15 Best Tax Software 2020 (and 7 Free Filing Options Ranked)

15 Best Tax Software 2020 (and 7 Free Filing Options Ranked)
Last Updated on June 11, 2020 by Adam Enfroy

As Benjamin Franklin famously said in 1789, “…in this world nothing can be said to be certain, except death and taxes.” Every law-abiding citizen needs to file their personal and business taxes on time.

And to do that, you can either hire a CPA or do your own taxes with the best tax software.

There are a ton of different software options available online to assist you with your tax preparation and filing and make things simpler and more efficient. But with the abundance of choices, it can become overwhelming to make the right decision.

To make things easier, I compiled a list of the 15 best tax software (with 7 free options) to help you file tax returns without any mistakes.

Let’s get started.

Table of Contents

What is the Best Tax Software?

1. Intuit TurboTax.

TurboTax: Best Tax Software

TurboTax is famous for handling simple tax returns efficiently. It also offers a free filing option along with easy navigation that can be used by a layman for personal tax filing purposes.

Key Features:

  • Navigation System: The guided navigation system assists the new users by asking a series of easy-to-understand questions. The process becomes more comfortable for users when they register the right answer.
  • In-Depth Articles: It offers a repository of in-depth articles where users can get answers to all the frequently asked questions and other relevant information.
  • TurboTax Live: This feature allows users to share their screens and get their returns reviewed directly from CPAs and EAs. Users also get the option to connect with a CPA on demand. Users can connect through four options, including Basic live at $49.99, Deluxe live at $89.99, Premier live at $139.99, and Self-employed live at $169.99.
  • Max Assist and Defend: This feature helps users get audit protection for complicated tax filing. You can purchase it at an additional cost of $44.99.

Pros:

  • The interview style questionnaire is engaging and ensures all the relevant information is fed to the system.
  • It offers on-screen, face-to-face support for users who get stuck during the process of tax filing.
  • It allows taxpayers to file a 1040 and state return free of cost.
  • You can access the web version of TurboTax through its official website. Hence, users don’t have to install the software.
  • The user-friendly interface allows taxpayers to navigate from one section to another easily.
  • Users are allowed to import their W-2 if it is from a TurboTax partner.
  • It also allows users to take a picture of their W-2 form and file it directly from their smartphones.
  • The Expense Finder feature helps freelancers and business owners to identify every single transaction of the last year that is eligible to qualify as deductible business expenditure.

Cons:

  • The price fluctuates on different platforms.
  • It is also one of the most expensive software tools in the market.
  • Users can’t determine the final cost until they file the entire return.

Pricing:

TurboTax offers four pricing plans:

  • TurboTax Self-Employed – Cost: $119.99 + $39.99 for each state return.
  • TurboTax Premier – Cost: $79.99 + $39.99 for each state return.
  • TurboTax Deluxe – Cost: $59.99 + $39.99 for each state return.
  • TurboTax Free – Cost: $0 + $29.99 for each state return.

2. Liberty Tax.

Liberty Tax Cover Page

Liberty Tax can significantly cut down your tax filing cost. The affordable online tax software comes with a user-friendly interface and a lot of unique features to attract tax filers.

Key Features:

  • Tax Refund Anticipation Loan: It is one of the most attractive features of the Liberty Tax that makes it popular among tax filers. Users can get Easy Advance from $500 to $6,250 depending upon the expected federal refund after the deduction of authorization fees.
  • Enhanced Audit Assistance: It is an add-on package that users can purchase to get pre-audit aid for the documents that the IRS might request. It also assists in replying to the IRS’s correspondence and offers post-audit advice.
  • Maximum Refund Guarantee: Liberty Tax offers a maximum refund guarantee to its clients. When you file the same return amount through a competitor’s software and get eligible for a higher refund or lesser federal tax liability, Liberty Tax will promptly refund the amount paid for tax preparation services.
  • Tax Estimator: It is a dummy tax return tool that helps the user to estimate the amount of refund or tax liability before tax filing.

