TaxAct is likely to appeal to cost-sensitive customers filing their 2015 taxes online. Prices are as low as or lower than those of competitors, and many taxpayers will be able to file both federal and state taxes for free.
quick facts
- Free option for federal and state returns
- Identity recovery and improved security
- Paid options for more complex returns
Using the free version
You’re likely to do just fine with the free version if:
- Your income is from employer(s) that send you W-2 forms.
- You can file a Form 1040A or Form 1040EZ.
- You did not receive freelance income.
- You didn’t sell stock.
- You will be better off taking the standard deduction than itemizing.
- You made less than $100,000.
For millennials working for regular wages and possibly paying off student loans, without other financial complications, a free program can be a simple way to put tax-filing behind you and get a refund on its way.
TaxAct’s interview-style questions can help users determine whether the free programs are suitable or if they need to upgrade.
- What’s free: You can file 1040/EZ/A; state filing is also free.
- Basic ($9.99) – This allows you to import last year’s data and includes unlimited telephone support. (State is an additional $9.99.)
- Plus ($14.99) – This is the most popular version. It’s best for those who itemize, including homeowners and investors. It’s set up to help maximize deductions and credits. (State is an additional $14.99.)
- Premium ($21.99) – This version is aimed at freelancers, self-employed people and other contractors. It includes depreciation tools and can import stock data. (State is an additional $14.99.)
Using the paid version
If you’re looking for personalized service, you’ll need an upgrade. The price you pay is the one in effect at the time you initially registered (some other tax programs charge the price being offered on the date you actually file).
The paid packages offers “identity recovery” help from InfoArmor if a customer discovers someone has already filed a tax return using his or her taxpayer information. The service helps customers navigate the steps they must follow to address taxpayer identity theft. Such thefts can take months to resolve, delaying any refund and also putting the victim at risk for having credit accounts opened using the stolen information.
While the prices listed here are accurate at time of publication, note that some tax programs’ prices fluctuate during the tax-filing season. It’s a good idea to verify costs before purchasing.
Other considerations
The programs are available online (where software and your data are stored on a website) or in versions you download to your computer that are priced a little higher: Basic is $19.99; Plus, $29.99; and Premium, $39.99. State downloads are $14.99.
The software is designed to provide a seamless experience whether you’re working on taxes on your smartphone, tablet, laptop or desktop. (Just please, please tell us you’re not using public Wi-Fi.)
This year’s version has stronger password requirements, multi-factor authentication and updated security questions — yes, it can be a hassle, but it makes things much harder for would-be thieves, too.
If community forums and online resources are important to you, you might prefer using a program with more support.
How you can get your refund
Filers can choose direct deposit, a paper check, U.S. Savings Bonds or an American Express Serve card with the refund loaded onto it. For customers without a traditional banking relationship, this can be a real benefit; Serve has some of the lowest fees around.
Bev O’Shea is a staff writer at NerdWallet, a personal finance website. Email: boshea@nerdwallet.com. Twitter: @BeverlyOShea.
Image via iStock.
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