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The 5 Best Free Tax Software for 2021
With tax filing season upon us, it’s time to start thinking about how you’re going to file your taxes and get the best possible refund. While some individuals prefer to rely on a tax professional to ensure their tax returns are accurate, not everyone wants to pay the fees associated with doing so. Thankfully, there’s plenty of free tax software available to help you file your taxes.
- HR Block
E-File State Return$44.99Deluxe Plan$159.98Mobile App Rating4.5/5 - TurboTax
E-File State Return$50.00Deluxe Plan$170Mobile App Rating4.6/5 - TaxAct
E-File State Return$54.95Deluxe Plan$109.95Mobile App Rating3.95/5 - TaxSlayer
E-File State Return$39.00Deluxe Plan$76.00Mobile App Rating4.6/5
It’s important to note that anyone can file federal taxes for free through the IRS website. If your income is below $69,000, the website will direct you to some of the free software available that will walk you through the filing process. If your income is above $69,000, you’ll need to know how to file taxes yourself by filling out IRS forms, but you can still do it for free online.
According to the IRS, about 70% of all taxpayers are eligible to do their taxes for free. That said, most free tax filing software will only allow you to file a simple tax return. Some may not include more complex income declarations like capital gains or self-employed income.
The 5 best free tax software of 2021
- H&R Block Free Edition: Best overall
- TurboTax Free Edition: Most user-friendly
- TaxAct Free Edition: Best for complex returns
- TaxSlayer Simply Free: Cheapest paid products
- FreeTaxUSA Free Edition: Best comprehensive service
| Software | Can File State Taxes | Free Import from Prior Year | Joint Filing | Supports Some Complexities | Gross Income Limit |
|---|---|---|---|---|---|
| H&R Block Free Edition | Yes | Yes* | Yes | No | $66,000 |
| TurboTax Free Edition | Yes | No | Yes | No | $34,000 |
| TaxAct Free Edition | Yes | No | Yes | Yes | $59,000 |
| TaxSlayer Simply Free | Yes | Yes | Yes | No | $100,000 |
| Free Tax USA | Yes | Yes | Yes | Yes | $36,000 |
*Can import from other tax products
H&R Block Free Edition: Best overall
Best overall – HR Block
While TurboTax has the tax software market cornered due to its recognizable brand, H&R Block’s free tax software excels in areas where TurboTax is lacking.
For one, you can file for free using H&R Block with a gross income of up to $66,000, almost twice the limit on TurboTax’s product. You can also file free state taxes through H&R block through the IRS Free File Program, and H&R Block allows you to import last year’s tax info from other tax products.
H&R Block offers technical support via chat for its free product, and you can claim the Earned Income Tax Credit (EITC). Like most free tax software, H&R Block’s free edition is best suited to simple returns, but it’s built with a user interface that takes you through the filing process step-by-step and is easy to understand.
Most user-friendly – TurboTax
It’s hard to talk about tax filing products without mentioning TurboTax. Intuit’s software serves millions of customers each year, and its online unit sales increased by 7% by the end of the 2019 tax season.
Most tax filers are attracted to TurboTax because it’s a name they recognize, but it’s won countless accolades for the ease of its software. Nonetheless, there are some drawbacks to TurboTax’s free version that not everyone takes account of.
First, you can only file for free with TurboTax if you have a gross income of less than $34,000. If you make more than that, you’ll need to pay extra to file, and you’ll likely be prompted to pay only after you’ve been filing for a while. You’ll also need to upgrade if you want to import last year’s information into the free online edition of TurboTax.
Nonetheless, there’s something to be said for simple tax filing. If you make less than $34,000 each year, you’re probably filing a relatively simple tax return anyway, so TurboTax is still a good option based on its user-friendliness.
Best for simple returns – TaxAct
If you need to file a simple tax return and you want to use free software, your best option is TaxAct’s Free Edition.
It offers free filing for school tax deductions, W-2 processing and other basics. However, it does offer free filing if you’re self-employed or otherwise contracting.
Nonetheless, you’ll likely have to upgrade the software if you have any investments, own any real estate or if your tax returns are otherwise relatively complex.
