Recently, I shared my reflections on 5 years of tax return filing with TaxAct. I am a big fan of their online platform but am tired of their dramatic increases in pricing in recent years. Their current pricing is $110 for federal and $55 per state (self-employed option). It's time for me to find something new!
Search Criteria
Our taxes are quite complex, and I'm by no means a tax professional. As such, listed below are my criteria for finding a replacement for TaxAct:
- Allow importing prior year tax data. Ideally, this would be a direct import from TaxAct, but uploading a pdf tax return may work as well.
- Offer support / filing options for someone with my tax needs (Schedule C, investments, etc.)
- Be cheaper than TaxAct.
- Must have a Q&A format that enables building my tax return without being confused by all the tax code jargon.
- A reputable company with which I feel is safe to work.
Review of Options
Below is my review of the available options I could find online:
- H&R Block online
- Slightly cheaper than TaxAct, but still similar pricing.
- $105 federal, $45 state for self-employed package.
- Verdict: no, although it is intriguing that TaxAct pricing has gotten more expensive than H&R Block. This was definitely not the case 5 years ago when I did a deep-dive comparison.
- TurboTax
- Still more expensive than TaxAct.
- $120 federal, $50 state for self-employed package.
- Verdict: no.
- Etax.com, Efile.com, Eztaxreturn.com, and OLT
- All significantly cheaper than TaxAct, but I am not as familiar with these companies.
- Verdict: no.
- CreditKarma and FreeTaxUSA
- Both of these are significantly cheaper than TaxAct.
- I am familiar with both of these companies and would have no issues trusting them with my taxes.
- However, they seem to be too "bare-bones" for me and/or do not provide the level of service which can support our complicated tax returns.
- Verdict: no.
- LibertyTax and Jackson Hewitt online
- Similar to H&R Block, these two services are the online filing option for brick-and-mortar tax preparation companies. However, they seem to have a less prevalent online use/presence compared to H&R Block.
- While their pricings are much less than H&R Block and TaxAct, pricing is still higher than the option below.
- Also, all things being equal, I tend to give preference to online-only companies since their operating costs/fees seem to be lower and delivered value higher.
- Verdict: no.
- TaxSlayer
- Pricing is currently $47 federal and $39 state for self-employed filing package.
- TaxSlayer seems to hit all of my required search criteria: reputable, supports my tax needs, allows importing via pdf upload, and solid support from a Q&A format for compiling my taxes.
Conclusions
In my case, TaxSlayer seems to emerged as the best option for our family's tax return filing in our move away from TaxAct. Once 2020 tax year return options begin popping up on the TaxSlayer site, I plan on starting to upload my prior year information in preparation for next April.
Several closing remarks on this exploration:
- Companies must always balance the need to increase pricing from year-to-year due to inflation with the impact it will have on customer satisfaction and loyalty. In my case with TaxAct, the price increases just simply seemed too ridiculous.
- From a consumer perspective, it can be easy for us to feel locked into certain financial accounts and platforms. However, we should never feel afraid to walk away because believe me, there are PLENTY of other options out there!
***Photo courtesy of https://flickr.com/photos/185607583@N05/49106655937/in/photolist-2hPorXF