Pros:

  • It allows users to import W-2 through ADP.
  • Its Help Sidebar feature makes several things more comfortable during tax filing, including the display of real-time refund display and tax help through live chat sessions.
  • It is capable of identifying the most applicable software edition as per the tax situation for efficiency.
  • The software offers seamless synchronization to get access to previous years’ documents.
  • The interface is relatively simple and easy to use for new tax filers.

Cons:

  • No free version is available for even basic tax filing.
  • Limited options for customer filing.
  • Absence of in-depth knowledge base.

Pricing:

Liberty Tax offers four paid editions:

  • Simple Edition: Federal Returns: $34.95, State Returns $35.95.
  • Basic Edition: Federal Returns: $44.95, State Returns: $39.95
  • Deluxe Edition: Federal Returns: $64.95, State Returns: $39.95
  • Premium Edition: Federal Returns: $89.95, State Returns: $39.95

3. Jackson Hewitt.

Jackson Hewitt Cover photo

Jackson Hewitt offers the second-largest tax preparation service in the USA. It also provides robust customer support through its brick and mortar stores spread across the country.

Key Features:

  • Robust Customer Support: With over 3000 brick and mortar stores located inside Walmart stores spread all over the USA; Jackson Hewitt offers robust customer support. It also allows users to file tax return through offline mode.
  • Tax Tools: It offers a plethora of user-friendly and efficient tools, including refund status checker, W-2 locator tool, and tax estimator, among others.
  • Refund Advance: It offers users to take an advance loan of up to $3,500 for an estimated tax return at as low as 0% APR.
  • Audit Assistance: It offers free Audit Assistance service to users.

Pros:

  • Users can leverage the software’s free edition for simple tax filing.
  • It allows users to import W-2 forms and previous year’s tax documents from other tax services.
  • It offers a guaranteed maximum refund and Accuracy for customer satisfaction.
  • It offers a smartphone-friendly website.
  • Users always have the option to contact a physical branch if required.
  • You also get unlimited live chat and email support.

Cons:

  • The knowledge base is not as detailed as it should be.
  • For complex cases, you need to visit their physical office.
  • Phone support is not available during certain times.

Pricing:

There’s no mention of pricing plans on the official website. However, online reviews suggest that the prices start from $29.99.

4. AvaTax.

AvaTax: Best Tax Platform

Avalara’s AvaTax is one of the prominent tax automation performers that can escalate your efforts towards achieving tax compliance. It is capable of handling simple returns and complex tax obligations efficiently.

Key Features:

  • Error-Free Calculation: Its handy feature sets the nexus only once and later applies the appropriate rates automatically for the following transactions with precision. It leverages an in-built geolocation and address-authentication system to ensure that the data is accurate, visible, and accessible.
  • Transparent: The smart reporting suite makes the process of taxation transparent and straightforward. Users can get summarized payments in a single schedule.
  • Useful Integrations: It comes loaded with 500+ pre-built integrations that connect it with other popular POS, accounting, and ERP systems.
  • International Taxations: Avalara offers many international taxation or tax-specific add-ons to enhance the efficiency of the software. These addons include Avalara CertCapture, Avalara Returns, and AvaTax Excise, among others.

Pros:

  • The software uses regularly updated tax data to ensure accurate calculations.
  • It offers faster processing of complex tax filings.
  • Users can connect with their custom applications through a well-defined developer kit.
  • The web-based application can be used across devices and platforms with the same efficiency.
  • It complies with robust data security standards to offer highly secured services.

Cons:

  • Customer support professionals are not well qualified and experienced.
  • Software is not error-free. Some bugs might irritate you.

Pricing:

The paid version costs $50.00.

5. Drake Tax.

Drake Tax

Drake Tax offers an easy-to-use, thorough, and accurate software solution for standard tax filing requirements. The software provides excellent customizable reporting and other user-friendly features to meet the tax requirements of users.

