TurboTax Review 2011 – Online Tax Preparation Software

Owned and operated by software giant Intuit, TurboTax is backed by a solid company history of almost three decades. You’ll have no trouble trusting this product. It has a superb reputation and reliable software platform.

TurboTax is the most popular of the online tax filing and preparation software products. Last year more tax filers filed with TurboTax than all the other tax filing software products combined.

Key Features and Benefits

• Guarantees they will get you “the biggest refund you’re entitled to.” If you use another tax preparation method and get a bigger refund, TurboTax will refund your money.
• Covers over 350 tax deductions – however, many deductions and credits are only checked if you use the Deluxe, Premier or Home & Business versions.
• Gets you the fullest value for your donations. The built in program “ItsDeductible” provides the values for over 1,000 donated items – but here again you must use the Deluxe, Premier or Home & Business versions.
• The Deluxe edition helps you calculate if you qualify for medical expense deductions.
• Shows where you stand with your refund or what you owe every step of the way – love this feature! No surprises.
• Makes its software easy to use for first time users, TurboTax sticks by you every step of the way with special guidance on how to use the software and get the most benefits from it.
• Saves your information from the previous year, and then asks questions about changes in your life that might affect your taxes. Not available in the Free and Basic editions.
• Can do federal and state taxes at the same time, without entering information twice.
• You can do as many federal returns as you want, with five free federal e-files included, so you can prepare federal taxes for multiple members of the family without paying anything additional.

Online Security
While no online program is 100% safe against hackers, viruses and those seeking to rip off your personal information, TurboTax stores your information on a fire-wall protected server which can only be accessed by you with a unique sign-in and password. The program uses the same encryption technology commonly used by banks to e-file your return.

Advantages

• Start all returns (with the exclusion of the Business edition) for free and don’t pay until you are ready to file. If you have items that are only addressed in a more expensive version, it’ll prompt you to upgrade at that time.
• You don’t have to install or download anything – you can do all of this online.
• Free technical support with Basic, Deluxe, Premier and Home & Business editions.
• Checks for errors as you input information, reducing errors by typo.
• Also available as a download or CD, if you’d like to do it offline.
• You can store information from year to year, and it also allows you to import some forms directly, or look up your W-2′s using their database.

Disadvantages

• It will try to get you to upgrade your product on almost every step of the way. Not all forms are supported in all versions, so it’ll prompt you to upgrade if you need something that’s in a more expensive version – or even if you don’t. The promotional pop-ups throughout free edition process can be annoying.
• Additional fee for state filing.
• TurboTax is a computer software program and can only do what it is programmed to do, so if you need in-depth tax help and preparation for a complex financial situation it is best to seek out a professional tax consultant.

Available Packages

The TurboTax website has a popup window which asks you several simple questions to help you determine the best package for you. Each edition can only take you so far if you have to claim items such as self-employment taxes or investments, so it’s helpful for it to determine ahead of time what you need. You’ll also receive telephone support with any paid version, and can e-file your federal return for free. Your state return will be an additional $36.95 – the prices below are for federal taxes only.

Free Edition – FREE
This one is strictly for those that have a straightforward filing status like those who are entitled to use the 1040EZ and other simple returns. If you don’t have very complicated taxes, you can start off with this version and see if you need to upgrade based on your tax situation.

Basic – $19.95 (for a limited time)
This version is for individuals who don’t have a mortgage or charitable deductions, and can use form 1040EZ. While you’ll have access to a larger database of credits and deductions, many people who don’t have to use the Deluxe version or higher could probably use the Free version and get the same results if their taxes are very simple.

Deluxe – $29.95 (for a limited time)
The Deluxe version is the most popular version, which will cover most common situations. If you own a home, have medical expenses, make charitable donations, or want to itemize, you’ll want to use this version. This one includes everything the Free Edition has, but helps you maximize your deductions, since it will check their database of more than 350 tax deductions and credits. You can use their W-2 and 1099 database to fill in your info from more than 100,000 participating employers – fewer typos!

Premier – $49.95 (for a limited time)
Includes everything in the Free and Deluxe Editions, but lets you figure in investments such as stocks, bonds, mutual funds and rental property. Programmed to calculate gains and losses, Premier can also search for tax-saving rental property deductions. It will help you keep track of your investments’ cost basis, assist with mortgage refinancing deductions, and help you set up new rental properties, among many other items.

User Feedback: Hey everyone. This is Andrew (Editor and Admin) here at Money Crashers. I used TurboTax Premier for the first time and just e-filed. I wanted to add my personal experience to this review and say that TurboTax did an awesome job throughout the way. TurboTax asked very simple questions throughout the review to guide me from beginning to end. I had some questions along the way which were easily answered by their FAQ’s and forums as well as one phone call I made to the company. Very responsive and helpful. I’m definitely planning to use TurboTax in the future (especially now that it will save all my info so it will be even quicker next time). Highly recommend based on my experience with the product.

Home & Business – $74.95 (for a limited time)
This edition is for those who are sole proprietors, consultants, contractors, or single owner LLC’s. It includes everything in the Free, Deluxe, and Premier Editions, but helps you get the biggest deductions personally and for your business all in one. It’ll also look for deductions specific to your industry and help you prepare 1099s and W-2′s for your employees or independent contractors. This edition is great for those of us with small businesses who run a one-man or woman show, and it’ll file your personal taxes too.

User Feedback: I’m Gyutae, another editor and admin here at Money Crashers. I run a few online businesses and figuring out taxes every year can get pretty complicated (and stressful!). Thankfully, TurboTax Home and Business makes everything pretty simple – without the need to consult with a CPA. The interface is simple and easy to use and the TurboTax system guides you through the process to get you the biggest deductions possible. I admit that I was a bit skeptical at first. I always thought going through a tax professional was the only way and that tax software was for “cheapos” (especially for businesses). After this year, however, I think I’ll be using TurboTax for many years to come. This way, I can take more of a “hands-on” approach while learning more about the tax laws/process and I don’t even need to be a pro to do it. If you run a single-person business of any sort, I highly recommend you try out TurboTax Home and Business.

Business – $129.95 (for a limited time)
If you run an S corporation, partnership, C corporation, or multi-owner LLC, you’ll need to upgrade to the Business version. While Home & Business is sufficient for one-person small businesses, if your situation is more complex you will need the extra guidance it provides. It includes all the features of lesser editions, and can also help business owners get the most deductions possible with these more complicated setups.

Is It Right for You?

If you fall under any of the groups listed above no matter whether you are filing a 1040 EZ or a multi-member LLC, TurboTax should have the right product for you.

TurboTax is the online choice of the majority of tax e-filers. It is easy to use and can help you understand some of the more difficult areas such as deductions and corporate tax elements. However, their helpful ways can be a bit annoying in some stages, but luckily this is one feature you can turn off if wish. You don’t have to finish your entire return at once. Instead, you can save and come back to it and if you think you missed something along the way, there is a handy “back button” to use that doesn’t delete the information you previously entered.

Overall, TurboTax is a really simple-to-use program that gets you through the return quickly with a minimum of tax knowledge needed. It can handle very complicated returns easily, and imports information from prior years to save you time. I’d highly recommend it, especially if you are a tax newbie or have a more complicated return this year.

Looking to file your taxes online using a different service? See a comprehensive comparison of TurboTax vs TaxACT vs H&R Block At Home.