TurboTax vs. TaxAct 2024
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Competition is fierce among the biggest tax-prep software providers. TurboTax may be more widely recognized, but TaxAct is a strong competitor with its affordable tax help.
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FREE TIERS | |
$0 + $39.99 per state filed (Xpert Assist: $39.99). For dependents and simple filers who need help with college expenses, unemployment or retirement income. | $0 + $0 per state filed. It allows you to file a 1040 for free, but you can’t itemize or file Schedules 2 or 3. Roughly 37% of taxpayers are eligible. TurboTax Free Edition supports a simple Form 1040 and no schedules except for the earned income tax credit, child tax credit and student loan interest. |
PAID PACKAGES | |
Deluxe $49.99 + $59.99 per state filed (Xpert Assist: $39.99). This option is ideal for homeowners and those who need to consider childcare expenses, student loan payments, deductions, credits and adjustments. Premier $79.99 + $59.99 per state filed (Xpert Assist: $39.99). Premier is good for investors who need to report capital gains and losses and those who have sold a home or own a rental property. Self-Employed $99.99 + $59.99 per state filed (Xpert Assist: $39.99). This tier is good for freelancers, contractors and small-business owners. Includes access to Schedule C and Schedule F. Promotion: NerdWallet users get 25% off federal and state filing costs. | Live Assisted Basic $89 + $59 per state. Free edition, plus access to a tax pro, advice and a final review. TurboTax Live Assisted Basic supports Form 1040 and limited tax credits only; roughly 37% of taxpayers qualify. Deluxe $69 + $64 per state. Itemize and claim several tax deductions and credits. Works well for business income but no expenses. Premium $129 + $64 per state. Investment reporting and rental income (Schedules D and E, and K-1s), plus business income, expenses on a Schedule C, home office deductions and features for freelancers. Access to tax pro support requires upgrading to TurboTax's Live Assisted packages, which range from $89 to $219, plus state fees. Promotion: NerdWallet users can save up to an additional 10% on TurboTax. |
One note on prices: Providers frequently change them. You can verify the latest price by clicking through to each provider's site.
TurboTax vs. TaxAct: Features and ease of use
Only one entity determines how the math works on a tax return, and that’s the IRS. So unless there’s a programming error, you should get the same numerical “answer” no matter which tax software you use. But you still have to feed the software all of your information, and there are a million ways to do that. Which is why we look at features and ease of use — we want to know which offerings are least likely to make you want to pull your hair out.
TurboTax
TurboTax’s interface is like a chat with a tax preparer, and you can skip around if you need to. A banner running along the side keeps track of where you stand in the process and flags areas you still need to complete.
Embedded links throughout the process offer tips, explainers and other resources. And help buttons can connect you to the searchable knowledge base, on-screen help and more.
TaxAct
TaxAct has a similar look and feel, with an interview process guiding you along. You can skip around easily, and a banner running down the side keeps track of how far along you are.
Embedded links throughout offer tips, explainers and other resources, and the help center links to a searchable knowledge base.
Both TurboTax and TaxAct allow you to switch from a different software provider and offer tools to help you calculate the deduction value of donated items (though neither TurboTax nor TaxAct offer this at the free tier). TurboTax has an app, but TaxAct does not.
TurboTax vs. TaxAct: Support
TurboTax and TaxAct offer inline help and searchable knowledge bases, and tech support is available as well. Both providers also offer paid upgrades to packages that offer tax support from knowledgeable pros.
TurboTax
TurboTax Live offers a one-on-one review with a tax pro before you file as well as unlimited live tax advice. You can make an appointment or talk on the fly to a tax pro via one-way video (you see them, but they see your screen only).
TurboTax Live Full Service does away with tax software altogether. Instead, you upload your tax documents and a human puts together your tax return. Prices start at $129 for basic federal returns, but final pricing depends on complexity — plus there are additional costs per state return.
TaxAct
TaxAct offers affordable help through its Xpert Assist packages. Xpert Assist gets you unlimited screen-sharing access to a tax expert. You submit a question and then the right expert will reach out over the phone. Users can screen share to help the experts better understand their questions. TaxAct says its tax pros are CPAs, enrolled agents or other tax specialists. TaxAct also offers free reviews before you file.
Refunds, audits and other considerations
Both TurboTax and TaxAct let you receive a federal refund via direct deposit to a bank account — that’s the fastest option. Other options both offer include getting an old-fashioned paper check, applying the refund to next year’s taxes or directing the IRS to buy U.S. Savings Bonds with your refund.
Both providers offer an option to have your refund loaded onto a prepaid card. (These cards may come with fees, so be sure to factor that into your decision.) And both let you use your refund to pay for your tax-prep fees (but there is a separate fee for that, too).
If you are audited, it’s important to know what kind of support you’re getting from your tax software. First, be sure you know the difference between “support” and “defense.” With most providers, audit support (or “assistance”) typically means guidance about what to expect and how to prepare — that’s it. Audit defense, on the other hand, gets you full representation before the IRS from a tax professional.
TurboTax gives everyone free audit support from a tax pro to help you understand what’s going on if you get that dreaded letter about your tax return. If you want audit defense, that’s included with TurboTax Live Full Service for an additional $49.
TaxAct partners with ProtectionPlus to offer its clients free, full-service audit assistance, but audit defense costs $49.95.
TurboTax vs. TaxAct: Which one is right for you?
TurboTax may reign supreme when it comes to tools and integrations, but that doesn’t mean the provider’s overall offerings are the perfect fit for every user.
TaxAct’s paid packages cost less, and they come with affordable upgrades for human tax help support if you need it. This makes TaxAct a great one-stop shop for both seasoned and beginner filers who might feel at ease knowing that help is available should they need it.
TurboTax, on the other hand, has a long-standing reputation for its ease of use, including a well-reviewed mobile app and plenty of its own human support options at a cost. This may make the provider a better choice for those who are willing to pay a little bit extra for white-glove tax prep.
How do TurboTax and TaxAct compare with other providers?
Promotion: NerdWallet users get 25% off federal and state filing costs. | |
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Promotion: NerdWallet users can save up to an additional 10% on TurboTax. | |
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