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Friday, April 30, 2021

Is TurboTax Your Reliable Tax Return Software?

The idea behind TurboTax was proposed by Michael A. Chipman who was the then chairman of the IT consultation and solutions company called Chipsoft. TurboTax was finally developed in 1984 and was sold to the famous American financial software company called Intuit in 1993. If you regularly file your taxes, you surely have come across the name ‘TurboTax’.

It is a computerized software package for preparing income tax returns in America and Canada. In its specific product segment, TurboTax leads the market and gives companies like TaxAct and H&R Block Tax Software fair competition. In this article, we are going to discuss the software, and also talk about the general TurboTax reviews

More About Turbotax

H&R Block Tax Software fair competitionLike in most of the other first-world wealthy countries, in America and Canada, there exists an online system of filing taxes which is owned by Intuit. inc, the maker of TurboTax. Though TurboTax is not the cheapest option available, if you are looking for a smooth user-friendly interface for handling, processing, and filing tax returns electronically then TurboTax might come off as a suitable option for you or (and) your business(es). 

Before going into how much is TurboTax and other detailed statistics, let us find out some more general information regarding the software. 

  • Accuracy is a must for any computer software, and without any doubt, TurboTax follows suit and brings in various updates to maintain accuracy when it comes to tax form revisions.
  • The software manages and processes tax returns but that is not only it. The company also offers a guarantee on maximum returns, but that is available only for the paid users and customers. 
  • Calculations that are conducted over the software are guaranteed 100% accuracy, and this is applicable for any version of TurboTax.
  • In Canada, TurboTax has CRA certification for NETFILE, while in the US, TurboTax has partnered with IRS in the Free File Alliance, so that it can provide free e-files throughout the country. 
  • TurboTax also has an available option of Audit defense where customers can appoint an expert to defend their returns. 
  • All the free and paid versions of TurboTax are available on operating software by Windows, Android, and Mac. It can also be installed in the form of an application for tablets, smartphones, and iPads. 

Costing of TurboTax

TurboTax reviewsComing to discuss the costing of TurboTax, just hovering your eyes over a few of its highlights indicate that TurboTax could be one of the most popular tax service providers but it certainly is not the cheapest of them all. The software offers three DIY packages that can cost you between $60 and $120 when it comes to federal returns and an extra $50 for state returns.

Different people have different tax situations. But to understand clearly, in a nutshell, the more the level of your complexities increases in your situation, the more expensive it will become, to handle the documents. The cost also has a chance of further rising, if you enroll for a one-to-one consultation from an expert. 

Cost Dependency

The cost of TurboTax depends upon how you want to prepare and file your taxes. There are three major ways through which you can file your tax returns. They are as follows:

  1. Do it yourself online packages
  2. TurboTax Live, and
  3. Downloadable computer software. 

Now, each of these categories has different prices and it also depends on what kind of tax forms you need and also whether you need any special help to get rid of a complex situation or not and so on. You might not choose to pay anything and make maximum use of their free version and the fees can rise to as much as $345.

The cheapest is the DIY packages, since there you are doing everything yourself, starting from arranging all the papers to filling out every form. There is a cut-off for the free version that is determined by your annual income. If you are not eligible to use the free version, then these would cost you around $60, $90, or $120, without considering on-site discounts. 

How Much Is Turbotax Deluxe? – A General Question In People’s Minds

how much is TurboTaxIf it is Federal tax returns, then Deluxe costs you $60. If you choose the live version under Federal returns, then the cost goes up to $120. Similarly, State returns will cost you $50 and it will go up to $55 with the live feature. Now, what exactly does Deluxe do for you? This version allows you to itemize and claim many other tax credits and tax deductions.

This might just seem to be a good option for you if you have an income from a business but no expenses as such. However, you would not be able to report capital gains or rental income (Schedule D and Schedule E) through this particular version. So, going by reviews, TurboTax Deluxe costs you a bit more than other plans, but it certainly does its job fine. 

TurboTax Free vs Deluxe 

The previous discussion can spur a want to know whether it is economical and better to opt for the free version than going for deluxe and spending quite some money on your tax papers. However, it is important to note that the free version is for the simplest of tax returns only. It is not devised to carry out complex calculations and not only that! A lot of features are unavailable when it comes to the free version.

Getting into more details, though it allows you to file a 1040 and also a state tax return for free, unlike Deluxe, you cannot itemize or file schedule 1 – schedule 3 of that 1040. Usually, the free version works only for those who don’t plan to claim deductions or credits, with exceptions to the standard deduction, child tax credit, or earned income tax credit.

TaxActHence, according to the TurboTax reviewers, you might want to use the free version for filing some very basic tax returns but if you are looking for customer satisfaction, then TurboTax Free is not the right option. 

Turbotax Self-Employed Cost And Features 

The Deluxe plan surely offers a more extensive set of features that are viable for, say, a big business. But if you are into a small-scale business, freelancer, or even a contractor, you might want to try out the self-employed version. This version gives you all the required features to file an accurate return for your small business. However, the cost for Self-employed is a bit more and touches $119.99 for Federal returns, $199.99 for the live version, and $44.99 for State tax returns. It provides numerous features, some of which are mentioned below:

  • Unlimited employee tax forms
  • Schedule C preparation 
  • Take advantage of deductions
  • Integration with QuickBooks Self-Employed
  • Rental management features. 

Along with all these features and qualities, TurboTax is also undergoing investigation by various State bodies in connection to a couple of complaints. It is often said that the free version of TurboTax is deliberately often hidden from users so that they can purchase better plans. Along with that, it is also heard that TurboTax had previously tricked the Military service members in making them pay an amount as a result of a scam concerning a particular ‘military discount’.

financial software companyHowever, if you are in the States or Canada and can spend a fair amount of money that will look after your tax returns in a hassle-free manner, then you can give it a try and invest in TurboTax and make dealing with tax returns easier. However, like any computer software, you just have to be a bit cautious of malware and hackers

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Daniyel Carlson
Daniyel Carlson is a Young Researcher in the field of Data Science & Analytics having research experience of more than 8 years. He has a Masters in Computer Engineering and currently serves as an Editorial Assistant in IGI Global, United States of America. Daniyel also holds honorary positions in the Associate Member of Institute of Research Engineers and Doctors, International Association of Computer Science and Information Technology, International Association of Engineers, Society of Digital Information and Wireless Communications.

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