How to Compare Tax Preparation Software Prices

Each year, new tax laws send taxpayers scrambling to professional services for tax preparation assistance. As the software improves and new laws arise each year, consumer confidence grows. With multiple software versions and editions available, and higher prices for additional features, comparing prices requires some research. It is necessary to decide which options are most suitable for your tax needs in light of relative cost.

Instructions

1. Examine popular brands of tax preparation software. The two primary packages are TaxCut and TurboTax, but you may want to consider other software manufacturers. Try installing the free trial versions to examine the interface. Consider your preferences and previous experience with a particular brand. If you are more comfortable with one or had a bad experience, that may affect your decision. Importing data from previous years can save valuable time, so you may want to stay with the same brand. If you prefer to change, check the features to see if importing data from other brands is supported.

2. Check what versions or editions are available once you have decided on a brand. In addition to the annual versions of the software required to accommodate new tax laws, various editions are produced for specific needs. Generally, the more features available in an edition, the higher the price. Basic or standard editions are usually the cheapest. Some are even free. If your tax needs are simple, the last is your best option.

   Deluxe, premier or premium editions include additional features, such as forms for itemized deductions, investments and rental property and may include software for filing state taxes. Home and/or business editions include features for contractor, consultant, small business and corporation needs. State editions may be sold separately or sold in a package with certain specialized federal editions.

3. Begin shopping, whether at a local store or online. Large chain stores may have to stock mass quantities and pass along these savings. Office supply and software stores may stock editions you cannot easily find elsewhere. Another consideration is an online or downloaded version. This may save money, since the cost of advertising is not included in the price. You may also activate a free trial version.

Tips & Warnings

• Consider variables such as rebate offers, additional costs for state editions and filing fees.