The creation of tax filing online is a genius idea. It allows people to file their taxes from the comfort of their own home.
Plus, many online tax filing programs are affordable and even free! However, not all programs are right for all tax situations.
And some are easier to use than others. Which one will you choose?
At A Glance: Our Top Picks for Filing Taxes
|Company||Federal Free*||Cost for Additional State|
|TurboTax||Yes||$40 per state|
|TaxAct||Yes||Free to $44.95 per state|
|H&R Block||Yes||$36.99 per state|
In This Article
Inexpensive Options to File Taxes Online
You’ll want to know which tax preparation websites are the best – and cheapest. As a consumer, you have several options to choose how you want to file your taxes online.
We’ll outline some of the most popular choices. Most of these have a free option, so be sure to read the details below.
* Some additional fees may apply, see sites for details.
TurboTax has been offering cheap and free tax return filing for over 40 years. Intuit acquired the company in 1993, and that was a good move.
It’s been one of the most popular online tax filing websites ever since.
Check out the different programs TurboTax has to offer. Each program has distinct features and benefits. However, they all have great things to offer.
TurboTax’s Free Edition
TurboTax’s Free Edition costs nothing. You’ll pay $0 for federal returns, $0 for state returns and $0 for filing fees.
To be eligible for this you have to meet specific requirements:
- You have to file a 1040A form
- You aren’t taking any itemized deductions
- You’re not responsible for investment income
- If you don’t own a house
- Your year didn’t include any major medical expenses
- You didn’t have any 1099-Misc income, and you don’t own a business
There is no longer an annual income limit for TurboTax Free. There are no age restrictions either. Some online tax software may only offer free tax prep if you have a small income.
These are the broad parameters for filing a 1040EZ or 1040A form. However, if you qualify, it makes you eligible for TurboTax’s Free Edition.
Note that you can take the standard deduction, as well as the EITC and Child Tax Credits with this version.
This program could work for you if you have a clean-cut tax situation, W-2 income, no itemized deductions and no other odd inclusions.
But you will need to pay to use TurboTax if you earn freelancer income, sold investments or have student loan payment interest deductions.
TurboTax Deluxe Edition
This is TurboTax’s most popular edition. It costs $40 for federal tax filing and $40 for state filing. TurboTax Deluxe has everything included in the Free Edition.
Also, this program can itemize deductions. You can add charitable deductions, mortgage interest deductions and more. Plus, they include on-demand tax help.
Their automated Deduction Finder is impressive. It will search more than 350 tax deductions to guarantee you the largest refund.
TurboTax Premier Edition
The TurboTax Premier Edition is for those with investment holdings. Also, it’s for those with real estate holdings over and above a primary home.
It costs $70 to file your federal return using this edition. And you’ll pay $40 to file your state return. With this edition, you’ll also get all that comes in the Deluxe Edition.
You will need to use TurboTax Premier in these tax situations:
- Sell stock and bond investments
- Participate in employee stock plans
- Earn rental property income
- Cryptocurrency transactions
Besides, you can import your investment information. Discount tax prep software may have you manually input all of your brokerage statements.
TurboTax Premier will help you calculate capital gains, losses, etc.–even on cryptocurrencies.
This program offers step-by-step guidance with adding new rental properties too. This addition is nice if you use TurboTax Premier every year. Bonus: you have full access to the on-demand help center.
TurboTax Self-Employed Edition
The Self-Employed Edition includes everything the Premier Edition has to file your taxes online.
It includes these additional features as well:
- Specific guidance for business owners
- Good for freelancers and independent contractors
- Guidance on deductions specific to your particular industry
- Expense tracking, mileage tracking, etc. from QuickBooks Self-Employed
- Additional guidance on standard vs. actual mileage, home office deductions, etc.
This edition costs $90 for federal filing and $40 for state filing.
TurboTax also offers a product called TurboTax Live. With the live edition, you get all the benefits of the other TurboTax Editions.
Plus, you get live answers along the way as you file and a free one-on-one review with a tax expert. They have CPAs (Certified Public Accountants) on staff.
