H&R Block has one of the most recognizable brands of any American business. Its distinctive green square beckons from TV screens, strip malls, and corner storefronts. Even many small towns have a standalone H&R Block office, and you certainly don’t have to go far to find one in a bigger city. For many Americans, H&R Block is synonymous with in-person tax preparation.
But H&R Block also makes one of the most popular online tax preparation programs. It’s ideal for a wide range of tax situations, though people with very complicated taxes may feel more comfortable walking into a physical H&R Block office and shouldering the additional cost.
H&R Block’s pricing plans occupy a middle ground between affordable, somewhat more DIY services such as TaxACT and TaxSlayer, and pricier, but more novice-friendly, services like TurboTax. Accordingly, H&R Block’s online tax filing system might be the best choice for budget-minded folks who have basic familiarity with online tax filing (and taxes in general), but who don’t quite have the confidence to put together a potentially complex tax return (such as one requiring a Schedule C, D, E, or K filing) entirely on their own.
Plans, Pricing & Features
H&R Block uses an interview-style tax preparation process that methodically guides you through your federal and state returns, making sure you’ve entered all sources of income and checked for all appropriate credits and deductions along the way. You need to complete these sections in order – you can’t choose what to work on at what time, and can only skip forward to sections that have already been completed. Certain versions of other programs, such as TaxACT, are more DIY-friendly.
You can select any of the four pricing plans to start. If you attempt to do something that isn’t supported by your current plan, H&R Block prompts you to upgrade and doesn’t allow you to continue your return until you do.
For all of these plans, H&R Block has an accurate calculation guarantee: If the software makes an error that results in an IRS penalty, H&R Block agrees to pay that penalty and any associated interest, up to $10,000 per tax year.
This version is ideal for filers with relatively simple tax situations, including those who need to itemize deductions and report ordinary dividend or interest income. However, you can’t file Schedule EIC (for the Earned Income Tax Credit) with this plan. Filing your federal return is free, while each state return costs $9.99.
- Itemized Deductions. You can itemize your deductions (file Schedule A) with this version. If you’re not sure whether to itemize, H&R Block’s interview questions can guide you towards the appropriate choice.
- Support for Schedule B. Filers with more than $1,500 in ordinary dividend or interest income generally need to file Schedule B. This version provides full support for doing so, including checks for relevant credits and deductions.
- W-2 Importing. This plan allows you to import unlimited W-2s and record all W-2 income, which is a big help if you have multiple jobs.
- Past-Year Return Importing from Competing Tax Prep Services. This plan comes with free importing for prior-year returns, in PDF format, from TurboTax and TaxACT, but notably you can’t import last year’s return from H&R Block.
- Support for Affordable Care Act Requirements. After you enter your personal information, you’re immediately asked a series of questions about your health insurance coverage during the tax year. All versions of H&R Block support all the forms and documentation necessary to prove that you had adequate coverage for the entire year, or to handle penalties if not.
- 5% Refund Bonus. If your federal refund totals at least $100, H&R Block offers a 5% bonus when you accept part or all of it as a gift card from any of several dozen retailers, including Best Buy and Target. (You can choose more than one retailer.) For instance, if you get a $500 refund and accept it all as a gift card to Best Buy, your card’s starting balance will be $525.
This plan is very similar to the Free plan, with the major differences being better importing capabilities and access to prior-year returns. It costs $39.99 to file a federal return and $39.99 for each state return.
Basic comes with all the features of the Free plan, plus the following:
- Access to Past Tax Returns for Six Years. The Basic plan offers free access to returns prepared and filed with H&R Block for six years.
- Past-Year Return Importing. You can import all the information on previous years’ H&R Block returns, as well as prior-year returns from TurboTax and TaxACT.
- 1099 Importing. You can automatically import 1099s from a range of financial institutions, including Fidelity, Vanguard, and Charles Schwab.
- Support for Earned Income Tax Credit Filers. If you’re eligible for the Earned Income Tax Credit, you need to file Schedule EIC. This version supports everything you need to do so.
- Free Live Technical Support. The Basic plan comes with free, live (phone and live chat) technical support for filers who have issues with the H&R Block at Home software itself. This is separate from H&R Block’s free, unlimited tax professional access, which is available live to all filers (including those using the Free plan).
The Deluxe plan, which costs $54.99 for your federal return and $39.99 for each state return, is ideal for filers with capital gains or losses from investments, retirement income, and those who made charitable donations (cash and non-cash) with a total value in excess of $500 during the tax year. It also offers a juicier refund bonus.
It comes with all the features and functions of the Basic plan, plus:
- Support for Filers With Charitable Donations. This version offers detailed guidance and support for those who made cash and non-cash charitable contributions in excess of $500 during the tax year (IRS Form 8283).
- Support for Schedule D. If you incurred capital gains or losses from the sale of securities, real property, and other assets, you likely need to file Schedule D. H&R Block Deluxe offers support and guidance for Schedule D filers.
