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kennethherrerablog · 6 years ago

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H&R Block Tax Software Review: Should You File With It?

Paying taxes is one of the most dreaded annual activities for most Americans, right up there with dentist appointments and visiting your great-aunt Ruth.

But it has to be done.

Thankfully, online tax preparation software can ease the pain. One of the most popular options is H&R Block’s tax software.

Let’s take a look at what H&R Block offers and see how it stacks up against its competitors, TaxAct and TurboTax.

H&R Block Tax Software: What’s New for 2019?

Returning H&R Block tax software users will notice some exciting updates when filing their 2018 taxes:

Unlimited free live chat for advice. You can ask all your burning tax questions and get answers from a real human expert.

Price Preview feature. A common complaint about online tax preparation software is that the price you pay at the end is not always what was advertised at the beginning.

Filers who think they are using free software are especially upset when they see the total at the end and have to decide between paying the fee or forfeiting hours of work for a cheaper or free option.

Do note: If you add features as you go or change your package, your price will change as well, but H&R Block will be immediately transparent about this.

H&R Block Tax Software Packages and Prices

Some of H&R Block’s products can be on the pricy side (though not as pricy as the industry gold standard, TurboTax).

But these higher prices get you a rather intuitive user experience and solid in-app advice. For example, you start the process off by checking which situations apply to you, like “own a home” and “self-employed” — to easily determine which product you need.

Here’s what you get with each package offered by H&R Block in 2019.

H&R Block Free

Cost for federal: $0

Cost for state: $0

You get more with H&R Block’s free package than you do with those offered by TaxAct and TurboTax. Not only can you file a 1040, but you can also file Schedules 1 through 6 (which is not offered in the free versions of TaxAct and TurboTax). Both federal and state are free to file.

This package is ideal if you just have regular income through W-2s and if you rent instead of own property. Even those with slightly more complicated tax situations — like those with kids and/or student loans — can use the free version.

H&R Block no longer has a basic product. Most of the features previously offered in its paid basic version are now included in this free version.

Note on prices: H&R Block frequently updates prices during tax season. We have provided ranges to give you an idea of what to expect. Reference the H&R Block website for current prices before filing.

H&R Block Deluxe

Cost for federal: $22 to $50

Cost for state: $36.99

Homeowners — or anyone who wants to itemize — will need to pay for the H&R Block Deluxe package, which offers support for mortgage interest and real estate taxes.

The Deluxe product is also great for filers with a health savings account or nondeductible IRA, or those who need to optimize donations and who want access to tax returns in future years (up to six with Deluxe version). Deluxe filers also get phone support during filing.

H&R Block Premium

Cost for federal: $38 to $70

Cost for state: $36.99

If you make money in less conventional ways — like as an independent contractor (with expenses under $5,000) or as a landlord — H&R Block’s Premium tax software is well-suited to your needs.

Premium offers support for Schedules D (income from investments, like sales of stock) and E, as well as the independent contractor form, C-EZ. With the Premium package, you can import expenses from apps such as Stride.

H&R Block Self-Employed

Cost for federal: $60 to $104

Cost for state: $36.99

As a freelancer, I would use H&R Block’s Premium product, as my expenses are low. However, small business owners or independent contractors with high expenses should use H&R Block Self-Employed, which allows you to deduct expenses for your office, vehicle, asset depreciation and more.

The Business Booster even helps you to write off your start-up costs. H&R Block’s Self-employed package also includes the full Schedule C form.

Of special note: Uber drivers can automatically import driver tax information using the H&R Block Self-employed package.

H&R Block Tax Pro Review

Cost for federal: $119.99

Cost for state: $36.99

New this year is H&R Block’s Tax Pro Review, which includes all tax forms. With this package, a tax pro will thoroughly review, sign and e-file your return.

Pros and Cons of H&R Block Tax Software

There are advantages and disadvantages to using H&R Block, but we find the benefits far outweigh the pitfalls.

Pros of Using H&R Block Tax Software

Free version: The free version of H&R Block’s tax software is the most comprehensive on the market. Unlike TaxAct and TurboTax, H&R Block offers support for Schedules 1 through 6.

Free chat: No matter the package you purchase, you will get access to free and unlimited live chat support.

Ask a Pro and Tax Pro Review: Though pricy, these two services instill a great deal of confidence when filing. You can do live screen share and ask questions of tax experts in real time, and you can have a tax pro review your entire return to point out potential mistakes or opportunities for more deductions and credits.

Price Preview: The luxury of transparency cannot be understated. As someone who has filed with TurboTax and ended up paying way more than I originally imagined, I see immense value in H&R Block’s Price Preview tool that updates you as you go should you make choices that incur additional costs.

Brick-and-mortar locations: If you want in-person help to pair with your online filing experience, you can visit one of H&R Block’s 11,000 locations. Be aware: This option will cost you.

Easy filing process: You can import your W-2 and 1099, log in from various devices and access H&R Block’s extensive library of information. H&R Block even offers mobile apps for Apple and Android devices.

