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2018 Ultimate Guide To The Best Tax Tools For Filing Your Own Taxes

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The 2018 season is here at last, and your stress signals might be going off. No need to panic, however, because we’ve got you covered with the tech that will make taxes much easier.

H&R Block and TurboTax have gained a reputation as the top tools for tax season, but are they necessarily the best? In this guide, we will help you, the individual tax filer, find the optimal tool for filing your taxes.

Why It Pays To File Your Own Taxes

If you’ve been considering filing taxes without the help of a tax professional, you are not alone. A survey of more than 5000 Americans by GoBanking discovered that 43% of Americans prefer to self-file.

With roughly half the nation choosing to self-file, here are some of the reasons why this option might be better for you:

  • Self filing gets the job done quick, with minimum fuss. However, you need to know what you are doing, otherwise you might mess up and delay your tax refund.
  • Tech tools now make it easier than ever. The IRS has its own tools, along with those from third-party providers.
  • Filing yourself means you don’t need to shell big bucks to a tax consultant.

Which Tools Do People Trust To Get The Job Done?

The stats show that do-it-yourself tax preparation software is popular with members of the general public. Tax tools like TurboTax are highly popular for their low cost and the convenience they offer.

Across three different review sites, we tracked the number of stars allocated to three of the best known tax prep brands. The three selected for the study were:

We drew on reviews from PCMag, BestCompany and NerdWallet. BestCompany, notably, gave each of the brands the lowest average scores out of all the review sites.

We’ve illustrated the review metrics below. Stars are given out of a possible maximum of five, indicating the highest reputation rank. Zero, the minimum, indicates the poorest reputation rank.

The stats indicate a slight preference for TurboTax, with H&R Block and TaxAct not too far behind. Below, we look at the individual tax tools in depth.

The 12 Best Tools For Self-Filing

1. Intuit TurboTax – Price Points: $0(Free), $39.99, $59.99-$149.99

TurboTax is the ideal tool for self-filers with high ratings across the board. In a head-to-head comparison by Business Insider in 2017, TurboTax beat out H&R Block. In the test, six Business Insider reviewers used both softwares to get the largest refund and compare them. Of the six, five reported enjoying the usage of TurboTax more, whereas one preferred H&R Block.

The software helps you file your taxes by paper or electronically to get the fastest refund. It is geared at helping people of all knowledge levels when it comes to doing taxes, including those who have not filed their own taxes before.

TurboTax has several editions geared at different segments of the population, all priced differently.

2. H&R Block Tax Software – Price Points: $19.95-$79.95

H&R Block helps you file your own taxes using software that collects your responses and guides you through the process.

The tax preparation services company has a complete suite of services for the tax filer. One option is to walk into its brick and mortar stores to have your taxes filed. You can also use its software online.

H&R Block stands out by offering extra services that make it more convenient for the tax filer. Such services include support via chat as well as an Audit Guarantee. Under the guarantee, if a customer is audited by the IRS, the company will help the individual address the audit.

Versions of the software are tailored to specific user groups, categorized as:

  • Basic – for straightforward, simple use cases
  • Deluxe – more financial wizardry targeted at real estate holders and investors
  • Premium – geared at self-employed individuals
  • Premium & Business – the tax software for owners of small business

3. TaxAct Plus – Price Points: $0(Free), $27, $39, $51

TaxAct has online tax filing software in editions ranging from Simple to Plus, Freelancer and Premium.

The Free package is suited to simple tax filings involving 1040EZ and 1040A. It covers Federal as well as state taxes. Plus, which is TaxAct’s most subscribed package, targets homeowners with itemized deductions and taxable investments.

TaxAct also has a Freelancer package, as well as a Premium package, which offers what they call “ultimate peace of mind”. Notably, a $100,000 accuracy guarantee will help your peace of mind. This means if there are any errors, TaxAct promises to cover the costs up to that amount.

4. IRS Where’s My Refund – Price Points: Free

This tool won’t exactly help you file tax returns, but it’s very useful after you have filed and are waiting for your tax refund. According to a TurboTax report, efiling gives the shortest wait in order to receive an IRS tax refund. The IRS gives a timeline of 21 days for online filing. If, however, you are one of the small minority who mail paper returns, the wait will be longer. Paper mailings have a wait time of 6 up to 8 weeks after the IRS receives your filing.

While you wait for your refund, visit Where’s My Refund. You will need to enter in details about your filing, such as Social Security Number and your filing status. You will also need to state your expected refund.

