The Best Tax Software: 11 Amazing Paid and Free Options





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It’s easy for the prospect of tax season to overwhelm small business owners. Do you have all the necessary documents? Are you capable of filing your own taxes, or can you afford to hire a tax professional? Do you have any idea what you are doing?

Fortunately, you don’t have to study a stack of business finance books to manage your own taxes thanks to a variety of affordable tax preparation software options. Unsure what is the best tax software for your small business? We’ve broken down all the details about the top tax software companies.

Our Methodology to Choose the BEST Tax Software

Choosing the right tax software is critical for individuals and businesses alike, as it greatly simplifies the process of preparing and filing taxes. Here’s a guide to the criteria for selecting the best tax software, with each rated on a scale of one to ten, with ten being reserved for the most important factors.



  1. Ease of Use (Importance Scale: 10/10)
    • User-friendly interface and navigation.
    • Clear guidance and step-by-step instructions.
  2. Accuracy and Compliance (Importance Scale: 10/10)
    • High accuracy in calculations.
    • Updated with the latest tax laws and compliance requirements.
  3. Filing Options (Importance Scale: 9/10)
    • Support for different filing statuses and tax situations.
    • Options for both federal and state tax filing.
  4. Help and Support (Importance Scale: 9/10)
    • Access to tax professionals or customer support for queries.
    • Availability of resources like FAQs, forums, or tutorials.
  5. Cost-Effectiveness (Importance Scale: 8/10)
    • Competitive pricing with clear value for the features provided.
    • Free versions for basic tax filing needs.
  6. Security (Importance Scale: 10/10)
    • Strong security measures to protect sensitive personal and financial information.
    • Data encryption and secure storage.
  7. Import and Export Capabilities (Importance Scale: 7/10)
    • Ability to import data from previous years or other financial software.
    • Export options for saving and transferring data.
  8. Audit Support (Importance Scale: 8/10)
    • Assistance in the event of an audit.
    • Availability of audit defense services, either included or as an add-on.
  9. Efficiency and Speed (Importance Scale: 7/10)
    • Fast processing and quick e-filing options.
    • Minimal delays in completing and submitting tax forms.
  10. Multi-Platform Accessibility (Importance Scale: 6/10)
    • Accessibility on different devices, including mobile compatibility for on-the-go filing.

Choosing the right tax software is a decision that holds profound implications for your business’s financial health. A careful appraisal of each of these aspects in relation to your business requirements will steer your investment in the right direction.

best tax software

Best Tax Software

To help each of our readers select the best tax software, we’ve highlighted 11 of the most popular tax software products available this year. Based on your own tax needs, it should be simple for you to evaluate the details and choose your best option for filing taxes online.

1. H&R Block


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Touted by experts as one of the best tax software options, H&R Block’s online platform offers multiple ways to file taxes, including e-filing and assistance from a tax professional. H&R Block’s streamlined user interface is simple to navigate, and the software features comprehensive explanations of every tax form, as well as step-by-step guides to help users navigate their individual tax situations.

Many users filing simple returns will qualify for the H&R Block free filing option, which includes the ability to import the previous year’s tax return from another provider. Those with more complex tax returns can choose from four paid tax-filing software tiers that cover more tax forms and offer additional features.

While H&R Block is known for the tax expertise provided by its in-person professionals, online tax filers also can benefit from the additional oversight. H&R Block’s online users can opt for a Tax Pro Review, in which a tax professional will review a tax return after an online user has prepared it, checking for errors or omissions.

H&R Block Pros

Trusted brand, free version for simple returns, expert assistance available to ensure accuracy.



H&R Block Cons

More complex pricing tiers, fewer free options.

 

2. TurboTax

Tax preparation starts with properly filling out a W4 form, and the TurboTax online tax software offers help from the beginning with its free tax withholding calculator. Of course, TurboTax does so much more than that. This online tax software has been cited as the best option for users with investment income since it helps report the sales of investment securities and funds earnings, as well as other investment services. TurboTax users can even import investing gains and losses from a variety of sources.

TurboTax’s wide range of tax-filing products aren’t the least expensive tax software options, and the service is only free for those with the simplest tax returns. That excludes freelancers, small business owners and any other taxpayers who need to enter details from a 1099 form. TurboTax is, however, free for active duty members of the military, as well as reserve and National Guard members.