Key Features:

  • Ease Of Use: It offers simple navigation and enables users to move from one item to another swiftly. It provides all the primary tax forms, consolidates gift & estate taxes, and includes other applications to handle document transfer efficiently.
  • Comprehensive Filing: The software offers support to some of the most complicated tax cases. It comes equipped with all 1040 forms, including all federal packages and 48 state packages. It also provides access to forms for S-corps, C-corps, partnerships, trusts, estates, and tax-exempt organizations.
  • Planning Tools: Its tax-planning features help the user to compare taxes on a YoY basis. It helps to archive old information and comes equipped with an amortization schedule.
  • Paperless Filing: It encourages the reduced usage of paper required to prepare and file taxes through options including share information for revisions, e-sign, and e-file of tax documents.

Pros:

  • It ensures easy data import from QuickBooks or Client Write-Up. Users who love working on spreadsheets can import the data directly into Drake Tax efficiently.
  • Its refund estimator feature runs throughout the process to know the refund amount in real-time and rectifies issues affecting the refund.
  • You can easily identify the mistakes and fix them through their review tool.
  • It offers robust customer support.
  • The software also offers tax filing forms in the Spanish language.
  • Users can e-file state and federal returns.

Cons:

  • It doesn’t support remote signature.
  • Its user interface looks a little dated.

Pricing:

Drake Tax costs $330 per year and comes with a free trial version. It doesn’t offer a free plan.

6. Thomson Reuters’ ONESOURCE.

Thomson Reuters Onesource

ONESOURCE is a capable tax software that is perfect for the needs of large corporations, including businesses with international interests, and face extremely complex tax situations.

Key Features:

  • User Interface: It comes equipped with a well-organized dashboard and eliminates the possibility of repetitive data entry. It offers efficient integration with other tax compliance and reporting applications.
  • Web-Based: The web-based platform supports multiple user access from different devices and platforms. This functionality makes it perfect for a corporate tax department that has employed several professionals for compliance and reporting.
  • One-time Data Entry: ONESOURCE shares the input data across the system with all the relevant applications to eliminate multiple entries of the same data.
  • Process Management: The Process Management capabilities help in streamlining the workflow to extract maximum efficiency from the team.

Pros:

  • It comes secured with end-to-end encryption for robust data security.
  • You get a built-in audit manager to assist users in navigating quickly through the entire process.
  • Users can directly import data from Microsoft Excel spreadsheets into ONESOURCE software.
  • It allows the electronic filing of taxes with appropriate agencies through an encrypted channel.
  • The software supports federal, state, and international tax obligations.
  • It meets state, federal, and international tax compliance rules to cover the needs of global businesses.

Cons:

  • So many features can be overwhelming for new users.
  • Not feasible for small and medium businesses.

Pricing:

Users need to contact the vendor to get a quote based on specific business requirements.

7. QuickBooks.

QuickBooks cover image

QuickBooks is perfect for enhancing the efficacy of financial management through innovative ways. Its functions include the possibility to prepare and file taxes while responding to standards and legislation that is valid for the user’s scope of action.

Key Features:

  • Accountant Tools: QuickBooks offers a plethora of insights and organizational capabilities that help organizations keep accounting data organized, including overdue items, accounting notes, payable bills, and contacts’ data.
  • Automated Reporting: This feature ensures that even the tiniest taxable amount is captured during tax filing to avoid any penalty or interest.
  • Highly Secure: It offers robust security set up to ensure data through end-to-end encryption of data entries.

Pros:

  • The majority of accounting features can be accessed online.
  • It generates consolidated end-of-year reports on users’ business income, profit and loss, payables, and other things. It is also efficiently integrated with Intuit’s TurboTax to allow users to import financial data easily and prepare for tax returns.
  • It can also be connected to bank and credit card accounts to pull out taxable income information automatically.
  • It generates a plethora of reports to keep business informed about tax status.
  • They offer a mobile app to prepare and file on the go.

Cons:

  • It is not capable of handling complex tax filings.
  • Customer support is not efficient and robust.

Pricing:

You don’t get a freemium plan, although you do get a free trial.

Paid plans include:

  • Self-employed: $5/month
  • Simple Start: $7/month
  • Essentials: $17/month
  • Plus: $25/month

8. Clarus R+D.

Clarus R+D

The software is best for making tax credit tasks simple for small and medium-sized businesses. It provides users a robust combination of cutting-edge technology and efficient customer support through trained tax experts and CPAs.