5. IRS Free File – Price Points: Free

Free File lets you file your taxes using the IRS’s online software and instructions for filing your taxes for free. This is an essential tool by the IRS to help you file taxes yourself. The IRS has partnered with brand name software providers to provide the software. The software lets you file both federal and state taxes. If you are not eligible to use the software, there are online fillable forms that you can use from the website.

In order to use the software, visit the Free File website. You will then see a list of the available partner tools, and select the best one for your profile. Then click through to the partner’s site and complete your filing there. You will need information such as prior year filings as well as documentation for your income.

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6. IRS GetTranscript – Price Points: Free

This tool by the IRS lets you retrieve a transcript of your tax account online or through the mail. You can also view your tax account through the website.

There are various tax transcripts available on the website. You can request any of them to determine tax data you have on file. You can also see what you owe or refunds due to you by using the tool.

Here are some of the tax transcripts you can retrieve:

  • Tax Account Transcript – it shows the status of your account up to 10 years ago, with data such as taxable income
  • Tax Return Transcript – reflects line items from tax forms such as 1040EZ, Form 1040, and others
  • Wages and Income Transcript – shows the income on forms such as W2, 1098, 1099, among others

7. TaxAct Tax Dictionary – Price Points: Free

The TaxAct Tax Dictionary is a free tool by TaxAct to help you understand the jargon you may find on tax forms. Look up any tax-related terms here to understand what they mean and how to address them in your tax filings.

You will find definitions for important terms like Adjusted Gross Income (AGI), Roth IRA and TANF. The dictionary will improve your overall understanding of tax terms and concepts.

8. H&R Block Free Income Tax Calculator And Estimator – Price Points: Free

H&R Block has a plethora of helpful tools for tax filers on its website. This tool analyzes your responses to a set of income questions to estimate your payable taxes and your applicable tax refund, if any.

It’s best to use this tool if you want to get a sense of your tax liability to ensure you are not surprised when filing time comes. The tool automates the estimation based on your responses. It also adjusts for tax credits, exemptions for dependents, and various deductions.

9. TaxSlayer – Price Points: $0(Free), $17, $35, $55

TaxSlayer is an online filing software with a free version for federal and state income taxes. Anyone filing 1040EZ can file on TaxSlayer’s website for free.

For those who use TaxSlayer Classic or Premium, you can also get your refund almost instantly. With the TaxSlayer RefundNow program, you skip the wait and get a refund within 48 hours. The program also covers your tax preparation costs. This means you do not need to pay out-of-pocket for any tax-filing expenses. The costs are paid out of your refund from the IRS.

TaxSlayer comes with a Maximum Refund Guarantee. If you do not get the maximum refund, they will reimburse you the cost of the software. In addition, the 100% Accuracy Guarantee promises to refund you for any errors up to the amount of penalties or interest fees from the IRS.

10. TaxAct Self Employment Tax Calculator – Price Points: Free

For the self-employed, tax filing can be more complicated than if you are an employee.

An important distinction is that employees only pay half of the Social Security and Medicare tax. The other half is paid by their employer. Self-employed individuals, on the other hand, have to pay both portions.

TaxAct’s Calculator helps determine Social Security and Medicare taxes for the self-employed.

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11. TurboTax Tax Documents Advisor – Price Points: Free

Figuring out which forms to file can be a problem. Based on your income-related activities for the year, this tool helps you determine all the different forms you will need to fill out and submit as part of your tax filings.

There’s a wide variety of tax forms you may need, such as:

  • 1040A – shortened, simpler version of long form 1040 tax form
  • Schedule A – form for itemized deductions
  • Schedule C – used to report profits and losses by a sole proprietor
  • W-2G – used to report lottery and gambling winnings
  • 1099-B – used to report transactions involving brokerage investments
  • 2555 – used to calculate foreign income tax exemptions

The more complex your economic activity, the greater the variety of tax documents you will likely need.

12. TurboTax Tax Bracket Calculator – Price Points: Free

Tax rates vary based on the amount of taxable income. This free tool helps you determine your applicable tax rate based on your income level.

The calculator adjusts for other factors that affect tax bracket, such as marriage status and if you are a head of household.

File Your Taxes The Easy Way With Online Tax Tools

As you can see, tools by the major tax prep companies and others can help you have a stress-free tax season.

With digital tools, consulting a tax accountant becomes less of a necessity. If your taxes are relatively straight-forward, you can even get it done with entirely free tools. On the other hand, if you have a great variety of taxable income types, you might want to upgrade. The advantages of the paid plans is that many companies offer enhanced service. These offer instant chat, phone support, as well as various guarantees in case something goes wrong.