- 10% Refund Bonus. The gift card refund bonus increases to 10% with the Deluxe plan. All other conditions of the program remain the same.
The Premium plan is ideal for business owners, landlords, the self-employed, and others with complex tax situations. It costs $74.99 for your federal return and $39.99 for each state.
The Premium plan comes with all the features and functions of the Deluxe plan, plus:
- Support for Schedule C. If you’re liable for self-employment tax – as most independent contractors, consultants, and sole proprietors are – you’re required to file Schedule C or Schedule C-EZ. The Premium plan provides all the support necessary to do so, including double-checks for all relevant credits and deductions. If you’re not sure whether you qualify as self-employed, check the IRS website.
- Support for Schedule E. If you own and earn income from rental real estate or pass-through entities (such as S-corporations, trusts, estates, and certain types of partnerships), you’re likely required to file Schedule E. Premium offers full support for Schedule E filers, including all supplementary forms, and double-checks for credits and deductions.
In addition to its paid plans, H&R Block includes the following noteworthy features and add-ons for all customers:
- Free Chat Support for Tax-Related Issues. All H&R Block customers have free and unlimited access to tax professionals via live chat. The live chat feature is operational from 10am to 10pm Monday through Friday, and 9am to 5pm on Saturday and Sunday, all times Central Standard Time.
- Real-Time Refund Updates and Explanations. As you prepare your return, you may notice that the amount of your federal refund – visible on the left sidebar – fluctuates with each new piece of information entered. These updates occur in real-time and come with detailed explanations as to why they’ve changed, a useful feature if you want to learn more about how taxes work.
- Create Your Account Later. H&R Block allows you to begin preparing your tax return without actually creating an H&R Block account. You still have to create one before you file and pay, or if you want to be able to save your return, exit, and come back later.
- In-Person Audit Support. H&R Block offers free, in-person audit support to all filers, regardless of plan. Support is available at your local office and includes reviewing and interpreting notices, recommending and helping you gather documents to respond to an audit, reviewing audit findings, and offering advice on how to respond (including how to appeal, though H&R Block’s free audit support doesn’t include appeals). If you didn’t prepare your return with H&R Block, this service is available for a fee (which varies by office).
- Pay With Your Refund. H&R Block allows you to pay for its tax preparation services with your federal and/or state refunds, eliminating the need to pay upfront when you file. There’s a processing fee of $34.99 to pay your federal filing fees with your federal refund, and $13 per return to pay your state filing fees. You can’t pay your federal filing fees with your state refund or vice-versa.
- Prepaid Debit Card Refund. H&R Block lets you receive your refund as an Emerald Prepaid MasterCard, a reloadable prepaid debit card. Once you’ve spent your refund, you can continue to reload the card and use it as you would any other MasterCard-branded payment card. Fees for reloading, ATM withdrawals, and other activities may apply, but there’s no setup fee or monthly maintenance fee.
- Help Finding Health Insurance. H&R Block partners with GoHealth, an independent company, to help customers find private health insurance policies on state or federal insurance exchanges. Though you don’t have to file your taxes with H&R Block to find policies through GoHealth, this is a super-convenient feature if you’ve waited until tax filing time to get health insurance.
1. More Affordable Than Some Alternatives
H&R Block offers a great mix of affordability and comprehensive service. Though the Free version isn’t able to handle complex tax situations, the Deluxe and Premium versions certainly can – at a lower cost than TurboTax. And even H&R Block’s Free and Basic plans can handle more complicated items than TurboTax’s. For instance, you can itemize deductions and file Schedule B with the Free plan. That’s not possible with TurboTax’s free plan. The Basic plan even lets you report investment and rental income (Schedules D and E).
2. Free, In-Person Audit Support Inspires Confidence
H&R Block is supported by a network of about 10,000 physical tax preparation franchises. If you receive a request for clarification or formal audit notice from the IRS, the company makes its tax professionals available to assist you for free – regardless of the plan you used or whether you filed online. This audit support system is far more robust than many of H&R Block’s competitors, including TurboTax (which charges $39.99 for in-person support) and TaxACT (which also requires you to pay for audit support and doesn’t arrange in-person meetings).
3. Refund Bonus May Be the Best in the Business
H&R Block’s refund bonus allows you to boost your federal refund by up to 10% when you choose to receive part or all of it (with a minimum of $100) as a gift card. A 5% (for Free and Basic plans) or 10% boost (for higher-priced plans) and the fact that you can choose from several dozen gift card issuers (including big names such as Target, Petco, and Zappos) makes this the best refund bonus initiative around.
By contrast, many smaller tax prep programs don’t have refund bonuses. And TurboTax, which offered a 5% refund bonus in past years, discontinued the deal for the 2015 tax year.
4. Upfront, Detailed Look at Affordable Care Act Issues
After collecting your personal information or importing your return, H&R Block immediately dives into the Affordable Care Act with a series of questions about your health insurance coverage during the tax year. It also offers detailed explanations regarding why it’s asking each question and how your answers could affect your tax burden.
