Best Tax Software of 2021
U.S. News 360 Reviews takes an unbiased approach to our recommendations. When you use our links to buy products, we may earn a commission but that in no way affects our editorial independence.
Popular Tax Software
Best Tax Software
- 360 Overall Rating
4.4 out of 5
- Base Fee
- $60 & Up
- Free Version
- Mobile App
Best With In-Person Help
- 360 Overall Rating
4.3 out of 5
- Base Fee
- $49.99 & Up
- Free Version
- Mobile App
Best Affordable Tax Software
- 360 Overall Rating
3.8 out of 5
- Base Fee
- $17 & Up
- Free Version
- Mobile App
Filing your income tax return can be a confusing and challenging process. That may be especially true when filing in 2021, as many taxpayers have received unemployment benefits or stimulus checks, changed jobs, or moved to a different state in the past year. All these events can affect the tax filing process.
Tax preparation software can help make the task a bit easier. These programs can take the guesswork out of filing your taxes by asking questions to determine which forms you need. They can calculate the amount of your tax refund or how much you owe, and file your return for you electronically. Plus, many programs will keep your tax return on file so you can use it to help simplify the filing process the following year.
To help you choose the best tax software, we’ve researched tax preparation companies and crunched the numbers to get this unbiased review of the Best Tax Software of 2021. In this guide, you’ll find information about the companies that made our rating, plus advice on how to shop for tax software products and choose the right program for you before Tax Day on April 15, 2021.
(AndreyPopov)
#1 TurboTax
#2 H&R Block
#3 TaxAct
#4 Credit Karma Tax
#4 TaxSlayer
#6 Jackson Hewitt
Best Tax Software of 2021
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Company | Base Price | Mobile App | Free Version | Learn More |
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| TurboTax » 4.4 out of 5 | $60 & Up | Learn More » | ||
| H&R Block » 4.3 out of 5 | $49.99 & Up | Learn More » | ||
| TaxAct » 4.1 out of 5 | $29.95 & Up | Learn More » | ||
| Credit Karma Tax » 3.8 out of 5 | Free | Learn More » | ||
| TaxSlayer » 3.8 out of 5 | $17 & Up | Learn More » |
TurboTax: TurboTax takes the No. 1 slot in our rating once again with a score of 4.4 out of 5. It uses a Q&A format to determine how to fill out your tax forms and walks you through the process step by step. It’s often praised for its focus on user experience and design, though these features do come with a hefty price tag. TurboTax is the most expensive brand in our rating, with prices for its paid products ranging from $60 to $200. It does offer a free version of its online software along with three other paid tiers: Deluxe, Premier, and Self-Employed. It also offers versions of each product with on-demand support from tax experts or in downloadable or CD format. As of 2021, you can use TurboTax Live Full Service to have a tax professional prepare and file your taxes for you.
Learn more in our TurboTax review or check out the top TurboTax service codes.
H&R Block »
Best Tax Software With In-Person Assistance
- 360 Overall Rating
4.3 out of 5
- Base Fee
- $49.99 & Up
- Free Version
- Mobile App
H&R Block: H&R Block is perhaps best known for its thousands of retail locations around the world, but it also offers impressive tax software, which earns a score of 4.3 out of 5 to take the No. 2 spot in our rating. H&R Block offers four tiers of software products that range in price from free to $104.99, with additional costs for state filings. This software is available online or for download. You also have the option of getting live support from tax professionals for an additional fee.
Learn more in our H&R Block review.
TaxAct: TaxAct has a range of online and downloadable products that can suit all types of filers, although it doesn’t offer the ability to get live support from tax professionals as some of its competitors do. It’s priced lower than other companies with its paid products ranging from $24.95 for the Deluxe version (roughly half the price that TurboTax sells its Deluxe software) to $139.95 for the Online Self-Employed + Xpert Help edition, which includes a state return as well as a federal return.
Learn more in our TaxAct review.