Key Features:

  • Automatic Computation: It is capable of automatically calculating R&D tax credit for users based on collected data for the user.
  • Compliance: Clarus generates secure documentation and reports automatically.
  • Simplified Tax Process: Clarus R+D is perfect for all the heavy lifting of the tax prep. It is an ideal tool for small businesses that don’t have the time and resources to manage and calculate tax credits accurately.

Pros:

  • It offers robust support from qualified tax professionals for all the queries and audit requirements.
  • It offers reports with all data documented securely in an easy to understand presentation.
  • It reduces the need for manual calculations.
  • It is a SaaS-based software that can be used from anywhere via multiple devices.

Cons:

  • No custom management.
  • You don’t get any free trial despite being targeted towards small businesses.

Pricing:

It offers quote-based plans depending upon the requirement of businesses.

What is the Best Free Tax Software?

9. OLT Online Taxes.

OLT Online Taxes

OLT Online Taxes is a neatly packed, web-based tax preparation solution that enables taxpayers to prepare their federal tax returns via IRS’s Free File Alliance.

Key Features:

  • An E-file Solution: OLT’s IRS e-file solution offers an efficient alternative to paper tax preparation. It can efficiently meet the taxation requirements of small, medium, and large businesses.
  • Robust Security: Every information entered in OLT is verified through Trust Safety to ensure optimal security. It also gives audit support to assist taxpayers in making the backup of their returns.
  • Navigation: It comes loaded with several tabs of navigation, including a top-level navigation tab to file state and federal returns. The second level navigation tab gives you access to income, primary information, credits, adjustments, taxes & deductions, and tax summary, among others.
  • Self-Adjusting Glossary: It comes equipped with a glossary sidebar that delivers links to insightful articles on specific tax topics. The suggested content in the glossary keeps on adjusting automatically, depending upon the data entered into the tool.

Pros:

  • It allows preparation and filing of 1040, 1040EZ, and 1040A forms free of cost.
  • It provides customer support via phone and live chat.
  • OLT provides exceptional guidance to users who undergo audit seasons.
  • The system supports all kinds of forms and schedules to meet the different needs of various businesses.
  • Users can enter tax return data from previous years.

Cons:

  • Life events guided interview is absent.
  • Not helpful for new tax filers.

Pricing:

It comes with a free edition. The premium edition costs $15.90.

10. Credit Karma.

Credit Karma

Credit Karma is an excellent option for professionals who are looking for a free but powerful tool for preparation and e-filing of returns. The software comes loaded with several advanced features and offers reliable assistance and guidance for the US taxpayers.

Key Features:

  • Supports Multiple Tax Preparation Forms: The software supports virtually all popular forms and schedules to ensure efficient tax preparation and filing. It covers essential requirements, including itemized deductions, capital gain and loss, and self-employment income, among others.
  • User Interface: It offers tax preparation modules arrangement in an intuitive dashboard. It is also visibly displayed at a horizontal toolbar at the top of the screen to users can easily select among Basic Info, Federal, and State Taxes.
  • Data Check: Credit Karma tax software double-checks the data entered by the user before transferring it. In case the data depicts any error or omission, it gives an option to revert to the offending screens for correction.
  • Customizable: It allows users to choose the tax scope that is applicable to them, including Deductions, Wages, and Income, among others.

Pros:

  • The software is available free for use.
  • It offers reliable guidance and customer assistance across the USA.
  • It allows users to keep the entire refund without any fees or upsells on its behalf.
  • The company also provides credit card and loan packages and identity monitoring services, among others.
  • Credit Karma offers its users forms and guidance for state and federal taxes of the USA.

Cons:

  • The user interface of the software looks old school.
  • The customer support is not robust.

Pricing:

It is available free of cost.

11. H&R Block.

H&R Block cover page

H&R Block is one of the most recognized names in the tax arena. It offers comprehensive tax support with a capable user interface and lots of user-friendly features.

