Evaluating TurboTax Software vs. Online Filing: Cost and Convenience Comparison
When it comes to doing your taxes, choosing between TurboTax software and online filing can be a significant decision. Both options have their pros and cons, and the choice largely depends on your personal preferences and financial situation. This article aims to provide a comprehensive comparison to help you make an informed decision.
Convenience of Online Filing
Many users have switched to online filing with TurboTax for its convenience. According to my experience, online TurboTax offers a more accessible solution. You can access your tax returns from any computer, making it easy to work on your taxes from home, office, or even a coffee shop. Additionally, past returns are readily available, eliminating the need to locate and open physical files. This feature alone can save you a lot of time and effort.
Online vs. Installed Software
It's important to note that TurboTax's online product is currently the company's primary focus. It is updated more frequently, which ensures that you always have the latest features and information. However, the online product lacks some features that are available in the installed version. For instance, the installed version allows you to work directly with tax forms, while the online version requires answering interview questions to make entries.
Family “Tax Preparer” Considerations
If you are the "family tax preparer," you might benefit more from the installed version. With online TurboTax, each family member preparing their own return requires a separate account and potentially separate fees. This setup can add up quickly, especially if multiple family members need to file. In contrast, the installed version allows you to prepare as many returns as needed within one account, making it more economical.
Cost-Effectiveness for Small Families
For those with a small family, including children and parents, downloading the installed version of TurboTax can be more economical. By preparing multiple returns with one download, you can save money compared to the online version, which can charge additional fees for each return. Additionally, if you do not need to prepare state returns or file by fax, the installed version might be the better choice.
When to Start with Online Filing
If you are uncertain whether you will need the features of the installed version, it's a good idea to start with online TurboTax. It doesn't cost anything to get started, and if you find that you need more advanced features, you can easily transfer your data to the installed version. TurboTax also offers the flexibility to prepare and file state returns or e-file returns up to a limit of 5 per software license, reducing costs even further.
Final Thoughts
The choice between TurboTax software and online filing ultimately depends on your specific situation. If you have a simple return and fall under certain caps, online filing might be the more cost-effective option. However, for more complex situations or if you are the "family tax preparer," the installed version could be more suitable. Regardless of your choice, both options offer reliable ways to ensure your taxes are filed correctly and on time.