Top Tax Software

TurboTax is pricey, but still the best tax software

TurboTax, H&R Block At Home and TaxACT are the three leading tax software packages. For most, reviewers say that TurboTax is the best choice all around. However, H&R Block At Home is a bit less expensive and a fine choice if you've used it successfully in the past. TaxACT is a lot less expensive, and the best choice if you're tax-savvy or have a simple tax return – if, for example, you have a couple of W2's, some interest income and a couple of kids, plus some deductions for child care or an IRA.

If you don't need a lot of extra help, you can also opt for these companies' free basic versions. They make federal filing free for everyone, although state returns cost extra, That's unlike the government's IRS Free File program, which is only available if your adjusted gross income is $57,000 or less. For more information about these free or cheap alternatives, see our sections titled Best for Simple Returns and IRS Free File Program.

If, however, your tax situation is more complex -- say you are self-employed, have income from real estate investments or have capital gains or losses (for example, you sold stocks, mutual funds or a home), nearly all reviewers say you should turn to TurboTax. The cost of TurboTax Deluxe 2011 (*Est. $50) includes the preparation and online filing of your federal tax return, as well as preparation of one state tax return; e-filing the state return costs $20 extra. Preparing and filing extra state returns can be done for a fee ($40 per state). The Premier version of TurboTax 2011 (*Est. $75) provides additional help for those with investments and rental-property income, while the Home & Business version (*Est. $100) is meant for those with full-fledged home businesses.

Reviewers who test tax preparation software with complex returns, including testers at PCMag.com, PC World, Macworld and The New York Times, all find TurboTax the most effortless tax software to use. "Intuit likes to call TurboTax a GPS for your taxes. It's an apt description," says Kathy Yakal at PCMag.com. "You always know where you are, how to get where you're going, and you can ask questions if you're lost or don't understand the freeway signs."

For 2011, TurboTax offers unlimited free online chat help from tax experts -- and TurboTax Premier users get unlimited phone calls to the experts, too. TurboTax can also import a broader range of W-2 and 1099 forms from participating employers and banks, PC World's Yardena Arar points out.

Runner-up H&R Block At Home does offer a couple of advantages over TurboTax. It's cheaper -- you'll spend about $10 less for H&R Block At Home Deluxe 2011 (*Est. $30) or $25 less for H&R Block At Home Premium 2011 (*Est. $50) than for comparable TurboTax products. If you're willing to do your taxes online, though, the prices are identical -- $30 for Deluxe or $50 for Premium with either program.

You can also buy some additional perks from H&R Block. For instance, with all paid H&R Block At Home products, a tax professional will provide individual support in case of an audit; that kind of service costs $40 extra with TurboTax. The H&R Block At Home Premium edition includes one free live tax-advice session with an H&R Block consultant. If you're nervous about doing your taxes on your own, you can opt for the unusual H&R Block At Home Best of Both online edition (*Est. $80), which guides you through your return online; an H&R Block pro then reviews, corrects, certifies and e-files your return for you.

Still, when top testers pit H&R Block At Home against TurboTax, TurboTax always wins. Macworld's Jeffery Battersby docks H&R Block a half-point for a user interface that "seems a bit austere" next to TurboTax. PC World's Yardena Arar finds H&R Block's software harder to navigate. PCMag's Kathy Yakal winds up in a tangle when H&R Block's software detects her missing home-office square footage data -- and sends her all the way back to the beginning of Schedule C. H&R Block mistakenly tells The New York Times' Tim Gray that he can't get a tax credit for his new high-efficiency wood stove, a credit that TurboTax handles flawlessly.

If you've used H&R Block and liked it, experts say there's no need to switch. But overall, when it comes to tax software, "TurboTax is still the one to beat," PC World says.

Do your taxes on your iPad

For 2011, TurboTax, H&R Block At Home and TaxACT have all unveiled versions that work on the iPad -- and TurboTax wins in this category, too.

Even if you've got a complex tax return, experts say you can cruise through it with TurboTax for the iPad 2011. It's basically "a snazzy-looking version of the same software you'd get on the Web," PC World's Yardena Arar says. You can choose from among the Deluxe (*Est. $30), Premier (*Est. $50) or Home and Business (*Est. $75) versions, with almost all of the same features as the regular online versions at the same price. A state return costs $37 extra, as usual with TurboTax's online versions.

"The program worked perfectly from start to finish," Macworld's Jeffery Battersby says after testing TurboTax for the iPad.

You can tap into TurboTax for the iPad in two ways: There's an online version that opens in the Safari web browser, or you can download the software as an iPad app that it lets you work on your taxes even when you're not online. PCMag's Kathy Yakal tests them both, and she says she prefers the Safari version. It looks and acts more like regular TurboTax, and it lets you switch from your iPad to another computer more easily as you work on your taxes. She says the Safari version also makes it easier to correct mistakes in the Final Review process at the end, which flags possible mistakes in your tax return.

H&R Block has an iPad app, too, but it's not designed to handle complex tax situations. The company says its Free edition for iPad is meant for "simple tax returns": You can file your federal tax return for free, but you can't import last year's tax return or file Schedule C for self-employed people, for example. You can step up to the Deluxe edition (*Est. $30) on the iPad, which imports data, gives more guidance for homeowners and investors, and includes Schedule C. It'll cost you an additional $30 to file a state return.

Like TurboTax, H&R Block offers two avenues for iPad users: You can download the app or work on your taxes online in Safari. As with TurboTax, PCMag's Kathy Yakal finds the Safari version works better. It lets her use the Help search box, while the app version presents her "with a blank window -- or nothing -- more often than not" when she searches for tax help. She says that's "a rather serious problem for some people."

Macworld's Jeffery Battersby notices a big problem in his test, too: H&R Block's iPad app would have let him file his tax return with a bunch of important forms omitted.

"I'd completed my entire return before realizing that I had not entered any K-1 information and that I was also missing some other forms as well." Battersby concludes, "TurboTax Deluxe for the iPad seems to be the safer choice for the uninitiated tax filer."

TaxACT doesn't have a dedicated iPad app, but its online edition works on the iPad. None of our sources has tested TaxACT on the iPad, but they do highly recommend TaxACT in general as a complete -- and much cheaper -- alternative to TurboTax. See our the next section for more on TaxACT.