In this article, we will be taking an in-depth look at TurboTax, the features that this software has to offer, as well as the different plans and their application ranges. We will also consider some benefits and drawbacks.
How Does TurboTax Work?
Like most other tax software solutions, TurboTax uses an interface that takes you through a step-by-step process to prepare your return. The interface follows an interview approach and asks you to fill out all the information that it needs.
The interface has a modern and user-friendly design, and you can use it prepare and file both state and federal tax returns. The software will provide you with sufficient information throughout the process without cluttering your screen with text.
When you fill out your information to prepare your tax return, you can let the software guide you through the process in the correct order, or if you have enough confidence with tax filing, you can explore the different sections on your own.
Based on the personal and tax information that you provide, the software will assign you a filing status and may recommend that you upgrade to one of TurboTax’s upgraded plans if it is more suitable to your tax situation. After entering all your information, the software will do a walkthrough so that you can make sure that you entered your information correctly without leaving anything out.
If you’ve used TurboTax before, you can import information from the previous years’ returns, and you can import data from your W-2 or 1099 forms to save time and add detail correctly. Since the software is intuitive and straightforward, you can use it to file your returns, even if you have no prior experience with tax filing or this type of software.
Online Support and Tax Tools
Even experienced tax filers may, at times, encounter tax problems or technical difficulties. You may also want to do a quick calculation without having to open a new tab. TurboTax offers a wide range of tools and extensive online help to their clients.
To help you understand the tax filing process, there is a comprehensive library that consists of, among other things, tax tips and videos. Other tools include a TaxCaster calculator, a W-4 Withholding calculator, and a Tax Bracket Calculator.
If you are subscribed to the Deluxe, Premier, or Self-Employed versions, you can upgrade your plan with TurboTax Live. If you add a version of TurboTax live, you gain access to a tax expert that will review your taxes, help you understand the process, and help you file your taxes correctly.
Tax Audit Services
TurboTax offers an Audit Support Guarantee that you can use if the IRS wants to audit you. This audit assistance includes audit support for the tax year. As part of this service, you will receive in-person guidance, answers to your questions, and assistance in preparing for your audit.
Refund and Payment Options
You can pay for TurboTax’s tax filing services with one of several methods: a portion of your tax refund or your debit, credit, or prepaid card.
You can also receive your tax refund a number of ways, depending on how urgently you want your refund, which manner is the most convenient for you, and the banking fees involved. You can have the refund deposited directly into your checking, savings, brokerage, or IRA account, or you can receive it as a check.
When the IRS notifies you that they have accepted your tax return, it can take up to 21 days for you to receive your refund. Direct deposit typically doesn’t take as long as a check.
TurboTax’s software is online, so you can access your account from any device and at any location. If you are working from a computer, you can access your tax documents through the website, and if you are using your phone or a tablet, you can download and use the TurboTax app.
Easy Form Import
Manually keying information relating to your details, taxes, and income can be frustrating and time-consuming. TurboTax’s software allows you to import the data on your W-2 and 1099 form directly from competitor or employer platforms. If your forms are printed on paper, you can take a picture of the form you want to import and upload it to your account. By doing this, you will transfer all the data on the form to your return.
A handy feature of TurboTax is the progress banner that runs across the top of your screen. This banner will also flag sections that are incomplete to ensure that you fill in all the information.
TurboTax offers four different versions that clients can choose from. It is not essential that you immediately understand which plan is more suitable for your needs. You can start with the more affordable plans, and the software will recommend an upgrade if necessary.
The Free plan supports basic tax filing and allows users to file both federal and state taxes for free. If you receive W-2, 1099-DIV, or 1099-INT income, you are eligible for the Free version.
To use this version, you may also have child tax credits, and you may take the Earned Income Tax Credit (EITC).
Deluxe – $39.99
Most TurboTax clients select the Deluxe plan, as it allows for Schedule A, C, and C-EZ filing. As a result, this version supports tax filing for mortgage and property tax deductions as well as itemized deductions.
People who are self-employed and have basic income and expenses can also use the Deluxe version.
Premier – $59.99
With the Premier version, you receive all the filing support included under the Free and Deluxe versions as well as support for Schedules D and E, which allows for reporting of income from stocks, bonds, and ESPPs.
Landlords can also report rental property income and expenses with this version.
Self-Employed – $89.99
The Self-Employed version is the most expensive that TurboTax has to offer and provides self-employed tax filers with the ability to report their business’s income and expenses as well as asset depreciation.
The Student version of TurboTax comes with a focus on deductions and tax credits available to students. They even have the Sprintax team, which is focused on international students and how they file taxes.
There is no specific cost to student access. The price will be determined by which of the above versions best meets your needs.
With more and more people filing taxes online, there has been an increasing number of alternatives to TurboTax. These companies include:
- H&R Block – You cannot look at tax services without H&R Block coming up. They are TurboTax’s number one alternative.
- TaxAct – One of the oldest tax software packages, Tax Act offers a complete tax solution.
- Tax Slayer – Offering tax software since 1993, Tax Slayer has a company history that extends more than five decades.
- Several high-quality options to choose from to meet your needs
- Comprehensive customer support and online tools
- Access to live assistance from tax professionals
- User-friendly and intuitive interface
- Easy importing of forms
- Prices of paid plans are relatively high
- The free version may not provide enough features
TurboTax Review Final Thoughts
TurboTax is one of the most popular names in tax software for a reason – it sets the standard in terms of comprehensiveness, user-friendliness, and customer support.
Of course, that also means it can set its prices high, and it does. Consider whether you’ll use all the features on offer before signing up for a costly package.