Credit Karma Tax: Credit Karma is unique among the tax preparation companies in our rating in that it only has one product. Credit Karma Tax is a free program that supports many, although not all, tax situations. It doesn’t offer professional tax help or the ability to download its products, but if you have a relatively simple return and are comfortable with online software, Credit Karma might be a good option to consider. In our rating, it ties with TaxSlayer with a score of 3.8 out of 5.
Learn more in our Credit Karma Tax review.
TaxSlayer »
Best Affordable Tax Software
- 360 Overall Rating
3.8 out of 5
- Base Fee
- $17 & Up
- Free Version
- Mobile App
TaxSlayer: TaxSlayer offers fewer products than its competitors, with its software only available online, not for download. However, other tax prep companies tend to vary their product levels based on the forms you need, whereas TaxSlayer allows for all forms with its Classic edition; its other editions go up in price depending on the professional assistance that you need. If you’re comfortable filing your taxes yourself, TaxSlayer’s Classic edition is the cheapest option for all forms at $17 for federal filing.
Learn more in our TaxSlayer review.
Jackson Hewitt: Jackson Hewitt gives you the option to use their tax preparation software or visit one of their roughly 6,000 office locations. The software follows an interview-style format that can help walk you through forms if you get stuck. Live chat and phone help are also available. If you choose to file with a tax pro rather than with software, Jackson Hewitt has a few options available to reduce contact because of the coronavirus pandemic.
Learn more in our Jackson Hewitt Tax Service review.
Tax software helps you prepare and file your income tax returns faster and more easily than filling out paper forms. It keeps things organized, provides step-by-step instructions, and calculates how much you owe or how much the government owes you, says Christopher Jervis, managing partner of Lone Wolf Financial Services LLC.
Because tax software automates much of the filing process, it saves time and money while helping to ensure your return is accurate and follows the latest tax laws. All you have to do is answer some questions about any major life events in the previous year (such as getting married or having children) and correctly enter data from your W-2s, 1099s, and other relevant forms.
The beauty of tax software is that, with some products, you don't need to know anything about taxes to use it. Plus, a tax program may keep you from having to pay a considerable fee to hire a certified public accountant, enrolled agent, or other tax professional.
Most consumer-focused tax software falls into one of two categories:
- Form-based: This presents electronic versions of various tax documents and forms. You'll need to fill in the data from your corresponding paper forms, making sure to put the correct numbers in the correct boxes.
- Interview-based: This type can be easier to use for some people because it comes in a question-and-answer format. Just answer the questions, and the software will complete your tax forms for you.
For more information, see our How Does Tax Software Work? guide
While no one needs tax software, it can be a huge help to many people, especially if you have a relatively simple return and don't need in-person consultation from a tax professional but would still like some guidance. If you want to claim multiple deductions, report self-employment or investment income, recently had a child, or otherwise have a more complex situation, having a tax professional prepare your return may be the best choice to make sure it's done correctly. Ultimately, whether tax software is worth the investment for you depends on how you weigh the advantages and disadvantages.
Advantages of tax software include:
- Easy to use: Most tax programs have intuitive interfaces that are easy to use, even if your knowledge of taxes and computers is minimal.
- Fast: Tax software can significantly speed up the filing process compared to doing your taxes manually with paper forms, especially if you've stayed organized throughout the year and have all your pertinent information readily available.
- Cost-effective: You could easily pay a tax professional $275 or more to prepare an individual tax return, whereas using tax software will cost significantly less.
- Provides live support: While you won't see a tax professional in person if you use tax software, some programs provide live, one-on-one support over the internet or by phone.
- Offers instant insight: Riley Adams, CPA and founder of Young and the Invested, notes that tax software can instantly calculate how different filing decisions will affect your tax bill.
- Helps uncover tax savings: Tax software will ask you questions you might not have thought of that could entitle you to credits or deductions, such as whether you had children or sold real estate in the previous year, says Robert Gauvreau, CPA and founder of Gauvreau & Associates.
Tax software has some disadvantages as well:
- Not ideal for complex tax situations: If you’re self-employed, own a small business, earned investment or rental income, or have another complex tax situation, it may be worth the money to have a CPA or enrolled agent prepare your return to make sure you don't pay more in taxes than you owe.