Cheapest paid products – TaxSlayer
If you aren’t sure whether you can file a free return but you’re willing to pay a little more to get the job done, TaxSlayer is a good option. It’s paid products are the cheapest in the marketplace.
TaxSlayer’s user interface is comparable to other software products, and it’s relatively easy to use if you want to file a simple return. If you want to claim income other than that reported on W-2 forms, make itemized educations or apply for tax credits, you’ll need to upgrade. However, most filers would do just fine with their “Classic” software, which charges just $17 to file federal taxes.
Best for complex returns – FreeTaxUSA
FreeTaxUSA makes it easy to file a variety of forms for your taxes.
The free version allows for hundreds of forms, only excluding a small handful, like nonresident alien returns, foreign employment income or donations of items over $5,000 in value. Other than that, FreeTaxUSA is a fantastic, no-gimmick tax software. Upgrading to the deluxe version for only $6.95 guarantees you quick customer service responses, unlimited amends and audit assistance.
Furthermore, like other tax software, you can import your information from years prior to the next year, making it easy to plug in 2019’s numbers and file quickl
What is free tax software?
Tax software removes the complexities of filing taxes and replaces them with an intuitive user interface that walks you through the process, usually by asking you simple questions. Typically, it costs money to use this software, but free versions exist for people who only need to file a simple tax return.
Even though tax software is advertised as “free,” you may end up paying a small fee to file state taxes. Additionally, if you wish to pay for any filing out of your tax refund, many companies will charge a fee for that type of processing. But paying for the state tax filing fee has no fees attached when customers pay with a credit or debit card.
How should I choose the right free tax software?
Your first step should be to analyze your tax situation. If you need to file a complex return or you make a substantial amount of income each year, free tax software probably won’t work for you. For example, if you have investments in the stock market, if you own real estate or if you’re self-employed, most free tax software won’t let you include income from those sources unless you upgrade.
If you qualify for a free version, ease of use is usually the best way to judge what’s best for you. Pay attention to income limits as well. If you need help with your taxes, choose free software that also offers a robust support system.
Too long, didn’t read?
Free tax software isn’t for everyone, but it’s a great way to save money if you need to file a simple return. Although most free software is comparable, subtle differences like income limits and being able to import last year’s information will make or break your experience.
Keep Reading
Methodology
The SimpleScore is a proprietary scoring metric we use to objectively compare products and services at The Simple Dollar.
For every review, our editorial team:
- Identifies five measurable aspects to compare across each brand
- Determines the rating criteria for each aspect score
- Averages the five aspect scores to produce a single SimpleScore
Here’s a breakdown of the five aspect scores and their rating criteria for our review of the best tax softwares of 2020.
Why do some brands have different SimpleScores on different pages?
To ensure the SimpleScore is as helpful and accurate as possible, we developed unique criteria for every category we compare at The Simple Dollar. Since most brands offer a variety of financial solutions, their products and services will score differently depending on what we’re scoring on a given page.
However, it’s also possible for brands to have multiple SimpleScores. For example, when we apply our methodology to Chase’s stock trading product, it scores a 3.6 out of 5. On the other hand, when we compare Chase checking accounts, it scores a 4.4 out of 5. this is because we each criterion for every category is different to account for different industry standards and product offerings.
Questions about our methodology?
Email Hayley Armstrong at hayley@thesimpledollar.com.
Mobile app rating
We took an average of Google Play Store and iOS Apple App Store ratings of each tax preparation company’s app and assigned aspect scores accordingly.
Deluxe plan price
Taxes are already not fun in the United States. What makes it worse is if you have to dish out hundreds of bucks to file your taxes. That’s why we award higher scores to brands with lower deluxe plan pricing.
State return e-file price
While most tax preparation softwares have free federal tax return filing, many more charge for each state e-file. While users can just print their state return and mail it in, that’s annoying. We award brands that charge less for state return e-filing.
Self-employed price
If you own a business or survive solely on freelancing, every dollar counts. That’s why we give out higher scores to brands that charge less for self-employed tax filing.
Customer support
Like we said, tax season is hard. That’s why we award brands with higher SimpleScores when they have multiple channels of support. When customers need help filing, it’s important to be able to reach out.