As one of the most impactful, visible, and potentially confusing changes to the tax code in recent years, the Affordable Care Act is intimidating to many filers. By getting it out of the way early and providing detailed explanations about its implications, H&R Block removes a possible source of worry and preoccupation. Other programs, including TurboTax, wait until later in the filing process and don’t offer such detailed explanations.
5. No Need to Create an Account Right Away
H&R Block’s Create Your Account Later feature is the closest I’ve seen an online tax software program get to offering the guest checkout options that are commonplace at online retailers. While you can’t actually complete your return without creating a username and password (not to mention giving H&R Block your contact information), this feature makes it easier to “try before you buy” without putting as much skin in the game. Other tax filing programs, including TaxACT and TurboTax, make account creation a prerequisite to begin your return.
6. You Can Pay With Your Federal and State Refunds
H&R Block allows you to pay both your federal and state tax prep fees with your respective refunds. This means that you don’t have to pay for any of its services upfront, which can be convenient if cash is tight and you’re relying on your tax refund to see you through. Other tax prep programs, including TurboTax and TaxACT, don’t allow you to pay with your state refund.
7. Free, Unlimited Tax Advice at All Levels
Every H&R Block plan comes with free, unlimited access to experienced tax advisors (via live chat) during the company’s extended business hours (10am to 10pm during the week, CST, and 9am to 5pm on weekends). If you’re stuck on a tax issue, you don’t have to upgrade your plan to speak with an expert or wonder whether you’ll be limited to a finite number of questions when you do make contact. By contrast, TurboTax’s lowest-tier plan doesn’t come with support from tax experts – a potential drawback for tax prep novices.
8. Access to Physical Branches Is Offered
Audit support isn’t the only reason you might want to walk into a physical H&R Block branch. If your situation is more complicated than you anticipated and you’re not confident enough to complete your return on your own, your nearest H&R Block shop probably isn’t far. And if you have a question or concern during the filing process, you can pick up the phone and call someone who lives and works nearby – not an overworked customer service specialist in a faceless call center somewhere. TurboTax, TaxACT, and TaxSlayer all lack the personal touch that comes with physical outposts.
1. Paying With Your Refund Can Be Expensive
Though it’s convenient that you can pay for H&R Block’s tax prep services with both your federal and state refund, it doesn’t come cheap. H&R Block charges a $34.95 processing fee when you pay for your federal return with your federal refund, and a $13 fee when you pay for your state return with your state refund. Put together, these are the stiffest refund payment processing fees of any tax prep program. By contrast, TaxSlayer doesn’t charge any fees when you pay with your refund.
2. May Require You to Make Some Important Decisions on Your Own
H&R Block’s interview process isn’t quite as thorough as some alternatives. Depending on your situation, it may present you with some general information and ask you to make a potentially important decision on your own – as opposed to evaluating your situation based on your answers to specific questions, and then suggesting a course of action. For instance, when I noted that I’d gotten married during a previous tax year, I was only presented with a brief primer on my options for filing status (e.g. file together, file separately, head of household). While informative, it wasn’t comprehensive enough for me to use to make an informed decision and a couple of the points were confusing.
By contrast, when you tell TurboTax about a life change, the program asks you several relevant questions before presenting you with a recommendation. This approach takes the guesswork out of weighty considerations, such as filing status and itemizing deductions.
3. Limited Importing From Other Online Tax Prep Programs
H&R Block only allows prior-year return importing from two external programs: TaxACT and TurboTax. If you’re a previous customer, you can also import prior-year information from H&R Block itself (for all versions except FREE). While these three programs are popular, millions of people don’t use them to prepare and file their taxes every year. For them, switching to H&R Block can be a tedious process that involves entering lots of basic information that’s already saved elsewhere. And to add insult to injury, choosing the “Skip Import” option when beginning your return prompts a stern warning: “This is your only chance to import last year’s return.”
4. Limitations to Navigation Within Your Return
H&R Block’s interview process and navigation system may be too methodical for experienced filers. Once you begin your return, you can’t skip over sections that don’t pertain to your tax situation. Instead, you have to answer each question in order before moving on to the next section. Only after you complete a particular part of your return can you navigate back (or forward) to it without going through all the intervening interview questions again.
By comparison, TaxACT’s Deluxe version allows you to choose which sections you want to work on and when. If you know that a particular section doesn’t apply to you, that can save you valuable time.
Choosing an online tax preparation program isn’t a decision to make lightly. Whether you’re in line for a refund or know you’ll owe some money to the IRS or state treasury, you’re surely concerned about minimizing your tax liability. And if you have a complex tax situation, you need to avoid making major mistakes or omissions on your return – which could raise your risk of an audit.
H&R Block has a lot of great features, a long track record, and a well-known brand behind it. But it’s not the only choice out there. Before settling on your final choice, take some time to review as many options as possible.