You’ll get live tax advice from experienced experts in the field too. The Live version prices vary depending on what type of return you file:
- Basic: $50 for federal and $40 for state (see the website for special reduced rates)
- Deluxe: $90 for federal and $50 for state
- Premier: $140 for federal and $50 for state
- Self-Employed: $170 for federal and $50 for state
Of course, these programs cost more than the basic online TurboTax options, but they can be a great help for those with complicated returns. Or for those who simply want expert guidance as they file on their own.
As you can see, there is a lot to choose from with TurboTax. They have a guaranteed maximum refund program.
Also, there are guaranteed accurate calculations too. So if you find a mistake, you get your money back.
Related Post: TurboTax Review
TaxAct has been in business since 1998. They provide serious competition with TurboTax when it comes to filing your taxes online.
Here’s the scoop on the different products they have to offer. I’ll share what each one costs too.
TaxAct Free Edition*
TaxAct’s free edition is similar to TurboTax’s in that it’s free. It costs nothing to file your federal tax return but each state return costs $4.95.
This edition is limited to 1040 form filers. Remember that 1040 filers can take limited deductions. It all depends on the form they use.
Note that the 1040 form replaced the old 1040EZ form in 2018.
1040 filers have expanded options for filing. One benefit is the ability to include other sources of income.
TaxAct Deluxe Edition
TaxAct’s Deluxe Edition is for those with standard itemized deductions. It costs $24.95 to file a federal return and $44.95 to file a state return.
If you have itemized deductions, this version can work for you. You’ll want to use it if you have charitable deductions, mortgage interest deductions or a health savings account.
Some of the features of TaxAct Deluxe include:
- Access to over 300 types of deductions
- TaxAct’s $100k Accuracy Guarantee
- A personalized financial assessment (This report outlines any other deductions, etc. you may be eligible to receive)
You will also need to use this edition if you need to report unemployment income.
TaxAct Premier Edition
If you have rental properties or investments, the TaxAct Premier edition could be right for you. The Premier edition costs a bit more than the Deluxe edition: $34.95 for federal filing and $44.95 for state filing.
Some of the benefits of this version include:
- Deductions for stock gains/losses or sale of a home
- TaxAct’s $100k Accuracy Guarantee
- Help for people with foreign banks and financial accounts
- Rental property income and deductions
- Royalty and Schedule K-1 income
This version is excellent for those who earn investment income and own rental properties. Also, it’s for those who want prioritized support from the help team.
TaxAct Self-Employed Edition
TaxAct offers the TaxAct Self Employed Edition too. According to their website, it’s for filers seeking maximum deductions and year-round support. It costs $64.95 for federal filing and $44.95 for state filing.
The Self-Employed version offers everything Premier offers, plus:
- Freelance income and deductions
- Farm income and deductions
- Depreciation calculation
- Year-round support
You’ll get other benefits with this version too. One of those benefits is help with your quarterly tax payments.
This TaxAct version is specifically designed for the self-employed, to help you maximize deductions and still save money on tax filing.
For more information, check out our complete review of TaxAct.
FreeTaxUSA has been processing online tax returns since 2001. They have three different programs:
All federal tax return filings with FreeTaxUSA are free. And all state return filings with FreeTaxUSA cost $12.95.
FreeTaxUSA also has two customer service options to choose from.
The Free Edition works with all three of the tax filing programs: Simple, Premium and Advanced. It’s free to file a federal return and $12.95 per state.
Plus, you get access to customer support via live chat and email.
If you choose the Deluxe Edition with FreeTaxUSA, you pay just $6.99 and get some important upgrades such as:
- Live chat with priority support
- Unlimited tax return amendments
- IRS audit assistance
Note that if you need to file an amendment and you don’t pay for the Deluxe Edition, you’ll pay $14.99 for FreeTaxUSA to do that. So the Deluxe Edition is a great deal just for the amendments feature alone.
If you’re looking for free and easy, you might like FreeTaxUSA for filing your taxes.
For more information on FreeTaxUSA, check out our complete review of FreeTaxUSA.
