- Review Date: 01/26/2012
- Bottom line:
With its expanded support of mobile devices and a family of personal tax preparation sites whose usability and support resources have a slight edge over the competition, TurboTax remains the solution to beat.
New mobile offerings. Free phone calls and online chats with tax professionals. Faster this year. Best overall user interface and navigational system. Plentiful, easily accessed guidance.
Price; state excessive.
As much as personal tax preparation software and Web sites have evolved over the last 20-plus years, they still can't anticipate every possible user question or accommodate every imaginable tax scenario.
But Intuit's TurboTax family of sites comes closer than anyone.
The big takeaway this year is not what's in TurboTax. It's where it's available: everywhere. Intuit's new mobile offerings make it possible for you to sweat every detail of your 1040 while you're in your home office, riding the train to work, sitting in a restaurant—anywhere. The entire TurboTax line has been optimized for the Apple iPad, and additional apps are available for the iPhone and Android operating systems.
The other significant piece of news for the 2011 tax year is the availability of tax professionals (CPAs, Enrolled Agents, and tax lawyers) for questions from taxpayers. Unlike in the past, these phone calls and online chats are free, and you can request as many as you'd like.
Little has been done to the core site itself, with one big exception: It's faster. All of those pretty fonts and icons and graphics have had impact on performance in previous years, but I was pleased to see that speed was improved this go-round.
I reviewed TurboTax Premier Online 2011. As always, you don't have to pay until you print or e-file, and pricing remains the same as the 2010 versions: $49.95 for the federal version, and still a whopping $36.95 for state. Though the state version imports the data you so carefully prepare in the federal edition, there's not nearly as much to it. Granted, every state has different tax laws and they change every year, but this still seems excessive. No other online tax product is as expensive as TurboTax, all things considered.
Each TurboTax site looks and works much like the ones a step lower on the Intuit food chain. But as you go up the chain, each level adds on its own extras and is increasingly sophisticated. Conveniently, you can start your prep on one and transfer your work to another if you find the first one lacking. Competitors also offer multi-tier product lines with in-place upgrading.
A free e-file is included with each of these products:
- TurboTax Federal Free Edition Online. Actually contains many major forms and schedules, including the 1040, 1040A and 1040EZ; Schedules A and B; several 1099s; and a whole host of others, but it lacks the powerhouse Schedules C-F and step-by-step guidance. State version, $27.95.
- TurboTax Basic Online. Adds step-by-step help. Federal, $19.95; state $36.95.
- TurboTax Deluxe Online. Handles more complex deductions, like home mortgages, medical expenses, charitable donations and childcare expenses. Also hunts down those you may have missed. Federal, $29.95; state, $36.95.
- TurboTax Premier Online. Comes with special guidance and resources for taxpayers who have investments and/or rental property. Federal, $49.95; state, $36.95.
- TurboTax Home & Business Online. Basic, Deluxe and Premiere include the Schedule C/EZ (a simplified version of the Schedule C), but this top-of-the-line personal tax prep site is the best choice for sole proprietors, consultants, 1099 contractors or single-member LLCs who want extra guidance on entering business income and expenses. Also lets you prepare unlimited W-2 and 1099-MISC forms. Federal, $74.95; state, $36.95.
CD-based desktop versions are still available, but they're significantly more expensive. H&R Block and TaxACT, too, have desktop versions, but CompleteTax is online-only. For example Premier costs $89.95 direct for the CD or download version.
Guiding You Through
Intuit likes to call TurboTax a GPS for your taxes. It's an apt description. Thanks to a clear navigational system and a plethora of help resources, 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.
The opening screens ask for your personal information (address, Social Security number, etc.), providing blank fields, check boxes and drop-down lists here and throughout the site (if you're missing information as you proceed through the site, you can flag it with the tool provided and come back to it later). The program divides the 1040 into its assorted forms and schedules, taking your answers and doing any calculations necessary, and then dropping them into the correct fields in the background.
Moving on, you'll visit each of four more sections: Federal Taxes, State Taxes, Wrap-Up and Print & File. You'll do the lion's share of your work in the first, as it's divided into:
- Wages & Income (salaries, interest and dividends, investments, retirement funds, etc.)
- Deductions & Credits (mortgage interest and property taxes, home energy credits, child and dependent care, charitable donations, medical expenses, estimated taxes, etc.)
- Other Tax Situations (Alternative Minimum Tax, Underpayment Penalties, Nanny and Household Employee Tax, etc.)
- Federal Review (list of topics you may have missed; TurboTax will take you to the appropriate screen and bring you back to the review if you've forgotten something)
- Error Check (TurboTax examines your return for errors and opens a small window displaying the related area of the form, so you can fix it)
The Wrap-Up section does a final review, estimates your risk of an audit (no guarantees, of course, but you can pay $39.95 for representation in case the worst happens) and provides some suggestions for next year's tax planning. Every site offers its own version of these tasks, and while I've never found this follow-up to be particularly enlightening, TurboTax does it as well as anyone.
More Navigational Guiding and Guidance
Experienced users can wade in and select the topics they need to visit, but more timid taxpayers may want to opt for the EasyGuide, which breaks the current content down into more manageable chunks and digs down further into the issue. Navigational buttons throughout help you advance to the next screen, revisit the previous one, or move you into the data-entry section for individual topics. Lost? Click Tools, and you can see an outline of the site's screens, highlighting your location. If you think you've missed something along the way, you can search or browse through a list of tax topics and forms and let TurboTax take you there.
Every competing site has its own bag of tricks when it comes to the most critical element of personal tax preparation: guidance. What do you do when you don't know an answer? What do you do if you don't even understand the question? TurboTax offers the most routes to help resources in a more accessible, understandable way than its competitors. It's not a slam-dunk, though; all of these sites would serve you well when you're stumped.
Click on hyperlinked words and phrases, and a small window containing an explanation opens. If that's not enough, there's a link to Live Community, an interactive forum of peers and experts who ask and answer questions. Similarly, "Learn More" and "Explain This" links appear frequently. These and other abbreviated help topics, like the Glossary of Deductions and Credits, are written in a friendly, informative style.
Click on the Get Expert Help button, and the TurboTax Help Center opens a mostly blank screen. You can either click the Browse FAQs button to see a directory of frequently asked questions arranged by topic or type a question into the big box at the top. If you do the latter, a list of links to recommended answers opens, as well as links to the free access to tax experts via online chat or phone. Wherever you are, you can get a little bit of help or a lot, in language that a non-CPA can understand.
A Close Field of Contenders
Tax preparation solutions had hit something of a wall a couple of years ago. They'd all incorporated about all of the tax topics that were reasonable to include in products that were to be used by taxpayers who were tackling the 1040 on their own. In fact, these sites are actually capable of completing very complex returns for users who are confident in their abilities. How much more guidance could they offer, and would more interface tweaks really make a huge difference?
But then the mobile world exploded, with the introduction of the iPad and the proliferation of iPhones and Android smartphones. And Intuit beat the competition to the punch, offering three smartphone apps and an iPad-optimized version of TurboTax. Even if it wasn't just better enough than the other sites reviewed here—in navigation, usability, guidance, and interface excellence—to win an Editor's Choice once again, Intuit's entry into the mobile world make it our number one for the 2011 tax year.