Key Features:

  • Customer Support: It offers one of the most comprehensive customer support through over 12,000 offices located all over the USA.
  • Ask A Pro: Regardless of which edition of the software you are using, you can always have the required assistance through chat and screen share by paying $40 to $50.
  • Free Filing: H&R Block’s ‘Free Filing’ option offers a more useful DIY proposition than other tax software companies. Users can leverage the advantages of home mortgage interest and earn income credit deductions through this feature.
  • User-Friendly Navigation: Its user interface is easy to navigate. Users can use the menu at the top to easily backtrack and rectify any errors.

Pros:

  • It offers personalized help through expert professionals for swift tax filing.
  • H&R Block’s online version is easy to use and navigate.
  • It allows users to import the W-2 form quickly and also input data with much ease.
  • Its customer support offers the guaranteed assistance of the IRS certified and tested Enrolled agent in case a user commits any kind of mistake in tax filing.
  • Users have the option to take the tx pro review service at an extra cost to avoid any bloopers.
  • H&R Block runs every filing through its Accuracy Check feature to identify errors and tax-saving opportunities.
  • The software offers a tax refund advance after the taxpayer meets the required threshold.

Cons:

  • Its informative content is not in-depth enough to answer all the queries of the users.
  • The lower-priced plans are not able to handle complex tax transactions.

Pricing:

H&R Block offers a freemium plan. So if you only require basic functions, the free plan would suffice.

After that, they offer six pricing plans:

  • Basic: $29.95
  • Deluxe: $54.95
  • Premium: $74.95
  • Self Employed: $79.99
  • Premium & Business: $89.95

12. TaxAct.

TaxAct Cover Photo

TaxAct is one of the most affordable tax platforms. It is primarily a boon for users who are looking for an affordable option to execute complex transactions. They also provide a lot of TaxAct offers for added discounts.

Key Features:

  • Refund Bonus: TaxAct has partnered with several leading retailers and restaurants in the USA, including Regal, Domino’s, Amazon, Bed Bath & Beyond, GameStop, and The Home Depot. If the user decides to transfer a portion of the refund to a gift card of one of the mentioned retailers, then TaxAct rewards them with a bonus of up to $100.
  • Previous Tax Returns: It allows users to import the data of earlier years’ TaxAct returns to make the filing process efficient. It also allows users to import data from other vendors, including Turbotax and H&R, among others.
  • Accuracy Guarantee: It offers a $100 accuracy guarantee in case of any mistake. That’s pretty bold and unique!
  • Web-Based: Being a web-based software, it offers greater flexibility to use the platform from any device and any geography. It also provides a mobile application for enhanced smartphone experience.

Pros:

  • It allows users to pay the filing fees from the refund they get.
  • Once the user is done, its review and the alert system reflect errors and omissions. It also makes recommendations to add deductions or credit to enhance your return filing.
  • Users can buy additional audit protection for $39 to ensure qualified people engage with IRS officers in case of an audit.
  • Taxpayers can get a refund through a check, direct deposit, or a prepaid card.

Cons:

  • W-2 import is not available.
  • Customer support is not robust and is a bit expensive.
  • Tools and functionalities are limited in comparison to other tools.

Pricing:

For Simple filers with dependents, college expenses, and retirement income, you can use their free plan.

For more complex requirements, it offers four pricing plans:

  • TaxAct Basic+ – Federal: $10 to $15, State: $19.95
  • TaxAct Deluxe+ – Federal: $30 to $48, State: $39.95
  • TaxAct Premier+ – Federal: $40 to $50, State: $39.95
  • TaxAct Self Employed – Federal: $60 to $78, State: $39.95

13. FreeTaxUSA.

FreeTaxUSA: tax software

FreeTaxUSA is a low cost and an apt tool for tax filers who have a fair idea about how taxation eco-system works. It is perfect for those who don’t need a sophisticated platform with all the bells and whistles.