Regardless of the cost, TurboTax is one of the most popular tax software tools in large part because of its ease of use. The program’s question-based interface leaves users feeling as though they’ve just met with an experienced tax professional who knew all the right questions to ask.

Turbotax Pros

Free withholding calculator, great options for investment income, easy to use interface.

Turbotax Cons

A more expensive option, only free for simple returns and military members.

 

3. TaxSlayer



One of the more affordable tax software options, TaxSlayer is popular among freelancers thanks to its range of affordable products for self-employed taxpayers. In fact, TaxSlayer’s most expensive tier for self-employed users costs just $55, and it includes live chat assistance from a tax pro and estimated tax payment reminders. Independent contractors with simple returns even can enjoy a free filing option.

TaxSlayer might not be the first option people think of when they consider tax software programs, but the product is based on tools used by accountants for more than 50 years, and it’s been a trusted provider of online tax preparation since the 1990s. Not only does TaxSlayer feature a thorough outline for common 1040-related topics, but it also includes a searchable database of help files updated for the current tax year, as well as plenty of other guidance.

While TaxSlayer is highly rated by users, tax filers should be aware that only the most expensive tier offers tax advice and assistance from a professional tax preparer. All versions do, however, offer free technical support via phone or email. Still, TaxSlayer is a solid choice for freelancers and small business owners on a budget.

TaxSlayer Pros

Affordable pricing options, live chat assistance, searchable database of current tax topics.



TaxSlayer Cons

Professional tax assistance is only available to the top-pricing tier.

 

4. E-file

Looking for tax software offering discounts and promotional pricing? E-file users take advantage of special offers throughout the year, making it a great option for budget-conscious tax filers. Plus, the online tax software is so easy to use, those with simple tax returns can file electronically in less than 15 minutes.

E-file’s basic interface allows users to import their prior year’s tax return, and it features a sidebar with guidance, tips and support. The software saves users’ progress as they prepare their tax returns, and they can opt to either file taxes electronically or print and mail their completed tax returns. Users also can access additional phone or email assistance for a fee.



The E-file tax software offers free federal tax filing for simple returns and low-cost filing options for more complex tax returns. Keep in mind, however, that the platform offers fully-DIY tax filing and does not feature additional support from a tax pro. Regardless, E-file is a great option for tax filers with more complicated situations who don’t want to pay a higher premium.

E-file Pros

Year-round discounts and coupons, efficient and easy tax preparation, low-cost complex tax returns.

E-file Cons

No professional assistance, the included free filing is only for simple returns.

 

5. TaxAct



A useful software product for small business owners and self-employed tax filers, as well as any other taxpayer, TaxAct features a variety of tools to assist entrepreneurs, contractors and users with multiple income streams. In addition to various pricing plans for tax situations of ranging complexity, TaxAct offers a calculator that helps users estimate their taxes before completing any official forms. Plus, TaxAct even guarantees a maximum refund of up to $100,000.

TaxAct’s pricing tier for self-employed filers includes forms for freelance income, including the 1099-NEC, farm and business income, as well as depreciation calculations. The same plan also covers stocks, the sale of a home and rental property income. Plus, TaxAct offers free federal and state returns for all active-duty service members through the TaxAct military landing page.

Customer assistance really sets TaxAct apart from its competition. The online tax software provides every user, regardless of pricing plan, free access to its Xpert Assist tax assistance through April 7, including a free professional review of returns before filing.

TaxAct Pros

Affordable tools for self-employed filers, maximum refund guaranteed, superior customer service, and free professional reviews.



TaxAct Cons

State returns cost more and poor audit support.

 

6. Jackson Hewitt Online

Many taxpayers who need to file multiple state returns choose Jackson Hewitt Online as the best tax software because it offers unlimited state returns for a single flat fee. In fact, for just $25, Jackson Hewitt online users can file as many state and federal returns as they need.

Of course, Jackson Hewitt is known as a trusted provider of tax services thanks to the multitude of pop-up shops that appear in shopping centers and other popular locations during tax season. But the brand also represents a robust software product that helps users file their taxes online from the comfort of their own homes.



