Best tax software for 2022: TurboTax, H&R Block, Jackson Hewitt and more

It’s time — the IRS announced it will begin accepting tax returns today and we recommend getting an early start. The 2022 tax season is already expected to be a headache with IRS staffing issues and new tax rules and documents, including Letter 6475 for stimulus recipients and Letter 6419 for those who received advanced child tax credit payments. 

This year’s tax filing process may require more preparation than previous years. While many of the top tax software programs can handle complex tax situations, you’ll want to use the one that meets your particular needs and budget.

If you earned less than $72,000 in 2021 as a single filer, then you qualify for free filing. But if your income is higher, or you have a complicated tax situation — including having to itemize deductions or account for changes in your household — you might opt for a more intuitive tax software platform to streamline the process. We’ve reviewed some of the best tax software below, with details on how to use them and how much they cost. Here are our top picks.

Intuit

TurboTax by Intuit is the clear front-runner for good reason. The software combines tax expertise and an easy user experience with an accessible interface. 

The technical setup is easy: Enter your information, import your tax documents and access your past TurboTax returns when needed. If your employer uses QuickBooks — or if you’re self-employed and manage your finances with QuickBooks — your tax forms may already be available in Intuit, saving you a step. TurboTax guides you through the process by asking straightforward questions, and never asks for information you’ve already given or that doesn’t relate to your particular situation. If a question is confusing or you need clarification, you can easily access additional information. You can also exit the process at any time and pick back up where you left off if you log onto your account from any device.

There are four products to choose from: Basic, Deluxe, Premier and Self-Employed. Deluxe, which is $78, is our recommendation for most filers if your tax year was even a tad complex, given that you’ll get most of the relevant deductions and credits not offered with the Basic version. Plus the Deluxe fee is less than you might pay for an accountant. If you know you won’t qualify for deductions or credits, stick with the free version.

TurboTax Premier is specifically designed for taxpayers with real estate, while TurboTax Self-Employed will help sole proprietors, freelancers and gig workers maximize their deductions. You can even enlist the help of a tax professional or CPA with TurboTax Live, which can supplement any of the company’s software offerings. TurboTax Audit Defense is available to offer audit protection and assistance, via a partnership with TaxAudit.com. 

The comprehensive benefits that come with TurboTax may cost more than other tax software, but the peace of mind you’ll receive could be worth the price tag.

Pricing

  • Free to $89 for federal
  • Free to $39 per state filing*
  • Free to $199 for TurboTax Live
  • Free to $389 for TurboTax Live Full Support

*up to $49 per state return with TurboTax Live and Live Full Support

H&R Block

H&R Block does just one thing, and it does it well: tax preparation. 

H&R Block compares favorably to our top pick, TurboTax, but it really shines in its free version, which covers simple returns as well as deductions for student loans and tuition fees. That makes it a perfect fit for filers without complicated tax situations who don’t want to pay, including students and recent grads.

The overall process is not as smooth as TurboTax, but it’s still a well-designed, interview-style system that guides you and sidesteps potential mistakes. The Help screens and extra information are useful, though not always as easy to access as with TurboTax. 

H&R Block also has plenty of add-ons for additional fees if, for example, you want a certified tax pro to review your tax return before filing it. For most students and those taking advantage of the free product, it’s probably not worth it to spend $70 to $100 for help from a professional, and the chances of being audited are low enough that the $20 audit protection won’t be necessary in most situations. 

We’re also fans of H&R Block’s virtual filing option, which lets you upload your documentation and have a tax expert take care of the rest. You can even import the prior year’s income tax returns from other platforms by uploading a PDF of your previous year’s return or importing your TurboTax data file. H&R Block offers a comprehensive money-back guarantee and will give you a 3% refund bonus if you opt to receive your tax refund as an Amazon gift card. One drawback with virtual filing is that you won’t receive in-person support from a tax professional if you end up getting audited unless you pay for a higher tier of service.

Pricing*

  • Free to $85 for federal
  • $37 for state
  • $39 or more for live support

*get unlimited help from live tax experts starting at $39 and an additional fee for state taxes.


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Jackson Hewitt

Unless you have no deductions to claim or qualify to file your taxes for free, we think Jackson Hewitt offers the best value for many tax filers. While it’s not quite as intuitive or flashy as TurboTax or H&R Block, filing your taxes for $25 is hard to beat. Unlike most competitors that offer different tiers of service depending on your tax situation, Jackson Hewitt Online lets you file for one price, regardless of how complicated your taxes are.

With Jackson Hewitt Online, both your federal and state taxes are just $25 — and you can file unlimited state taxes at no extra cost. It also features free IRS audit assistance and a Lifetime Accuracy Guarantee® to protect against unexpected penalties or interest. 