Key Features:

  • User-Friendly: Easy to use, and a no-nonsense user-interface is one of its USPs. Its simple UI offers a rather dull experience with no presence of fancy color palettes, slick animations, or videos.
  • Capable Free Version: It free version offers all the required forms for which you would need to buy a premium version of any other tax software. It can handle forms, including self-employment (Schedule C), capital gains transactions (Schedule D), rental real estate (Schedule E), and other income sources.
  • Free Support: Unlike other tax software, it offers free of cost customer support. The service is limited but can resolve all the basic queries of a tax filer.
  • Guaranteed Accuracy: The software offers a full guarantee of accurate tax filing. It pays interest and penalties on your behalf, caused due to wrong filing of the tax.

Pros:

  • Customers can easily get tax refunds through e-file and direct deposit on FreeTaxUSA.
  • Through its Audit Assist feature, users can get full assistance to represent the case before the IRS.
  • Users can pay any fees for not having healthcare coverage through FreeTaxUSA. It also assists in filing a claim to get an exemption from the penalty.
  • The Deluxe Edition offers unlimited amended audit assist, return filing, and priority support.
  • Pop-ups help users in using the software more efficiently.
  • It doesn’t charge for the roll-over of prior-year tax data.

Cons:

  • Audit Assist feature is only available for Deluxe plan customers.
  • Not capable of handling complex tax filings.
  • Customer support options are limited.

Pricing:

You get a free plan for a maximum refund and filing your federal return. Apart from the free version, the Deluxe Edition costs $6.99.

14. TaxSlayer.

TaxSlayer

TaxSlayer offers a value for money proposition for tax filers who are looking for great features, user interface, and customer support at a bargain.

Key Features:

  • Robust Knowledge Base: Its strong online knowledge-base offers detailed information about tax filing and the features of the software. Users can search for specific answers and resolve most of their issues without any customer support.
  • Easy To Use: It offers a user-friendly interface that is a boon for beginners and small business owners. The setup looks neat and is available with an easy to use guide.
  • Value For Money: It offers robust customer support, a plethora of features, and greater usability at a much lower price than other competitors in the market.
  • Cheap State Return Filing: Irrespective of the plan users are using, it charges a flat fee of $29 to file a state return. Members from the military can file the state return at a discounted price of $15.

Pros:

  • It offers interest and penalty reimbursement guarantee in case of any error.
  • It offers filing support through phone calls and live chat.
  • TaxSlayer allows the import of W-2 from a list of employers, including upload of PDF file of previous tax returns to pre-populate user information.
  • The cloud-based software empowers users to switch between devices, including desktops and smartphones, swiftly.
  • Users can download the smartphone application from iOS and Google PlayStore.

Cons:

  • Customer support from qualified tax professionals is expensive.
  • Audit support is pretty basic.
  • You can only determine the final price after the filing of tax.

Pricing:

You can make use of the freemium plan for a simple tax situation.

There are four paid editions apart from the free version:

  • Classic: $17
  • Premium: $37
  • Self-Employed: $47

15. Free File.

Free File: File Federal Taxes For Free

Free Files is the result of an alliance between the International Revenue Service (IRS) and the Free File Alliance. The free service is a great information resource and offers easy tax prep software.

Key Features:

  • Tax Breaks: It offers a question-and-answer format that assists in helping eligible taxpayers to find tax breaks efficiently.
  • Efficient Online Extensions: In case a user fails to finish the returns before the deadline (April 18), then a six-month extension can be requested by leveraging the Free File feature.
  • Free Forms: It offers Free Electronic File Fillable Forms for taxpayers’ convenience. It is an efficient option for tax filers to prepare and file income tax without any assistance.
  • Free: The taxation platform is free of cost and comes equipped with a direct refund for faster processing.

Pros:

  • It offers separate modules for students, self-employed taxpayers, military professionals, government entities, and international payers, among others.
  • Apart from English, the software is available in other languages, including Japanese, Vietnamese, Spanish, Chinese, and Russian.
  • The software offers detailed how-to guides to inform users and save their time.
  • Great tool for people who have knowledge about tax filing and don’t want to spend on a paid tool.

Cons:

  • Limited features for complicated tax filing.
  • Customer support is not robust for complex tax issues.

Pricing:

It is available free of cost.

What is Tax Software?

