TurboTax 2017: Is it the Best Option for You?
TurboTax is one of the most well-known online tax filing softwares, and with good reason. It’s a full-featured option that takes you through your taxes step by step. Though it’s more expensive than other options on the market, it can be a good investment for those who have never DIY filed before, or those with a more complicated tax situation.
Every year, the companies that provide tax e-filing services like TurboTax and H&R Block tweak their products, not only for the latest tax laws, but to improve features, making the process of tax filing easier. I took a look at TurboTax to see what changes the newest edition has to offer.
The first thing I noticed with TurboTax is the wide variety of products they have available. This year, TurboTax is offering four options. It starts with the Federal Free Edition, which will let you file a 1040EZ or 1040A for free. The most expensive option, Self-Employed, offers many more forms for filing but costs $89.99. Most tax filers will find their needs fit somewhere in between the two.
One excellent feature of TurboTax is that you can start off your filing as a free filer. The software will guide you through your tax situation. And if you encounter forms you need but that aren’t included in your edition, you can always upgrade. You never pay until the very end of the process, either way.
So what can you expect from each edition of TurboTax? This helpful chart breaks down all the details. But essentially, you can only file the most basic forms with the free edition. With Deluxe, which costs $34.99, you can file many more deductions and credits. In fact, Deluxe gives you access to most of the credits and deductions individuals claim, including deductions for dependent care, educational expenses, and your mortgage.
If you have rental property or significant investments, the Premier version may be what you need. It costs $54.99, and gives you access to additional profit or loss forms. The Self-Employed version will work well for contractors, freelancers, and solopreneurs. It costs $89.99.
Keep in mind that each of the paid versions requires an additional fee of $36.99 per state to file your state taxes. That could add up quickly if you need to file taxes in more than one state! But TurboTax automatically transfers your federal tax information over to your state taxes, making the filing process a breeze.
What the process looks like
So what does the process of filing your taxes with TurboTax actually look like? It depends on what type of experience you prefer. You can have the software walk you through every potential type of income, credit, and deduction. It’ll just ask you all sorts of questions, and then move through the forms based on your answers.
If you’re already comfortable with filing your own taxes, though, you can tell the software what you want to work on. This can save you time. But be careful here: you don’t want to overlook any potential deductions that you didn’t know about! TurboTax is always up-to-date on the latest tax laws, so you may be eligible for credits or deductions you haven’t considered.
TurboTax’s sleek interface and easy-to-use question-and-answer system is what sets it apart from some of the less-expensive tax preparation software options. You can even automatically pull your information from last year’s taxes, and can import W-2 information from certain companies.
Here’s what the TurboTax interface looks like:
When you click into one of the top tabs, the software will give you an option: go through everything step by step, or choose what you work on.
If you decide to choose what you’ll work on, you can click into individual options on your own. If you have the software guide you through all the sections, you’ll go through more Q and A. Your answers will determine where the software takes you next.
Here’s what the section for business income and expenses looks like:
In each section, you can choose whether you’ll go through that entire section, or just work on parts. For instance, under the Farm and Income Expenses section, you can work through the whole section, or just do Farm Rental Income and Expenses.
The whole process works just like this. If you choose to let the software guide you, you’ll first work through personal information, then business income and expenses. Then, it’ll take you through personal income and expenses, and, finally (the good part!) deductions you can take.
Besides being an easy-to-use software, though, TurboTax comes with a variety of other features, including:
- Self-Employed ExpenseFinder: This is the same ExpenseFinder used in QuickBooks. It basically walks you through all the types of expenses you might be able to write off, so you don’t miss anything. As a Self-Employed person, every write-off counts!
- Mobile File: TurboTax lets you file from a desktop, but it also has a slick mobile interface so you can file online from your tablet or phone.
- CompleteCheck: Like most tax software options, TurboTax guarantees its math. This isn’t the same thing as guaranteeing you’ll come out on top in an audit. But if its calculations aren’t accurate, it’ll deal with the IRS and refund you to compensate.
- Tax Help: You can get access to live tax professionals, depending on which version of TurboTax you use. You can chat online, or do a mobile screen share with a tax expert who can answer you specific questions while guiding you through the process. You can also find answers to more common questions in the forums.
- Audit Support: With Audit Support, you can get one-to-one guidance from a tax pro, get answers to audit-related questions, and get assistance preparing for an audit. If you get an audit letter after you file with TurboTax, you can just visit their Audit Support Center for more help.
- Audit Defense: This isn’t the same thing as Audit Support. When you file your taxes, you can chose to pay extra for Audit Defense. This is a full-service audit representation by a ta professional. If you want to know that you won’t have to deal with the IRS directly should you be audited, Audit Defense might be worth your while.
- Free File Storage: TurboTax will store your prior years’ tax information for you, so you can always access the PDF copies of your tax return when you need to.
With all these features and its incredibly simple-to-use interface, TurboTax could be a great option if you’re looking for DIY tax software. Yes, there are other good options available. But many of the cheaper options don’t offer as much hand-holding as TurboTax does. So if you’re less comfortable with your tax situation — or if you have a slightly more complicated situation — TurboTax may be the right software for your needs.
On the other hand, if you know what forms you need to file and what deductions are right for you, TurboTax may be more expensive than you’d prefer. In this case, other tax preparation options, including H&R Block or TaxACT might be a better option for you.
Consumerism Commentary is an authorized affiliate of Intuit. Intuit did not compensate Consumerism Commentary for this review.