Choosing to file taxes using Jackson Hewitt’s software doesn’t mean tax filers are on their own, however. The products feature comprehensive assistance from a virtual tax pro, as well as IRS audit assistance and in-person customer service.

Jackson Hewitt Online Pros

Trusted tax professionals to ensure accuracy, unlimited returns for one flat fee, and virtual tax assistance.

Jackson Hewitt Online Cons

Refund advances only for in-store customers, and promotes pricier products.

 

7. Liberty Tax

Looking for an alternative online tax preparation software product from a respected brick-and-mortar tax service? Liberty Tax software is a great option for taxpayers who trust the brand but want to save some money by filing their own taxes online. While it’s not as inexpensive as Jackson Hewitt’s online tax software, Liberty Tax features a useful review tool, and its mobile app lets users complete simple reviews on their smartphones.

Liberty Tax users appreciate the website’s quick loading speeds, as well as its simple and clean interface. Liberty Tax’s online software lacks, however, the state-of-the-art interface offered by TurboTax and other competitors. It also lacks much of their guidance, which could hinder taxpayers from entering the various income, credits and tax deductions they might need.

Still, the Liberty Tax product allows users to import tax documents quickly and easily, and it’s known to offer an easy-to-follow tax preparation experience. Taxpayers even have a remote filing option, where they simply upload copies of their documents and let a professional do the rest. While it offers limited advice from tax professionals, some tax expert assistance is available.

Liberty Tax Pros

Useful review tool, mobile optimized, simple interface for ease of use, and remote filing option.

Liberty Tax Cons

Less guidance and fewer bells and whistles than competitors.

 

The Best Free Tax Software

Many tax software products offer a free version for a limited number of tax situations, or perhaps they promote a free federal return but expensive state filing fees. Still, some tax filers seek the best free tax software that truly costs nothing to file taxes.

Looking for an online software product that will help you file your taxes for free? Consider the following options.

 

8. FreeTaxUSA

FreeTaxUSA has been called the best low-cost software product, and for good reason. The online tax software offers free filing for all tax situations, including filing jointly and claiming homeownership, dependents, itemized deductions, self-employed income, investments, rental property, retirement income and tuition program distributions. Because FreeTaxUSA does not offer in-person or phone-based customer support, it’s best suited for users who are more comfortable filing their tax returns with little or no assistance.

The FreeTaxUSA online software does, however, feature easy prior-year imports from TurboTax, H&R Block or TaxAct. But it does not include a document import feature, so users have to enter some information manually. Once returns are filed with FreeTaxUSA, they automatically are stored as PDF files for up to 7 years.

FreeTaxUSA also is a great tax software choice for members of the military since it helps them get the biggest available refunds. The software supports tax breaks such as combat pay exclusions, moving expense deductions, uniform deductions, reservist’s travel deductions, job search expenses, EITC for nontaxable combat pay, and others.

FreeTaxUSA Pros

Easy prior-year imports, free for all federal returns, supports military tax breaks.

 

9. Cash App Taxes

Formerly known as Credit Karma Tax, Cash App Taxes is quickly gaining a reputation as the best free tax software on the market thanks to its truly free tax filing service for both state and federal returns. The mobile tax filing product is a great option for users who are accustomed to tax software and don’t need one-on-one support.

Unlike many competitor tax preparation software options, Cash App Taxes does not use filers’ income to qualify for free products and services. Instead, it includes most major IRS forms and schedules as well as many other tax situations that other free tax software doesn’t support, including those for rental income and the student loan interest deduction.

Cash App Taxes’ mobile software features a user-friendly navigation tool that guides users through the tax preparation process. The app also saves users time by supporting 1040 importation with its Smart File feature. Cash App Taxes even offers free audit defense and an accurate calculations guarantee, so if the service makes a mistake, users could receive as much as $1,000.

Cash App Taxes Pros

Truly free federal and state returns, free audit support, and an easy to use interface.

Cash App Taxes Cons

Lacks one-on-one support and difficult to import investments.

 

10. TaxHawk

TaxHawk will once again offer free federal tax filing , as well as low-cost state filing. In fact, many tax filers who don’t qualify for free tiers with competitor tax software products might discover better prices with TaxHawk. Even after paying for state filing, many TaxHawk users save money compared to other services.

