TaxAct vs TurboTax

The tax season is inescapable, but you can make the filing process easier. When considering tax software solutions, TaxAct vs TurboTax often come into the equation. Both companies can walk you through the tax preparation process step by step. But which one is better?

We will give you a side-by-side comparison for you to decide.

Side-by-Side Comparison

Note: The prices and features reviewed in this post are for the online do-it-yourself products of TaxAct and TurboTax. Both companies offer downloadable versions of their software at different prices.

TurboTax vs TaxAct: Free Edition

TaxAct and TurboTax offer free plans for simple tax returns. They both cover:

• W-2 income
• Unemployment income
• Retirement distributions
• Interest and dividend income
• Earned income tax credit
• Child tax credit

The most significant TurboTax Free vs TaxAct Free difference is the price for state returns. While TaxAct charges $39.95 per state, TurboTax includes one state tax return for free.

Both companies’ free tax filing services have no income limits but handle only simple tax situations. For anything more complex, you need to upgrade to a higher tier.

Deluxe

The most popular plan for both companies is the Deluxe. With TaxAct, this package costs $46.95 plus an additional $54.95 per state, and it accommodates homeowners, people with child expenses, and those paying off student loans.

The Deluxe edition of TurboTax works well in the same tax situations but costs $59 plus $49 per state. The company further pledges to search for 350+ tax deductions and credits to find every tax break you qualify for.

Premier

This program is for more complex tax situations such as active investing and rental property ownership.

TaxTurbo’s Premier plan costs $89 for federal do-it-yourself tax preparation and $49 per state return. Meanwhile, TaxAct’s Premier program price is $69.95 for federal preparation and $54.95 per state return.

Self-employed

The Self-employed plans of TaxAct and TaxTurbo are appropriate for small business owners, independent contractors and freelancers.

Here again, TaxAct is cheaper than TurboTax. TaxAct’s Self-employed program costs $94.95 for federal prep and filing and $54.95 per state return. TurboTax charges $119 for do-it-yourself tax prep and $49 for a state return.

TaxAct or TurboTax: Which Is Easier to Use?

TurboTax has a highly interactive experience. The interface is like a chat with a tax preparer. There is also a banner running along the side and tracks where you stand in the process.

One of the biggest benefits of TurboTax is that the software walks you through a wide range of possible income and deductions and marks areas that you haven’t completed yet, so you don’t miss anything. On the left corner of the site, you will find the help and live tax advice button in case you are stuck and have questions.

TaxAct is also user-friendly and includes a straightforward path through the tax preparation process. Same as TurboTax, a banner keeps track of where you stand. Both TurboTax and Taxact have embedded links throughout the process that offer trips, explainers, and other resources. A help centre will also help you if you have questions during the process.

However, if you prefer more guidance through the tax preparation process, you may find TurboTax easier to use.

TurboTax versus TaxAct: Mobile app

Both TurboTax and TaxAct have a mobile app so you can prepare and file your taxes from your smartphone.

The Turbotax mobile app is available for both Android and iOS. The company offers the same tax topics as on the browser-based version. The homepage displays the site’s main content so you can easily navigate it. Internal information and data entry screens are also easy to use and understand. An icon at the bottom of the screen takes you to the area where you can upload your tax documents.

TaxAct’s mobile app, TaxAct Express, is also available for Android and iOS. When you are using the help center of the app, some screens may be slow to open. If you haven’t finished tax filing on the desktop version, you can complete it using TaxAct Express.

According to the customer reviews on Google Play and App Store, both TurboTax’s and TaxAct’s mobile apps have high customer ratings.

TaxAct vs TurboTax: Which Service Provides a Bigger Refund?

Both TaxAct and TurboTax guarantee accurate calculations and maximum tax returns. If another company can get you a larger tax refund, TaxAct and TurboTax will return the money you paid for the software plan used for the filing.

The companies let you receive a federal tax return via direct deposit to a bank account. If you want through an old-fashioned way, you can also receive your refund with a paper check or apply the refund to next year’s taxes.

Support and Resources

Both TurboTax and Taxct offer inline help and tech support. But let’s look at the various ways you can find answers and get pro guidance when filing your return with TurboTax or TaxAct.

If you are stuck while filing your taxes, or you just want to get expert advice as you do your taxes, TurboTax offers two ways to file with tax experts – TurboTax Live and TurboTax Live Full Service.

If you choose TurboTax Live, you need to answer simple questions about your work and family, so they can easily choose the correct tax form. They can auto-import W-2 and other documents from employers and financial institutions. Filing with this option is like having a tax pro by your side. When you are done with filing, you’ll get a final review to ensure nothing is missed. Depending on the complexity of your situation, the price for TurboTax Live can range from $79 to $199. The price for the state returns ranges from $44 for the Basic option to $54 for Deluxe, Premier, and Self-employed.

With TurboTax Full Service, you just need to upload your tax forms to your tax expert and let them handle the rest. Depending on the complexity, the price can range from $199 to $389 for federal returns plus $54 for a state return.

TaxAct offers a live help program called Xpert Assist. You can add this option to any package you have chosen. It connects you with a tax expert, and you get unlimited advice through the whole filing process. Before you file your taxes, you get a review from a tax professional. Xpert Assist is included in all four plans of TaxAct, so it means that you get live advice from CPAs for $0.

Audit support

When comparing TaxAct and TurboTax, audit support is an important point to tackle.

If you are audited, you can choose TurboTax Audit Defense, and the tax professionals will help you throughout the process and get you a full representation in front of the Internal Revenue Service (IRS). TurboTax is partnering with TaxAudit, and it will take care of everything, including:

• Developing a plan of action
• Following up with the IRS
• Preparing IRS documents for you
• Representing you in all IRS meetings

The full audit representation is part of an audit defense product called MAX. It includes full identity restoration, identity theft monitoring and insurance, and priority care. Adding MAX to one of the paid versions of TurboTax will cost you an extra $49.

TaxAct doesn’t offer audit assistance itself but partners with Protection Plus. The service covers your tax returns for three years and assists with both federal and state audits. Protection Plus will also represent you before the IRS and assist you in case you have denied credit, tax fraud incidents, and debts. You can add the service to your plan for $39.95.

Final Verdict

TurboTax has many useful features. You get a review before you file, a mobile-friendly layout, and a lot of support. But the TaxAct paid packages pricing is more affordable, and they come up with the free human help support option Xpert Assist, making it a great fit for inexperienced filers.

Despite the differences, both TurboTax and TaxAct have some selling points in common. You can choose any of these providers if you have a simple tax situation or don’t want to visit the tax preparer’s office.

In the end, if you are looking for a program on a budget, TaxAct is the right software for you, but if you want a more user-friendly experience, then you have to choose TurboTax.