Tax Software: Three Popular Web-Based Options

Posted by Matt Thommes on 2/19/2006

It's that time of year again in the United States - taxes must be submitted by April 15.

There are many options available to assist with filing your taxes. You can get help from a tax professional, or you can do it yourself with software.

The past month or so, you've probably noticed an abundance of tax software appearing on store shelves, in the check-out line, or advertised on television. Some software you can purchase as a physical box, with which you manually install the program on your computer. The companies that offer these programs also offer "online" versions of their software, which allows you to do your entire tax return over the internet.

This is the ideal approach, since there is no installation involved.

This article will examine three online tax software services - examining their ease of use, and pricing.

You now have no excuse for not getting your taxes done on time!

Tax software: three popular web-based options

The three online services that will be examined will be:

In order to examine each service separately, I've actually completed my taxes with all three services, but only chose to file with one of them. This allowed me to notice the benefits (or drawbacks) of each service.

Ease of use

TaxACT

Despite all the money poured into marketing and advertising their products, as well as their "monopoly" in the "tax software" department - TurboTax and H&R Block took a "back seat," when it came to "ease of use."

In fact, the "least prominent" service of the three, TaxACT, was actually the easiest to use. It seemed to go faster than the other two, as well.

The interface was clean and uncluttered. The options were kept to a minimum, so as not to confuse the user.

Screen shot of TaxACT interface

H&R Block

H&R Block also tried the "uncluttered interface approach," but forced users to use a "popup" window, to access the software:

Screen shot of popup window

Also, with all three services, a "timeout" occurred after a certain number of "idle" minutes passed (for instance, if you walked away from your computer, without finishing your taxes) - but H&R Block was the only service to present an annoying JavaScript dialog, forcing you to immediately attend to it, while the other two services kept their "timeouts" in the background.

Screen shot of dialog box

The dialog box above "locks" your browser, until you attend to this message, and make a choice.

All three services force you to "re-login," after a certain amount of time, which is a necessary security feature. However, H&R Block's "timeout" seemed to happen much faster than the other two services.

(As a side note, for all three services, your progress is always saved, after every step you take. So, even if the application logs out, on it's own, your information is saved.)

TurboTax

Even though the TaxACT interface was very clean and uncluttered, the TurboTax interface was done very well, too. In fact, the overall layout and aesthetic appeal has got to go in favor of TurboTax:

Screen shot of TurboTax interface

TurboTax also gives you the option to have them "Walk you through every step," or you can manually go to the pages you need:

Screen shot of TurboTax application

The other two services simply walked you through every step - but it's nice to have the option, for more advanced users, who already know where they'd like to go.

Another added benefit for using TurboTax, since I used it last year, was that I was able to import last year's tax information, to save me from having to enter the same information again. It even works if you just used the desktop version last year, as opposed to the online version. This saved a lot of steps.

Pricing

The pricing for each service varies, depending on your needs, and what state you live in. Some plans include more forms, features, or capabilities - while others are just basic. Some plans are also only for Federal returns, while other plans include State returns, as well.

I've went with the "Deluxe," or "Premium" versions of each - just to be sure I had everything covered. If you're filing your State return, as well - you'll want to make sure it's covered in the cost. Don't get caught "off guard" with unexpected costs, at the very end. And most importantly, don't be fooled by constant advertising of "FREE." If you see the word "FREE" a lot, chances are it's not free.

TaxACT presents the most appealing prices:

Screen shot of web site

A $15.95 value includes State, as well. You can't go wrong there.

TurboTax and H&R Block both present $19.95 as the cost for their "Premium/Deluxe" packages, but State is not included. For Illinois, I was charged $24.95, for State. So I got hit with that, on top of the $19.95.

Which to choose?

H&R Block can charge $100 or more to do income taxes for individuals. Here is an H&R Block receipt:

H&R Block could charge you $100 or more to complete your tax returns for you

Stick with TaxACT, if you're concerned about the cost - and if you just want to be "in and out." TaxACT is quick, affordable, and reliable.

However, if you'd like more features, support, and a "brand name" company, try TurboTax or H&R Block.

H&R Block also has the obvious advantage of "brick and mortar" locations, if you ever wanted to speak to a tax representative, in person - rather than try to do your taxes "in the dark."

More Reading

PC Magazine: It's Tax Time: We Review the Boxed Software

Review: TaxCut Is Best Tax Prep Program

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