TaxAct Review 2021: How it Works | Free & Low-Cost Tax Prep

Taxact Review
image source: www.taxact.com

While TaxAct is often misunderstood, or better still, taken as the “discount” option in comparison to other tax prep software, it realistically offers a lot more than anticipated. This makes TaxAct review a necessity, so intending users can be pre-informed of users experience and exposed to all the software’s benefits and of course, cons.

Thus if you’re looking to be sure of how TaxAct works and its claimed free and low-cost prep, this post will totally address your concerns

In this read, I will do a thorough review of TaxAct and also help you understand how the tax prep software works, its features, its legitimacy or not and the rationality of subscribing to the platform. I will further compare other similar platforms to TaxAct so you are informed enough to decide which tax prep app works best for you.

All I ask is that you read through with all meticulousness and utilize the information contained herein to make better decisions about which tax prep software to subscribe to. In the meantime, the table of content immediately below should enable you navigate easily through this read.

Is TaxAct really free?

Majorly, TaxAct is completely free for active service members of the program, and there is a $0 option for anyone else.  

How much does it cost to use TaxAct?

With the TaxACT Desktop Edition, there is a $9.99 e-filing fee for all state returns (except New York) (except New York).

Is TaxAct a good service?

TaxAct is an easy-to-use, inexpensive app that just about everyone can use. With extra features and plans for each budget,  TaxAct is a good choice for first-time filers or people who want a full online filing service.

Which free tax filing service is best?

Some of the best free tax software include;

  • H&R Block Free Edition: Best overall.
  • TurboTax Free Edition: Most user-friendly.
  • TaxAct Free Edition: Best for complex returns.
  • TaxSlayer Simply Free: Cheapest paid products.
  • FreeTaxUSA Free Edition: Best comprehensive service.

Which is better, TurboTax or TaxAct?

TaxAct may also be a better choice even if you are in a more complicated tax situation but understand all the forms and schedules. TurboTax is more expensive but maybe a better choice for people that need to fill out multiple schedules and that need more guidance in getting their largest refund possible.

About TaxAct

TaxAct is a tax preparation software company based in Cedar Rapids, Iowa that is recommended by the IRS. Founded in 1998, the company is now one of the most significant names in e-filing software.

The tax prep software company offers two product formats: TaxACT Online which is web-based tax preparation, and TaxACT Desktop. There are also free mobile app called TaxACT Express which was released on January 17, 2014. The app is available for iOS and Android.

TaxAct also has several online plans: Free, Basic+, Deluxe+, Premier+ and Self- Employed+ and Pro and offers a Free version for basic returns.

Furthermore, in March 2018 TaxAct Online Freelancer Edition was awarded the title of “The best tax software for independent contractors” by Business Insider

TaxAct reviews; Legit or Scam

For some users, TaxAct is a reputable company and very user friendly. It is also claimed to have very accurate tax filing, that gets you the most refund in a timely manner.

The company is a very legit software one and has even been recommended by the IRS.

TaxAct Review: How it Works

TaxAct e-filing works absolutely for you if you want unpaid federal and state returns as an active member of the military; You have expert knowledge on e-filing; prefer a user-friendly, easily accessible interface; find features of other similar tax prep software confusing.

On the flip side, you may want to avoid TaxAct if you; want an icon for calculating your deductible contribution as found on similar web prep software; want individualized advice from CPAs; need a more affordable tax prep software; appreciate good customer service greatly.

How to Subscribe

You need to select your product in order to get started with TaxAct, and then you will be asked to open an account. Provide your email and TaxAct will give you a code to build your account that you can use. You’re going to create a password, enter a phone number, and set up security issues. As you do with several other tax items, it’s a phase that is a little more complicated than just getting started.

You can, however, start your return without entering payment details. Importing your previous year’s 1040 and reviewing the details is fast. You should start digging into this year’s situation once you’ve done that.

Other Products TaxAct Offers

Depending on your requirements, TaxAct also sells other items. Company tax reporting forms exist, including assistance filing for a C-Corp and filing as a nonprofit. In preparing client tax returns, there is also enterprise software developed for tax professionals to use. These products range from $59.95 upwards.

Options for Refund

Like similar tax prep, TaxAct helps you to select from multiple forms to obtain your refund. Some of the possibilities include:

  • Depositing directly
  • Paper check
  • Applying taxes for next year
  • Buying U.S. savings bonds
  • Prepaid card from American Express Serve
  • In the Refund Marketplace, another option is to use your refund, which affords you gift cards from a number of retailers.

Synchronizing

You can import your tax records from previous years, and if you want to get your tax refund deposited directly into your account, which is the easiest way to get your money, you’ll have to include your bank information. You can also log into your account from a mobile device and begin operating from a different location on your tax return.

Accessibility for Phones

TaxAct updated its mobile app, TaxAct Express, last year, and now it is much simpler to use. To capture important documents, you can use your computer, and you can switch between mobile and desktop versions. It also features support for Touch ID and Face ID.

There are some characteristics, however, that TaxAct Express doesn’t have. For example, some of the forms and schedules that come with more advanced circumstances can not be managed, so even though you start them with the mobile app, you can need to turn to the desktop to complete your taxes.

Customer Service

TaxAct has a searchable knowledge base and can get support with email, chat, or telephone from all filers. Paid models have unlimited in-app email support, and when you purchase Deluxe + and above, you can get unlimited phone support. Plus, you can get a dedicated phone line, along with screen sharing capabilities, when you get up to the Premier+ stage.

Understand that on the phone, you will not get tax advice from officials. They’ve previously prepared taxes, and it’s a plus that they’re all committed to tax planning, but mostly they can only help you navigate the app.