The TaxHawk tax software, however, is a bare-bones service that doesn’t include W-2 or 1099 imports. Being unable to import tax form PDFs for spreadsheets with investment data could create issues for users with complex tax returns.

Regardless, the TaxHawk software is easy to use and features a range of questions as well as a quick navigation menu to guide customers through the tax filing process. While state returns cost $14.99, the free federal filing includes many options that cost money with competitors, including interest income, dividends and self-employment income. TaxHawk even supports cryptocurrency trades, although users must manually key all the information.

TaxHawk Pros

Low-cost state filing, additional free federal options, and a quick navigation menu.

TaxHawk Cons

Only federal returns are free and a bare-bones interface.

 

11. IRS Free File Program

A variety of tax filing software programs offer limited free versions of free filing to taxpayers in certain situations. However, one lesser-known program provides free tax filing with fewer limitations and restrictions. with the IRS Free File program, taxpayers with an adjusted gross income of less than $73,000 can qualify for free tax filing through a number of top tax providers. They also can complete free fillable forms to file through the IRS website.

IRS Free File partners include TaxAct, FreeTaxUSA, TaxSlayer and a number of other tax software companies. While the program has entered its third decade, many taxpayers are unaware of the IRS Free File option, although the IRS estimates that as many as 70% of all taxpayers qualify for the program.

Free File Pros

Free federal returns for more taxpayers, and multiple partners to choose from.

Free file Cons

Not available to taxpayers earning more than $73,000 per year.

best tax software

Tax Filing Software Comparison Table

Free Federal Efile?Basic TierPremium TierState Returns
H&R BlockYes$19.95$64.95$19.95
TurboTaxYes$39.00$89.00$39.00
TaxSlayerYes$29.95$59.95$39.95
E-fileYes$20.99$37.49$22.49
TaxActYes$24.95$64.95$44.95
Jackson Hewitt OnlineNo$25.00$25.00Included
Liberty TaxNo$45.95$85.95$36.95
FreeTaxUSAYesFree$7.99$14.99
Cash App TaxesYesFreeFreeFree
TaxHawkYesFreeFree$14.99
IRS Free FileYes, if income is less than $73,000FreeFreeVaries

What is the Best Tax Software?

The best tax software depends greatly on each individual taxpayer and their financial situation. How complex is your tax return? Do you have to complete multiple tax forms and claim a variety of deductions, or is it a simple return based on a single W-4 with a standard deduction?

Are you an educated tax filer who understands the information and has an idea of what to expect from your tax return? Do you know the various 1099 rules and deduction requirements? Or are you an inexperienced taxpayer who needs additional guidance?

Are you looking for free tax software, or are you comfortable with paying a modest fee? Keep the answers to these questions in mind when comparing the best tax software providers.

What is Tax Software, and How Does it Work?

We all hear plenty about the various tools, but what is tax software, and how does it work? The digital products offer users varying levels of guided help to file their federal and state tax returns.

In addition to helpful interfaces that assist tax filers with completing the appropriate tax forms, some tax software also imports tax forms from the IRS, locates tax deductions and provides both expert tax help and customer service support.

While the exact process for each type of tax software will vary, most operate in a similar manner. Here’s how tax software typically works:

  • User Interface and Guidance: The software guides the user through a series of steps, helping them understand which tax forms need to be completed based on their personal or business financial situation. The tool often uses a question-and-answer format, which makes it more straightforward and easier for users who are unfamiliar with tax laws.
  • Data Input: The user provides information from their tax documents, such as W-2s and 1099s. This may include details about their income, payments, deductions (like mortgage interest, student loan interest, business expenses, and health savings account contributions), and other relevant financial data. Some sophisticated tax software products can also import tax forms directly from the IRS or from other financial institutions to streamline the data entry process.
  • Calculations: Once the data has been entered, the software automatically calculates the user’s tax liability or refund based on the provided information. It applies current tax laws, considers any available tax credits or deductions, and takes into account the tax filing status of the user (e.g., single, married filing jointly, head of household, etc.)
  • Payment or Refund Management: If the user owes taxes, they can often pay directly through the software using their bank account details. Conversely, if the user is due a refund, they can provide their banking details for a direct deposit.
  • Filing Taxes: After everything is complete, the user has the option to e-file their taxes directly to the IRS and state tax agencies through the software. Alternatively, they may choose to print out the completed forms and mail them in for a more traditional paper filing.
  • Customer Support and Expert Assistance: Most tax software offers some form of customer service or expert tax help. This could range from FAQs and online forums to live chat support or even one-on-one consultations with tax professionals.
  • Cost and Pricing Options: The price for tax software varies based on the complexity of the user’s financial situation and the level of assistance they require. Some platforms offer free versions for users with simpler tax situations, while others may charge a fee for additional features or more complicated tax situations.

