.

• Precise calculations for asset depreciation.

• Tailored guidance on industry-specific deductions.

• Assistance with home office expense deductions.

• Unlimited access to W-2 and 1099 forms for both employees and contractors.

• Personalized assessment of audit risk.

• Year-over-year comparison of self-employed income and expenses, facilitating informed business decisions.

Features

TurboTax offers a comprehensive suite of features designed to streamline the tax preparation and filing process, providing users with peace of mind. Across most of its tiers, TurboTax includes the following standard features:

1. Access to an online community of tax specialists and fellow users for support and guidance.

2. Import functionality for last year’s tax return, including from other tax preparation services.

3. Tax calculators to assist with estimating tax liabilities and potential refunds.

4. Up-to-date information on the latest tax law changes and regulations.

Additionally, TurboTax provides the following features, with the specific benefits varying based on the tier you choose:

1. Maximum Refund Assurance: TurboTax commits to thoroughly examining all eligible deductions and credits to maximize your refund based on the tier you select.

2. 100% Accurate Calculations Guarantee: In the event the IRS identifies a calculation error attributable to TurboTax, the company will cover any resulting penalties.

3. Audit Support: If the IRS initiates an audit based on your TurboTax individual, TurboTax Live Assisted Business, or TurboTax Full Service Business return, the company will provide one-on-one, question-and-answer support from their professionals. However, this does not extend to legal representation or advice.

Refund Options

For those eligible for a tax refund, TurboTax offers flexibility in receiving the funds, either via check or direct deposit. Simply indicate your preference, along with providing necessary bank account details if opting for direct deposit.

TurboTax extends the option of advancing up to 50% of qualifying users’ refunds, capped at $4,000. This advance comes devoid of fees, interest, or any impact on credit scores. Availing this feature necessitates opening a Credit Karma Money™ Spend checking account, where TurboTax swiftly deposits the funds, often within four minutes of the IRS accepting your return. It’s essential to note that for eligibility, your Federal refund must amount to at least $500.

Mobile Application

For handling your tax affairs, you have the option to either fill out your tax details and submit your return online, or alternatively, you can opt for TurboTax’s mobile application. This versatile app is compatible with both iOS and Android devices, offering you the convenience of completing the entire process seamlessly. Through the app, you can import relevant information effortlessly or capture images, swiftly uploading them to your tax return.

Moreover, should you encounter any queries along the way, the app provides access to a live chat feature, allowing instant assistance. Alternatively, you can engage in real-time conversations with TurboTax’s knowledgeable tax professionals for personalized guidance.

TurboTax Assistance

In addition to its mobile app, TurboTax extends robust support through its dedicated support page. Here, users can access a trove of invaluable resources and guidance. Furthermore, joining the TurboTax community enables you to participate in discussions on tax-related topics, gaining insights from both experts and fellow users alike.

Should you require direct assistance with TurboTax, simply dial 1-800-446-8848 to leave a message for the TurboTax support team, ensuring prompt attention to your queries or concerns.

Security Measures of TurboTax

TurboTax prioritizes the security of your sensitive tax information through stringent measures. Utilizing two-factor authentication and Touch ID® features, TurboTax ensures that only authorized individuals can access your data. Additionally, the company employs SSL data encryption protocols, surpassing the IRS’s minimum requirements for safeguarding information during storage and transmission to IRS and state agencies.

For added peace of mind, TurboTax enables you to monitor login activity and receive notifications for any modifications made to your account, enhancing transparency and security.

Audits and TurboTax: What You Need to Know

When facing an audit, TurboTax extends basic support to address inquiries regarding your tax return. However, this assistance does not encompass representation or legal counsel.

For comprehensive audit representation and identity protection, TurboTax offers a premium service called TurboTax MAX, albeit at an additional expense. It’s crucial to note that this service is preemptive, thus not available once you’ve received an audit notice. In such a scenario, you can still seek representation, with fees determined by your circumstances.

The Concluding Perspective

In essence, TurboTax provides a range of services and features catering to most taxpayers, presenting competitive advantages compared to other online tax preparation platforms. If you’ve found TurboTax reliable in the past, sticking with the service might be convenient.

Nonetheless, it’s worth mentioning that certain TurboTax tiers are comparatively pricier than counterparts offered by competing services. Exploring and comparing various options, including online tax preparation platforms and professional tax assistance, is recommended to find the most suitable solution for your needs.