You can opt for the Basic, Deluxe or Platinum tier of the Worry-Free Guarantee plan, which promises to reimburse you if you end up receiving a reduced refund or face additional tax liabilities. Both the Deluxe and Platinum tiers also offer restoration assistance that help if your identity is stolen and a tax return is filed on your behalf. The Platinum tier includes Audit Security support with a dedicated specialist who will manage and represent your case. (Check out our FAQ below for more information on the likelihood of being audited and the factors that could increase your risk.) This pricing for these services are not disclosed and may vary.

And if, you want more one-on-one attention, you can file at a participating Walmart location starting at $59 or visit one of its offices to file with a tax pro (pricing can vary depending on your filing situation and state of residence).

Pricing 

  • $25 for federal and unlimited state filing; starting at $59 to file at Walmart with a tax pro

TaxAct

TaxAct is a straightforward service, but its major distinction is its $100,000 Accuracy Guarantee and Maximum Refund Guarantee, which promise to get you an accurate refund and the maximum allowable by law. If it fails to do so, TaxAct will refund you up to $100,000 to cover the difference between your actual and potential refund, your software costs and any associated legal or audit costs. 

If you are in a high tax bracket or have a particularly complicated tax situation where errors may be more likely, TaxAct could be for you. You can access tax-filing guidance from a tax specialist that ranges from in-app chat support with screen-share capabilities to unlimited one-on-one advice over the phone. It’s simple to import previous tax returns, navigate the platform and browse through the knowledge database as you input your itemized deductions.

Pricing

  • Free to $65 for federal
  • $40 to $45 per state filing
  • $35 to $140 for Xpert CPA support

TaxSlayer

TaxSlayer is an inexpensive tax preparation service and provides all of the tax forms you’ll need. If you freelanced in 2021, own your own business or did any sort of gig work, TaxSlayer’s $55 self-employed package price tag is hard to beat — plus it comes with professional tax support. While the free version comes with some degree of access to personalized tax advice, you’ll need to pay for a higher level package, such as TaxSlayer Premium, to get comprehensive assistance from a tax professional, including live phone and chat support, as well as audit protection. 

Pricing

  • Free to $55 for federal
  • Free to $40 per state filing

FreeTaxUSA

FreeTaxUSA is mostly free, except you’ll need to pay to file state taxes. It offers options for importing previous tax returns and filing an amended tax return. The Deluxe version includes priority live chat, customer support and access to its tax specialists and audit service. These tax professionals should be able to address all your specific income tax return questions — from what paperwork you need to how to understand an audit notice and write a response to the IRS.

Pricing

  • Free for federal
  • $15 per state filing
  • $7 Deluxe version

FAQs

Who can file their taxes for free? Is it really free?

There are two main ways to file your taxes for free. The first is through the IRS’ “File Free” program, which includes private companies that provide their services for free in partnership with the IRS. To qualify, you need to earn less than $72,000 in adjusted gross income. 

The second is through the free programs of non-alliance members, like Intuit’s TurboTax and H&R Block. These private services offer free products for those with simple filing situations, and as long as you don’t have complications like investment income or rental property income, you can stick with the free products all the way through filing. 

Note, however, that Intuit and other companies will often try to upsell you on other products throughout the process. Before signing up for a higher-tier product you hadn’t planned on, make sure you really need it. 

What is a ‘simple’ tax return?

When you file only a single W-2 from an employer, it’s considered a simple tax return. With a simple return, you won’t be itemizing deductions, claiming investment income or rental property, reporting freelance income or claiming business expenses like a home office.

Companies like Intuit and H&R Block explain the added complexity commensurate with their higher-tier products, so if you aren’t sure, double-check their lists before purchasing. You can also start filing with a free return in most cases and upgrade your service level if needed.

When should I pay extra to get live assistance from online tax software?

The beauty of well-designed tax software is that most filers won’t need to pay extra for expert help. All of the answers you need should only be a few clicks away, and if you need technical assistance (help with the software, not tax-related issues), support should be easily accessible.

If you find yourself constantly wanting to speak with a human tax expert or if you know your tax situation is complicated, you may be better off selecting tax software with tax expert support or simply hiring a CPA, or certified public accountant, on your own. 

How much does it cost to hire a CPA? Is it worth it?

According to the 2020-21 Fees Practices Survey released by the National Society of Accountants, working with a CPA for your tax filing will cost $200 to $500, depending on the complexity of your return — how many schedules and extra forms need to be completed — and where you live. Each additional schedule, for things like rental income or investment gains, could cost around $100.

If you have self-employment income, itemized deductions, investments or other complicated tax situations, the extra cost is likely to be worth it. It can also be easier to send off your forms to an expert and know they’ll take care of everything. Remember that the extra amount you’re paying in fees could get you a better return, making the upfront cost a smart investment.

Keep in mind, however, that it depends a lot on your individual filing situation, your withholdings and your tax bracket. As good as many software programs are, a human expert is often the way to go. 

When is my 2021 tax return due in 2022?

Your federal tax return for 2021 is due on April 18, 2022. Last year it was extended due to the pandemic, so we’ll keep you updated if the deadline pushes this year.

The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.

source: cnet.com