There are many great choices for prospective TaxAct, TurboTax and FreeTaxUSA clients. Let’s move onto another long-standing tax preparation company, H & R Block.
4. H&R Block
H&R Block is by far the tax preparation company with the most experience. They opened their doors over 60 years ago in 1955.
This company has four different ways you can file your taxes online. By using one of them, you may be able to save money when filing your taxes.
Here’s the scoop on the H&R Block online filing fees.
H&R Block Free Online
The H&R Block Free Online plan costs $0 for federal filing and $0 for state filing. Their website says it’s best for new filers, simple filers and homeowners.
Unlike most free tax software, you can deduct mortgage interest with H&R Block.
Besides, you can deduct donations, student loan interest and child care expenses too. This difference is nice from other free products we’re discussing.
Also, H&R Block has what it calls Online Assist versions of all of their programs.
Online Assist gives you on-demand help from a tax expert, enrolled agent or CPA. If you are filing with H&R Block’s Free Version and want Online Assist, it will cost $39.99 for federal filing and the state filing is free.
H&R Block Deluxe Online
This program includes all of the features of the Free Online program. It has additional benefits as well. For instance, you can deduct taxes if you’re a homeowner.
Plus, you can deduct HSA contributions. You can also deduct charitable contributions with this version.
This low-price plan also lets you report freelancer income with basic deductions. For instance, maybe you make money with a delivery app side hustle.
The H&R Block Deluxe program costs $29.99 to file your federal return. And it’ll cost $36.99 to file your state return.
If you want to upgrade to the Deluxe Online Assist package, you’ll pay $69.99 for federal and $36.99 for state filing.
H&R Block Premium Online
H&R Block says their Premium program is best for freelancers. It’s also great for independent contractors, investors and rental property owners.
This program comes with all of the features of the Deluxe program.
H&R Block Premium includes these tax features:
- Download investment income from online brokers
- Report rental property income and expenses
- Qualified business income deductions
- Import business expenses from expense tracking apps
The H&R Block website says that this program is best for those with under $5,000 in expenses.
The cost for this version is $49.99 for your federal return, and you’ll pay $36.99 for your state return.
If you want to upgrade to the Premium Online Assist package, you’ll pay $109.99 for federal filing and the same $36.99 for state filing.
H&R Block Self-Employed Online
The Self-Employed version costs $84.99 for federal filers. It costs $36.99 to add your state return.
However, if you want to upgrade to the Self-Employed Online Assist version, you’ll pay $149.99 for federal filing and the same $36.99 for state filing.
This program is for those who are self-employed with a higher income. You’ll get full access to the self-employment tax benefits.
It’s not for smaller income side hustlers with simpler tax returns. Conversely, this program is for those who freelance as a serious business.
If you’re a freelancer and not sure which tier to choose, H&R Block starts all filers at the free plan. As your tax return becomes more complex, you upgrade to a higher package.
H&R Block Self-Employed benefits include:
- Import expenses from Stride
- Import Uber driver tax information
- Asset depreciation
- Report all tax deductions
Filers can also get unlimited tax advice via chat with this version too.
There is a nice roundup of options from H&R Block. But it seems as though they offer the most to simple tax return filers and to the self-employed.
Related Post: H&R Block Online Review
5. Credit Karma Tax
You might be surprised to see this addition to our online tax filing choices. Credit Karma has long been known as a free credit management site.
Now, Credit Karma offers online tax filing. Credit Karma Tax helps you file your federal and state taxes for free without a maximum income limit.
For instance, you can file self-employment or itemized tax returns for free. However, this platform doesn’t support part-year state tax returns or multiple state returns.
Also, Credit Karma Tax has a 100% maximum refund guarantee and a 100% accuracy guarantee as well.
And if you used H&R Block, TurboTax or TaxAct last year, you can import your information to Credit Karma Tax.
But you do need to sign up to be a Credit Karma member to use Credit Karma Tax. The good news is that Credit Karma is free.