In summary, tax software is a valuable tool that can help streamline the tax preparation process, increase accuracy, and save users time and potentially money by identifying all applicable deductions and credits. It’s a useful resource for both novices and experienced tax filers alike.

Why You Should Use Tax Preparation Software

Processing the taxes for your business doesn’t have to be too unpleasant when you have the right tools. But you have to remember it can go beyond just filing a W-2 for small businesses depending on your business structure. If you are among the millions of self-employed filers, there are several reasons to consider using online tax software or small business tax services when preparing your business taxes:

  • Better time and money savings: The time you will save using tax software is huge. You can easily knock an hour off your prep time, if not more. This benefit is especially helpful if you have to file Schedule C and other forms.
  • Ease of use: All the programs we reviewed are easy to use, even if you have no prior experience with tax software. They walk you through the process step by step, and most include help features in case you get stuck.
  • Accuracy: The best tax prep software options are highly accurate, which reduces the chances that you will make an error on your return. This fact is especially important if you are self-employed or have a complex tax situation.
  • Deductions and credits: Most programs have built-in features that help you find deductions and credits you may be eligible for, saving you a good deal of money.
  • Free expert support: Many tax prep software programs offer free support, audit assistance and advice from a tax pro.
  • Streamlines the process: Using tax software programs can help you stay organized and on top of your taxes throughout the year. This aspect can save you time and money in the long run.

best tax software

Evaluating Your Tax Software Needs

Choosing the right tax software is a critical decision for small business owners. The appropriate software can save time, reduce errors, and ensure compliance with tax laws. This section will help you evaluate your specific tax software needs, ensuring you select a product that aligns perfectly with your business requirements.

Assessing Your Tax Situation

Start by assessing the complexity of your tax situation. If you have a straightforward tax profile, such as a sole proprietorship with standard deductions, basic tax software might suffice. However, more complex situations like multiple income streams, investments, or operating in various states may require advanced software features.

Considering Business Size and Structure

Your business size and structure significantly influence your tax software needs. A solo entrepreneur has different requirements compared to a business with employees or complex corporate structures. Ensure the software you choose can handle your specific business type, whether it’s an LLC, partnership, S-corp, or sole proprietorship.

Identifying Key Features Needed

List the key features you need in tax software. These might include income and expense tracking, support for specific tax forms, the ability to handle state and federal taxes, or features for specific deductions relevant to your industry.

Integration with Other Systems

Consider how well the software integrates with other systems you use, such as accounting or payroll software. Seamless integration can save time and reduce the likelihood of errors by automating data transfer.

Forecasting Future Needs

Think about not just your current needs but also potential future requirements. As your business grows, your tax situation may become more complex. Choose software that can scale with your business to avoid the need for switching systems later on.

Evaluating Cost vs. Benefit

Analyze the cost-benefit ratio of the software. While cost shouldn’t be the only deciding factor, it’s important to choose software that offers the features you need at a reasonable price. Also, consider the long-term savings in terms of time and resources that efficient tax software can offer.

By carefully evaluating these aspects, you can choose tax software that not only meets your current needs but also supports your business as it grows and evolves.

How to Choose the Best Tax Preparation Software for Your Small Business

With so many great tax preparation software tools from which to choose, how is a taxpayer decide on the best service for their tax situation? If you’re comparing the various online tax software products, be sure to make the following considerations:

Compare Software Costs

How much do you hope to spend on tax preparation software? Are you looking for the cheapest possible option, or do you have the budget to support additional features? Some software offers only a bare-bones option for free, with upgrades to support additional features. Does your income level qualify for the IRS Free File program?