Previous tax returns: All versions (both free and paid) of the H&R Block tax software allow you to import previous returns from other tax prep companies.

Worry-Free Audit Support: I highly recommend spending the additional $19.99 to purchase H&R Block’s Worry-Free Audit Support, which gets you an enrolled agent who will guide you through an audit should you have the misfortune of being selected for this lovely process. This package includes audit prep, in-person representation and IRS correspondence management.

Amazon refund bonus: If you put a portion (or all) of your refund on an Amazon gift card, Amazon will add 5%. That can be substantial: For every $1,000 of refund you get, you can earn $50 with Amazon.

Cons of Using H&R Block Tax Software

Price: H&R Block tax software isn’t cheap. After purchasing your package — and potentially adding on services like Worry-Free Audit Support and Tax Pro Review — you could be looking at a couple hundred dollars. This is significantly more expensive than TaxAct, but you get what you pay for.

TurboTax comparison: TurboTax is more expensive — and it’s not just because of name recognition (though that’s certainly part of it). TurboTax’s interface is easier to use. Most critics, including this one, enjoy TurboTax’s interview style to determining your deductions, tax situations, forms, etc. H&R Block, on the other hand, requires some knowledge of what you’re doing. While all the filing options are available to you, you might have to do some legwork to determine which apply to you.

Certification: When you pay for tax pro help with H&R Block, you might not actually be getting help from a certified tax professional, like a CPA. Some tax pros on the company’s payroll are indeed certified, but others have just undergone training to be able to offer support.

H&R Block vs. TurboTax vs. TaxAct

For many, H&R Block is like Baby Bear in the Goldilocks fable. TaxAct’s features and support are too minimal.TurboTax’s prices are too exorbitant. But H&R’s blend of value and quality? Well, that’s juuuuust right.

The table below compares these three online options by cost (federal and state filing), level of support offered and available tools.

Please note: Prices vary during tax season based on timing and special promotions; as we get closer to April 15, expect prices to go up. The table reflects pricing at time of publishing.

Another (not so) fun fact: The fee for filing state tax is for a single state. If you worked in multiple states or moved from one state to another in 2018, you will have to pay more than once to file with all necessary states. I moved last year, but fortunately, the state from which I moved (Tennessee) has no state taxes, so I dodged a double bullet there.

H&R Block TurboTax TaxAct Price ranges provided. Tax software prices will fluctuate throughout tax season. Costs for Federal Free: $0 Deluxe: $22 to $50 Premium: $38 to $70 Self Employed: $60 to $104 Tax Pro Review: $119 Free Edition: $0 Deluxe: $30 to $40 Premier: $60 to $80 Self Employed: $90 to $120 Free: $0 Basic+: $10 to $15 Deluxe+: $30 to $48 Premier+: $40 to $58 Self Employed+: $60 to $78 Costs for State Free: $0 All other plans: $36.99 Free Edition: $0 All other plans: $39.99 Free: $0 Basic+: $19.95 All other plans: $39.95 Level of Support Ask a Tax Pro service (unlimited chat and screen share), price varies by package; Tax Pro Review for $119.99 federal and $36.99 state filings; free 24/7 tech support; brick-and-mortar locations for assistance, but that comes at a fee. TurboTax Live Basic for $89.99 federal and $29.99 state (essentially is the free version of TurboTax but with on-demand video access to an actual tax professional, who provides a final review); video tutorials; in-app chat; etc. Minimal, but increases with higher-tiered packages; ranges from online FAQs to phone and in-app chat, though reviews of these support options aren’t kind. Tools Can pay for Tax Pro Review; has good in-app tools (like W-2 import, a searchable database and links to important information). Most user-friendly interface on the market; basic in-app tools (like W-2 import, chat/interview experience for filling out, etc.) Basic in-app tools (like W-2 import and calculators); improved over previous years, but still rudimentary.

H&R Block Tax Software Review: Should You Use It?

Though H&R Block is expensive, it is well worth the cost. H&R Block’s tax software is easy to use, has free live chat and is now available with (admittedly expensive) options for additional help and tax review.

Plus, with more than 11,000 locations, you can easily visit an office if you get stuck while filing, though this will incur an additional cost.

The biggest appeal of H&R Block for those with limited needs is the free version. Of the industry’s three big players (H&R Block, TurboTax and TaxAct), the H&R Block tax software gives you the most options and support with its free variant.

About H&R Block

H&R Block was founded in 1955 by the Bloch brothers. Any guesses at their two initials? Brothers Henry and Richard Bloch were both passionate about helping Americans navigate the complexity of the tax system.

While Henry is still an honorary chairman, Richard pursued a role in the fight against cancer after surviving it himself in the 70s. H&R Block has grown tremendously in the last 60 years, with roughly 11,000 retail offices globally.

You can learn more about H&R Block here.

Timothy Moore is a market research editor and freelance writer covering topics on personal finance, careers, education, pet care, travel and automotive. He has worked in the field since 2012 and has been featured on sites like The Penny Hoarder, Debt.com, Ladders, Glassdoor and The News Wheel.

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.

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