Joining Credit Karma is a great way to be able to see your credit scores and monitor your report. Credit Karma Tax is a terrific addition to a service that’s already great.
E-file.com used to do 1040EZ filing for free. Now that the EZ form doesn’t exist, they’ve stepped up their game and added other options to the mix.
E-file.com doesn’t have as many added features and benefits of the other programs mentioned here. However, it does have one bonus: it’s cheaper.
E-file.com has three programs: Free Basic, Deluxe, and Premium.
Efile.com’s Free Basic program is free for federal filing and $28.95 for state filing. This program is best if you have W-2 income of less than $100,000 per year and no itemized deductions.
Also, E-file.com has online customer service support to answer your questions. So this may save you from needing to call the IRS or seeing a tax pro.
Don’t qualify to file with the basic program? You do have other options you can use with E-file.com.
E-File’s Deluxe program costs $24.95 for federal and $28.95 per state.
You will need to choose Deluxe Plus in these tax situations:
- File with dependents
- Deduct mortgage interest
- Report retirement income
You qualify for Deluxe if your annual income is below $100,000. Another extra perk is phone customer support.
E-file.com’s Premium version costs $34.95 for federal filing and $28.95 for state filing.
This version supports all income levels, tax creditsx and deductions. Plus, you can also use it for business and personal income.
So if you plan to itemize your deductions, this is the plan you will need.
I’d honestly never heard of TaxSlayer until a couple of years ago. A friend of my daughter’s mentioned he used it.
When I started looking into what they offer, I was surprised to learn they’ve been around since 1965.
I probably would have heard of them if I was into college football. That’s because TaxSlayer struck a deal in 2014 to rename Florida’s Gator Bowl to The TaxSlayer Gator Bowl. But that’s not relevant, so let’s move onto their products.
TaxSlayer Simply Free
TaxSlayer’s Simply Free program costs $0 for both federal and state returns.
The free version includes live phone support and free email support. But so do the other TaxSlayer programs.
The TaxSlayer Classic program costs $17 to file your federal return. Also, you’ll pay an additional $32 to file your state return.
You can use this version with all major IRS forms, including self-employment income. Selling investments and reporting rental property income qualify for this plan too.
However, you will need to choose a pricier plan to get hands-on support.
TaxSlayer’s Premium version costs $37 for your federal tax return. You’ll pay an additional $32 for your state return.
Along with the benefits of the Classic program, you get these benefits:
- IRS audit assistance for three years
- Ask a Tax Pro assistance
- Live chat technical support
This version sounds suitable for those with itemized deductions. So consider Premium if you have mortgage interest or if you have charitable deductions, etc.
TaxSlayer Self-Employed Edition
This edition is best for freelancers and independent contractors. And it’ll work for rental property owners too.
Self-Employed includes these exclusive benefits:
- 1099 and Schedule C tax deductions finder
- Unlimited phone, email and live chat support
- Year-round tax payment reminders
The cost for this package is $47 for a federal return. In addition, you’ll file your state return for $32 per state return.
Related Post: TaxSlayer Review: A Way to Get Your Tax Refund Quickly
All in all, there is a nice variety of choices from TaxSlayer. However, we still have one more company to discuss.
8. eSmart Tax
Another online tax prep company you may not know about is eSmart Tax. However, you might be familiar with their parent company–Liberty Tax.
You can choose from three programs to file your taxes online.
Note that eSmart no longer offers a free file option for basic filers. Instead, eSmart Tax users can choose from these three options.
*Note: eSmart Tax occasionally has deals where you can get ANY of their three programs for the Basic program price. Check their website for potential deals.
eSmart Tax Basic
The eSmart Tax Basic program costs $44.95 for federal filers. It’s an additional $36.95 if you want to include your state return.
This program supports these tax situations:
- Standard deduction
- Annual taxable income below $100,000
- W2 wages
- Unemployment income
- Taxable interest under $1,500
- Taxable scholarships and fellowship grants
This version works with the 1040 form, the 8853 form and schedules A and B. The website says this version is best for families with various minor deductions.
eSmart Tax Deluxe
eSmart Tax’s Deluxe version costs $64.95 for federal filers. It’s an additional $36.95 to add your state return.