- Could inspire false confidence: Adam Brewer, owner of Triumph Over Tax and a licensed tax attorney, notes that tax software depends on the data you enter being accurate. If the return contains an error, this will increase your chances of an audit. While some tax programs can check for missing information and other common errors before you file, relying too heavily on the software without carefully entering your information could backfire.
- Live support can be limited: Some programs offer live support that's limited to noting things in your return that could increase your risk of an audit, leaving you to figure out what to do on your own. If you need more support than this, such as help filling out a specific form or reporting a certain type of income, be sure to buy software that offers it. Note that this usually comes with an extra charge.
- Can’t maximize your refund: QuickBooks ProAdvisor Elena Bailey says that while tax software will seek to minimize your tax liability and maximize your refund, hiring a tax professional is the best way to ensure you get all the money you're entitled to. Plus, only a professional can help you plan for future tax years.
To buy tax software, you need to:
- Understand your tax needs. Different tax software is better for different situations, says Kenesha Coleman, a CPA at ColemanTax. You may just need to file a W-2, or you may have to file other forms and schedules because you have self-employment or business income (for example). You also might have had a significant life event, such as getting married, having a child, or starting your own company. Thinking carefully about these and similar issues will help you choose tax software that meets your needs. In addition, decide whether you want features, such as live tax support, audit support, or the ability to auto-import financial information from other software.
- Research your options. Tax software company websites can provide a wealth of information about specific products and the company itself, such as how long it's been around and whether it sells other types of financial software that could work with your tax program.
- Narrow your search. Research your options until you've come up with two or three tax programs that might be suitable. For each of them, decide whether you can afford the fees for both state and federal tax returns, as well as whether the software offers the level of support and other features you're looking for. For example, do you want an interview-style format that helps you identify all the credits and deductions you're entitled to, or do you prefer to fill out tax forms directly with a simple fill-in-the-blank interface?
- Read reviews. Our unbiased rating of the Best Tax Software of 2021 explains the pros and cons of the top tax programs to help you select the best one for you.
- Select your tax software. You'll be filing tax returns for the rest of your professional life, so choose software that will meet your needs both now and in the future so that you don't have to purchase and learn another program.
For more information, see How to Buy Tax Software.
When selecting tax software, look for the following features:
- Frequent updates: Tax software should regularly update itself with the latest tax law changes so you don't have to keep up with these yourself.
- Option to import forms: Rather than entering all your data manually, look for a program that lets you upload your W-2 forms, other tax forms, and receipts from charitable donations. Some tax programs can even import financial information from Quicken or other types of financial software, which saves even more time.
- Cloud-based software: Many companies give you a choice of downloading tax software to your computer or using a cloud-based version. The latter is generally preferable because it doesn't take up space on your hard drive, is updated regularly, allows you to work from anywhere you have an internet connection, and automatically saves your work on an encrypted cloud server.
- Technical and tax support: Most tax software comes with technical support if you have trouble using the software, as well as tax support to help you file your return correctly. However, the types and quality of support varies from program to program, especially when it comes to helping with your taxes. For example, some programs only have an automated "chatbot" that can answer basic questions from an online database, while others connect you with a live tax specialist who can help you choose a filing status, report different types of income on the correct forms, etc.
- Interview-style format: Software with an interview-style interface asks you pertinent questions about your income, deductions, etc., and provides more guidance than a simple fill-in-the-blank interface.
- Availability of tax forms: Choose a tax program that has all the tax forms and schedules you need.
- Information storage: Tax software should provide at least three years of storage for your tax returns, which will speed up the filing process in subsequent years and help if you're ever audited.
- Audit support: Choose a tax program that comes with audit support. With this service, a tax professional will help you respond to the IRS and possibly represent you in the event of an audit.
- State return option: Most tax programs will let you file a state return, but they charge different amounts for doing so. Some allow you to file the first state return for free, while others impose a fee for all state returns.