TaxAct Review: Free & Low-Cost Tax Prep

In general, TaxAct’s products are less costly than TurboTax and H&R Block comparable products. And price is an important factor, especially for individuals who need sophisticated tax software that can run $100 or more elsewhere if you take into account the cost of preparing a state return.

A free version of TaxAct is available that allows you to file Form 1040, but not Schedules 1, 2 or 3. In the course of disclosing items such as business profits, alimony, deductible student loan interest, some retirement payments, alternative minimum tax, dependent care expenditure credit, the Lifetime Learning Credit or the Saver’s Credit, these schedules are important.

That means you will need to upgrade to a paid version if you plan to itemize, are a landlord, freelance or run a small business, or have any other circumstances that require filing one of these separate schedules.

How much is the TaxAct price?

The formula of TaxAct is equivalent to that of many other tech firms that file taxes. For a federal tax return, you pay one fee, and an extra price for a state tax return. You pay per state, which means that if you need to file tax returns for two states, for each of those two state filings, you will have to pay fees.

Through their Free Plan, TaxAct provides free state returns. State returns are an extra $54.95, for the Deluxe+, Premier+, and Self-Employed+ plans.

Here’s a short rundown of what each plan costs and some guidance as to which plan will better fit the needs of a filer. Note: TaxAct will adjust prices during the year, like many tax software companies, and can run specials during the tax season.

Free:

$0 for state and federal returns. The Free Plan is for filers who have the most basic criteria. You may be single or married, and this package includes the retirement income. This package can be used for those with dependents and college expenses, too.

Deluxe+:

$54.95 for federal returns, 54.95 dollars for state returns. For homeowners and those wishing to demand deductions, modifications, and credits, the Deluxe+ package is intended.

Premier+:

For premier; $79.95 for federal returns, 54.95 dollars for state returns. This strategy is for filers who have investment and rental properties.

Self-Employed+:

$109.95 for federal returns, $54.95 for returns from the state. This arrangement is for you whether you’re self-employed, an independent contractor, or a sole proprietor.

If you’re an active service member, under each of his four plans, TaxAct provides free federal and state e-filing.
For service veterans, TurboTax also offers free federal and state returns.

For federal returns, TaxSlayer offers free e-filing for service members but fees for state returns, and through its Military OneSource network, H&R Block provides free options.

Table Representation of TaxAct price

PlanDescription
TaxAct Free Federal Return: $0
State Return: $0
TaxAct provides a free filing service for both federal and state taxes if your tax situation is very easy. You can import your W-2 quickly and easily and get started.
With this product, you can not itemize any deductions, and you are limited in terms of available forms and schedules.
TaxAct Deluxe+ Federal Return: $29.95
State Return: $39.95
We are beginning to get into slightly more complicated territory now. You can access everything in Basic+ and file Schedule A and Schedules 1-6 with the Deluxe+ version of TaxAct tax prep software. It also includes the capacity to claim credits for education and expenses for dependent care.
TaxAct Premier+ Federal Return: $39.95
State Return: $39.95
This can be a smart alternative for many individuals who aren’t self-employed. It provides access, including those you can get with Deluxe+, to many of the most popular types and schedules. You will also be required to file Schedules D and E, which deal with investments in stocks and rental property.
Not only that, you’ll further be prioritized and have access to in-app chat and screen sharing when you request help.
TaxAct Self-Employed+ Federal Return: $74.95
State Return: $39.95
You get most of what you need with this tax package as long as you’re a sole proprietorship, S-Corp, or LLC. To make sure you claim all your business expenses, Also, you can use the Deduction Maximizer, and you will get help with your Schedules C and F.
Furthermore, you can even get a financial evaluation and year-round tax planning help on top of that. There’s also committed support, including options for screen sharing.
Taxact Review

Pros & Cons of TaxAct

PROSCONS
Variety of low-cost items; At low price points, you can choose from a variety of products, including a free filing option.You will find information on TaxAct’s FAQ page about going through an audit, but if you want more assistance, you need to pay $49 at the time you register. Later, there’s no way to add Audit Protection.
Access to C-Corp and nonprofit filing assistance for business tax forms is a nice bonus.Fewer frills; TaxAct does not have it if you need a little more hand-holding from your tax preparation software.
Tools that can be used year; round The inclusion of year-round tax assistance can be a value-add for the Self-Employed+.The interface is simpler, and the flow of questions, like TurboTax and H&R Block, is not as smooth as some other decisions. Although customer service is adequate and does the job, it is not as complete and accessible as some other businesses. Less robust customer service.
Screen sharing feature; It is great that you can get access to the screen sharing option when you pay for the higher-end models. This makes it possible for you to explain your situation to the representative better.State returns cost more; with TaxAct, state returns are more costly once you get to a certain amount. Don’t forget to compare costs using returns from the state.
The recently added Marketplace can be a good place to find gift cards from a variety of retailers for multiple refund options.
Taxact Review

TaxAct and other tax preparation software

TURBOTAXH&R BLOCKTAXACT
Pricing

Ease of use

Support options
On the higher end.

Q&A user flow is one of the best.

Live video help from a tax pro, online FAQs.
On the higher end.

Clear and helpful interface.


Live video help from a tax pro, online FAQs, 11,000 locations.
Good value pick.

Simpler, less focus on design.

Screen sharing, online FAQs, phone and chat.
Begin hereClick to beginGet started

Conclusion

Finally, we trust all information contained herein will provide you with leverage to make more informed decisions about what tax prep software to subscribe to.

Whatever your decision, we ask that you prioritize your convenience.

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