Tax software platforms are best suited for assisting individuals or organizations in preparing for and file income or tax returns. It is meant to streamline the process of filing taxes by guiding the user through various relevant tax forms and issues.

Moreover, tax software is capable of automatically calculating the individual’s or company’s tax obligations. Many tax software tools have now also rolled out web-based versions to enable users to use the software easily from any internet-enabled device, including computers and smartphones.

Besides standard deductions, tax software helps the taxpayer make some extra savings or bank on less popular deductions. For example, tax preparers may have complicated tax situations and find extra savings based on their:

  • Student loan interest
  • Rental properties and income
  • Child tax credits
  • Mileage reimbursement
  • Business phone use
  • Home office savings

The best part is that almost all of them guarantee absolute accuracy, audit defense, and the highest possible returns to help users maximize savings.

How Do You Choose the Best Tax Preparation Software?

During tax season, filing tax through paper alone attracts an error rate of 20 percent. Taxpayers can reduce the possibility of making any error to under 1 percent through online tax filing. Apart from saving money, having the right tax software can help you avoid unwanted mistakes and IRS audits.

Here are a few points that you should consider before choosing the perfect tax software.

1. Software Version.

Premium or basic? The most daunting task is to decide which software version meets your requirements efficiently. Users get confused between questions, ‘is paying extra bucks for the premium version worth it?’ and ‘will basic version meet my requirement?’ There is no clear answer to both the questions.

The basic version might not have all the features, while premium versions have all the base features, including their USPs. Open-source software tools generally offer all the base features in their basic version and charge for premium versions only to provide customer support.

It is advisable to read features of all the versions and compare them against your requirements to make the right decision. If you are still confused, then it would be best to go with the premium version that has all the features.

2. Need to Prepare a State Tax Return.

Some vendors include the price of state of return tax in the subscription charges and others separately. If you are not filing for the state tax return, then it is better to buy a tax software that charges the return separately. This way, you can save at least $25.

3. Help for Tax Deductions.

Taxpayers should look for software that offers an in-depth knowledge base about tax laws and offers quick links to IRS publications. Ensure that the software has a video tutorial to assist users in understanding how to execute the entire process. It helps users to prepare for better filing.

Make sure that the tax software can pull out the data of your non-cash donations to apply for a tax deduction. The tax deduction finder feature will make sure that you don’t miss any details by asking you all the relevant questions. Self-employed professionals should make sure that the software includes Schedule C to calculate capital gains efficiently.

4. Consider Open Source Software.

There are several open-source tax software available than can be used for free. Most tax filing platforms are best for users who need to file a fundamental and straightforward return. Some of them have free versions that are capable of filing complex returns as well.

Take FreeTaxUSA, for instance:

FreeTaxUSA: Free federal returns

With FreeTaxUSA, you can file your federal return for free and have to pay extra for only state tax returns and other options services.

Users who are experienced with tax filing and don’t need spoon-feeding can also consider open-source software to save extra bucks.

5. Customer Support.

Make sure that the tax software offers robust customer support and equips with qualified tax professionals to assist you efficiently. Several lead tax software vendors provide online chat support, but it makes the taxpayer wait for several minutes to get answers.

Check out whether there is a fee for having a tax professional on demand for help, or whether the tax software vendor provides audit assistance or not. Also, look for the toll-free number and email assistance.

Executive Summary.

So, there you have it – some of the best tax software platforms that you can consider for the 2020 financial year.

While selecting the right software, there are a few basic points that you must keep in mind, including:

  • Accuracy of tax filing
  • Robust Customer Support during the filing and audit process
  • Maximum return for business or personal finances
  • Easy to use interface
  • In-depth knowledge base to address queries
  • Transparent pricing

Above mentioned points make the base of a robust tax filing tool. Ponder over these points carefully before making the final decision this tax year.

Which tax software do you use? Are any not included on the list? Let me know in the comments. 

Recommended Reading on AdamEnfroy.com: If you’re looking to take hold of your business finances, check out my guide to the best small business accounting software and if you’re just getting started, read my ultimate guide to the best business ideas to start this year.