Learn More
For more information about tax software and filing your taxes, see the following guides:
Best Tax Software of 2021
Other Guides from 360 Reviews
For comparisons and advice about other products and services, see our other guides:
The following describes our 360 approach to researching and analyzing tax software companies to provide guidance to prospective consumers.
1. We researched the companies and products people care most about.
U.S. News analyzed and compared a variety of publicly available data, including internet search data, to determine which tax software companies Americans are most interested in. We found 13 companies that stand out in terms of volume of searches and research among consumers, as well as across different rating sources.
We then compared the available products provided by our top tax software companies across several criteria, including cost, key tax forms supported and the availability of expert help. Research shows that these are the most important criteria for people shopping for a tax service. We compared the least comprehensive tax service product offered by each company that didn’t come for free.
2. We created objective 360 Overall Ratings based on an analysis of third-party reviews.
U.S. News’ 360 Reviews team applied an unbiased methodology that includes opinions from third-party reviews as well as consumer reviews.
Our scoring methodology is based on a composite analysis of the ratings and reviews published by credible third-party professional and consumer review sources. The ratings are not based on personal opinions or experiences of U.S. News. To calculate the ratings:
(a) We compiled two types of third-party ratings and reviews:
- Professional Ratings and Reviews. Many independent industry evaluating sources have published their assessments of tax software companies and their products online. We consider several of these third-party reviews to be reputable and well-researched. However, professional reviewers often make recommendations that contradict one another. Rather than relying on a single source, U.S. News believes consumers benefit most when these opinions and recommendations are considered and analyzed collectively with an objective, consensus-based methodology.
- Consumer Ratings and Reviews. U.S. News also reviewed published consumer ratings and reviews of tax software companies. Sources with a sufficient number of quality consumer ratings and reviews were included in our scoring model.
Please note that not all professional and consumer rating sources met our criteria for objectivity. Therefore, some sources were excluded from our model.
(b) We standardized the inputs to create a common scale.
The third-party review source data were collected in a variety of forms, including ratings, recommendations and accolades. Before including each third-party data point into our scoring equation, we had to standardize it so that it could be compared accurately with data points from other review sources. We used the scoring methodology described below to convert these systems to a comparable scale.
The 360 scoring process first converted each third-party rating into a common 0 to 5 scale. To balance the distribution of scores within each source’s scale, we used a standard deviation (or Z-Score) calculation to determine how each company that a source rated was scored in comparison to the source’s mean score. We then used the Z-Score to create a standardized U.S. News score using the method outlined below:
- Calculating the Z-Score: The Z-Score represents a data point's relation to the mean measurement of the data set. The Z-Score is negative when the data point is below the mean and positive when it's above the mean; a Z-Score of 0 means it's equal to the mean. To determine the Z-Score for each third-party rating of a company, we calculated the mean of the ratings across all companies evaluated by that third-party source. We then subtracted the mean from the company’s rating and divided it by the standard deviation to produce the Z-Score.
- Calculating the T-Score: We used a T-Score calculation to convert the Z-Score to a 0-100 scale by multiplying the Z-Score by 10. To ensure that the mean was equal across all data points, we added our desired scoring mean (between 0 and 10) to the T-Score to create an adjusted T-Score.
- Calculating the common-scale rating: We divided the adjusted T-Score, which is on a 100-point scale, by 20 to convert the third-party rating to a common 0-5 point system.
(c) We calculated the 360 Overall Score based on a weighted-average model.
We assigned “source weights” to each source used in the consensus scoring model based on our assessment of how much the source is trusted and recognized by consumers and how much its published review process indicates that it is both comprehensive and editorially independent. The source weights are assigned on a 1-5 scale. Any source with an assigned weight less than two was excluded from the consensus scoring model.
Finally, we combined the converted third-party data points using a weighted average formula based on source weight. This formula calculated the consensus score for each product, which we call the 360 Overall Rating.
U.S. News 360 Reviews takes an unbiased approach to our recommendations. When you use our links to buy products, we may earn a commission but that in no way affects our editorial independence.