Compare TaxAct vs. TurboTax. See pros and cons of TaxAct vs. TurboTax and easily decide which accounting software is right for you.
The battle to claim the title of “Best DIY Tax-Prep Program” has been raging between TaxAct and TurboTax for quite some time. But, which one of the two can objectively be called the better one? Well, let’s find out in our “TaxAct vs. TurboTax” battle.
TaxAct Vs. TurboTax Accounting Software Comparison
Both, TaxAct and TurboTax offer a range of paid products that provide capabilities in line with their specific pricing. You also have so-called free versions. However, they’re only free in that you don’t have to pay an extra fee for filing state returns. In fact, TaxAct only offers free state-returns for the current year. If you want the previous year’s returns, you’re going to have to pay around $10.
Now, coming down to the actual discussion, we found that itemizers will have a great time with the Plus Version from TaxAct and the Deluxe Version from TurboTax. However, if you’re self-employed, an investor or someone who earns from rental property, you will have to opt for TaxAct’s Premium Version or go for TurboTax’s Self-Employed Version. They’re both quite effective at doing some heavy-duty work in this regard.
Now, when it comes to downright pricing, TaxAct seems to be cheaper on an overall basis. TurboTax, however, charges $100 for its fully-loaded version. The equivalent product from TaxAct cost’s half of that.
Here’s a breakdown of the pricing and capabilities:
|Federal Forms: 104EZ and 1040A||Federal Forms: 104EZ and 1040A|
|Deluxe: $54.99, Premier: $79.99, and Self-Employed: $114.99||Plus: $30 and Premium: $45|
|State Return Prep: $29.99 on the free version and $39.99 on the paid versions||State Return Prep: $0 on the free version and $35 on the paid version.|
Features and Usage
As we always say, only the IRS’s calculations are right and your tax-prep program needs to match those calculations. However, a huge part of getting the right figures is dependent on you feeding the right data into the program, which, in turn, depends on how easy to use said program is.
So, how do TurboTax and TaxAct compare in this regard? Let’s see.
TurboTax has always been seen as an easy to use program. As mentioned in one of our earlier comparisons, it comes with an interview-like Q&A interface. You answer the questions and eventually end up in the form filling section, where the data gets entered according to the answers you’ve given. The language is quite simple, which allows most users to make sense of what’s being asked.
Plus, you can always skip the Q&As if you already know what needs to go into the forms.
As for features that are available on both programs, you have all kinds of import options to boost the speed at which your W-2s are processed.
TurboTax, however, offers an extra feature called “ItsDeductible” on all three versions. The feature is actually a standalone app that allows users to determine what’s deductible and what’s not. In fact, the Self-Employed version even comes with a feature that allows users to link their bank accounts and scan expenditures to identify deductibles.
As for TaxAct’s interface, it is quite basic, but does the job. You have the ability to import the previous year’s returns. Of course, you’ll have to pay around $10 for that. You also have a donation assistant, a W-2 import, and a range of calculators and planning tools.
Then, there’s a free mobile app that helps out with extremely simple tax calculations and situations. Let’s just say you really don’t need this app and it’s a wonder why TaxAct even offers it.
TaxAct offers a fair bit of support for users who’re new to the program. You have a banner-like notification area that keeps you notified about your status with regard to the return process. However, we would say that TaxAct still needs to catch up with TurboTax in the support department.
This round of TaxAct vs. TurboTax goes to TurboTax. It enjoys an intuitive interface and the process is streamlined. Plus, we found it easier to use on an overall basis. TaxAct is just too basic.
TurboTax offers excellent user support. It boasts an extensive knowledge base that is linked to a very enthusiastic user community as well. The higher versions even come with the SmartLook feature, which is basically an add-on that allows you to interact with a professional via video. The professional has a view of your screen and this allows him/her to guide you more accurately.
In fact, now you can even schedule an appointment with the expert according to your convenience.
Now, TaxAct also offers a fairly extensive knowledge base to help its users out too. You can search for all kinds of tax related solutions and answers. However, it isn’t as good as what TurboTax provides. But, then, you do get email and phone support, which sort of plays a compensatory role.
So, it’s not hard to determine that we’re, again, going with TurboTax in this round of TaxAct vs. TurboTax as well. It is simply the better one of the two in the customer support area. It has a superior knowledge base and you can interact with experts who can see your screen and provide accurate guidance. TaxAct, on the other hand, still uses an “old school” approach.
Now, before we give you the verdict, we’re going to discuss a few things.
Firstly, remember that TaxAct is significantly cheaper than TurboTax. So, if you want something affordable, TaxAct is definitely something you should be looking. It offers, more or less, the same kind of functions at a much lower price point.
Now, having said that, TurboTax is clearly the more superior one in terms of, let’s say, everything. It just offers a whole lot more. Some of the key components that give it an edge over TaxAct are the usability, interface, and the extensive knowledge base. In other words, you get what you pay for with TurboTax. There’s no holding back here.
So, from a purely objective point of view, we think TurboTax wins the overall TaxAct vs. TurboTax battle.