According to the website, it is best suited for investors. Families should use this version as well.
Consider Deluxe when you have these tax events:
- Children and other dependents
- Investment income
- Retirement income
- Child care and education tax breaks
- Itemized deductions
- Educator expenses
- Alimony payments
Plus, you’ll have the ability to add in sole proprietor income too. For advanced business dedcutions, you will need to upgrade to the Premium plan.
This version supports forms 1040, 4562, 8829, 4136 and schedules A, B and C. So if you’re a self-employed person this might be a better version for you.
eSmart Tax Premium
The eSmart Premium version is for those who are self-employed. It has all of the features of the Deluxe version plus you can include income from real estate rentals.
Upgrade to eSmart Tax Premium for these tax situations:
- Small business income and deductions
- Asset depreciation
- Health savings accounts
- Rental property income
- Schedule K-1 income
- Taxable income over $100,000
This version costs $89.95 for federal filers and $36.95 for state filers. You can use this version for almost any tax filing situation.
Besides, eSmart Tax offers live support for its customers. They’ll help you answer any questions you may have.
eSmart Tax is lesser-known than some of the other tax prep companies. But you can get similar tax return results as using pricier software.
Also, eSmart Tax offers similar guarantees as larger tax prep websites. They promise you’ll get the maximum refund and have an accurate tax return.
Can I File Online Directly Through the IRS?
You might be wondering if you can file taxes online directly through the IRS. Yes, you can.
The IRS has a filing tool they call Free File. This tool allows you to file your federal tax return directly with the IRS.
However, they only have two versions available. One is for those who have income of $72,000 or less for the year. The other is for those who earn income above $72,000 per year.
If your income is below $72,000, you may qualify to file your state return for free. You can also get advanced calculations and hands-on guidance.
Free File Has More Than One Downfall
This could be a good tax filing option for some. Although, I see a couple of drawbacks with the IRS’s Free File program.
To me, the first problem is a big one. It doesn’t offer technical support.
If you need help filing your taxes, you may need to switch to a better platform. As a result, you lose the time using IRS Free File.
Do you have a super easy return or know a lot about the tax laws? If so, the Free File program could be right for you.
However, it’s going to require some serious work on your part. You’ll need to learn what information to include on your return.
There’s another hurdle with using Free File through the IRS. They don’t support your state return if you use the “above $72,000” version.
This means you’ll be starting from scratch as you file your state return if you earn too much.
However, using one of the paid-for versions above eliminates that issue. You’ll get the ability to transfer your information to the state form.
Choosing good tax software will save you loads of time. And time is money, as the saying goes.
If You Like Learning Tax Laws
Some people would prefer to learn all there is to learn about filing their taxes. This life skill allows them to file their taxes for free every year.
Do you find learning that type of content interesting? Are you okay with educating yourself on tax law changes every year? If so, it could be beneficial to learn how to do your return.
Yet, if you’re like me, you’ll find that type of information mundane. In that case, you may be better off leaving your tax returns to the experts.
Use a service like the ones mentioned above. Or find a local provider to make your life easier or hire an online tax pro to help prepare your return.
Decide What’s Important To You
Only you can choose whether to use a free program offered by the IRS. Or if you’ll want to use a free version provided by a tax company.
However, if you’re not able to file for free, you’ll have to decide what’s important to you. Is it worth paying for the ease and convenience that the tax pros have to offer?
As for me, I’ll pay for convenience every time. Tax pros save me hours of work about a subject I don’t know much about.
Filing my taxes is one task I’ll leave to the experts. Yes, I have to pay for the service.
But it’s worth the money to me. I don’t have to learn about tax law changes each year.
I also have more peace of mind that my tax return is accurate and doesn’t overlook any tax deduction or credit.
We’ve shared lots of information on the various online tax prep companies for you to file your taxes online. As you can see, there are many cheap – and free – ways to file your taxes online.
Which one will you choose? Have you tried any of the companies mentioned here in the past?