Consider Available Tax Forms

Are you entering tax information from a simple 1040 form, or does your individual tax situation involve additional streams of business income or unemployment income reported on a w9 form or another tax document? Some tax software companies support a wide range of tax forms in their free version, while others require users to upgrade and pay extra fees to file extra tax forms. Also don’t forget to ensure the selected software program supports any credits for which you qualify, including the earned income tax credit, the child tax credit and itemized deductions for charitable donations.

Remember Other Business Needs

Do you need a simple online software program that merely supports tax filing, or are you in search of a more comprehensive financial software product that supports additional business needs? If you are looking for programs that include features such as invoicing software, then you will want to consider software providers that fulfill a wider range of financial needs.

Beware of Potential Tax Scams

Tax season can also be known as scam season as a plethora of offers from imitation providers with false promises of larger refunds infiltrate taxpayers’ inboxes. When considering the best tax software, stick with trusted brands and offers found on legitimate websites, otherwise, you could unknowingly provide your private information to tax scams.

best tax software

Final Words

What is the best tax software? It all depends on the taxpayer’s wants and needs. Are you looking for a simple software product that costs the least, or a robust set of technological tools that will provide the maximum tax refund or lowest taxable income? While plenty of users prefer trusted brands like H&R Block and TurboTax, other taxpayers are opting for lesser-known software options that cost less while still providing a superior tax filing experience.

best tax software

How much does it cost to use tax software?

The cost to use tax apps ranges from free to hundreds of dollars depending on the software provider and the complexity of the tax return. Tax filers whose tax returns might include forms not generally offered in the free version of most tax software might qualify to file federal taxes for free using the IRS Free Filing program for taxpayers earning less than $73,000 per year.

Which free tax filing software is best?

Formerly Credit Karma Tax, Cash App Taxes offers superior free tax filing services compared to competitors like H&R Block and TurboTax. The Cash App Taxes software supports a wider range of available tax forms and features more useful tools to maximize a tax return than comparable free products. Plus, state returns are also free for most taxpayers.

best tax software

What happens if you miss the tax deadline?

If you miss the tax deadline, a few things can happen. The most common penalties for filing taxes late are failure-to-file and failure-to-pay penalties if you don’t pay by the due date. However, if you can show that you had a good reason for not filing on time, the IRS may waive the failure-to-file penalty. You can also ask for a payment plan if you can’t pay your entire tax bill at once.

Should I hire a tax professional to help with my small business tax filing?

There are a few things to consider when deciding whether or not to hire a tax professional to help with your small business’s tax filing. The most important factor is how complex your taxes are. If you have more than one business, own property, or have investments, you may need the help of a professional to get all those tax figures and deductions you need.

You should also consider how comfortable you are with doing your own taxes and whether or not you have the time to do them. If you decide to hire a professional, make sure you choose someone who is qualified and reputable. You can check the IRS website for a list of registered tax preparers in your area.

Lastly, keep in mind that tax preparation fees are a deductible expense, whether it’s a DIY filing or working closely with a tax professional or accountant.

best tax software

When should I consider hiring a tax professional?

Should you hire tax preparation services instead of selecting tax software? While filing your own tax return using online software is an option available for practically any taxpayer, the savings might not be worth the cost in some situations.

Certainly, it can cost less to use online tax apps than to hire a professional tax preparer, but if the trade-off is lost deductions and tax credits that otherwise would significantly lower a tax bill, then the better option is to pay for the expert service.

Which free tax software is best?

Which free tax software is the best? Is it the free version of the H&R Block tax filing program, or perhaps the ultra-popular TurboTax free version? While those might be adequate for taxpayers with a simple W2 form, the upgrades for additional forms and deductions come with fees.

Cash App Taxes provides the most robust software program for free filing taxes, although the IRS Free File program will help taxpayers earning $73,000 or less file federal taxes with partner programs at no cost.

best tax software

What software do tax preparers use?

The best online tax software products like H&R Block and TurboTax might offer tax filers user-friendly experiences, but they are not the same products used by a professional tax preparer such as a certified public accountant. Tax preparers rely on professional tax software products like ProSeries, ProConnect and TaxAct Professional to sign and e-file returns as paid preparers.

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Samantha Lile Samantha Lile is a staff writer for Small Business Trends as well as freelance writer and journalist who contributes to a variety of web publications from her home office in the heart of the Ozarks. Her work can be viewed at Samantha Lile.

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