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, along with popular competitors such as Liberty Tax and Jackson Hewitt.
But H&R Block also makes one of the most popular online tax preparation programs. It’s ideal for a broad 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 complicated tax return entirely on their own (such as one requiring a Schedule C, D, E, or K filing).
If you’re returning to H&R Block to file your 2016 taxes, don’t expect to find the company’s famous refund bonus deal anymore. That deal, which boosted filers’ refunds by as much as 10% when they accepted part or all of their refunds on retailer gift cards, appears to have been discontinued.
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.
1. Free (H&R Block More Zero)
Dubbed “H&R Block More Zero” for the 2016 tax year, this version is ideal for filers with relatively simple tax situations, including those who need to itemize deductions, report ordinary dividend or interest income, and file Schedule EIC (for the Earned Income Tax Credit). Your federal and state return are both free.
- 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 appropriate credits and deductions.
- W-2 Importing and Photo Upload. 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. New for the 2016 tax year, you can upload your W-2s simply by snapping a smartphone pic and using the secure photo upload tool.
- Importing Other Forms. You can also import a variety of other forms, though not photographically: 1095-A, 1099-DIV, 1099-R, and 1099-INT.
- Past-Year Return Importing from Competing Tax Prep Services. This plan comes with free importing for prior-year returns from other tax prep services (including popular options such as TurboTax and lesser-known services such as TaxHub). Oddly, though, you can’t import your prior-year return from H&R Block – you need Basic for that.
- 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.
- Refund Advance Loan. If you choose to complete your tax return in an H&R Block storefront location, you can take advantage of the company’s Refund Advance Loan. It’s a 0% interest cash advance loan on your expected tax refund, with a maximum principal of $1,250.
- Best of Both. H&R Block’s Best of Both feature lets you pause your online return at specific “checkpoints” (usually between sections of the return) and have your work reviewed or changed by an in-house tax professional without schlepping to an H&R Block office. There’s an additional fee associated with Best of Both service that’s customized based on the extent to which the professional examines and alters your return. You’ll receive a price quote before filing.
This plan is very similar to the Free plan, with the primary differences being better importing capabilities and access to prior-year returns. It costs $29.99 to file a federal return and $39.99 for each state return, plus a $19.95 state e-file fee.
Basic isn’t heavily advertised on H&R Block’s online filing website, and it requires a separate software download. Still, it occupies a middle ground between the free version and the Deluxe version, so it’s worth checking out if it seems like the most cost-effective fit for your situation.
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 most other online tax prep services.
The Deluxe plan, which costs $34.99 (for a limited time – normally $54.99) for your federal return and $36.99 for each state return, is ideal for filers with 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 Schedule C-EZ. If you’re a freelancer or independent contractor with substantial self-employment income, but minimal business expenses, you can likely file Schedule C-EZ (rather than the full Schedule C, which is more involved). Deluxe provides all the necessary forms and support to complete Schedule C-EZ. If you’re not sure whether you qualify as self-employed, check the IRS website.
- Support for Filers With Charitable Donations. This version offers detailed guidance and support for those who made cash and non-cash charitable contributions more than $500 during the tax year (IRS Form 8283).
- Expert Chat Support. Deluxe filers have free, unlimited chat access to H&R Block’s in-house tax experts during posted business hours. This is different from the Best of Both service, as these experts don’t directly alter your return and you’re not charged extra for their work. It’s worth noting that this feature used to be available at all price points, but was discontinued for lower-priced plans before the 2016 tax year.
The Premium plan is ideal for business owners, landlords, the self-employed, filers with capital gains or losses from investments, and others with complex tax situations. It costs $54.99 (for a limited time – regularly $74.99) for your federal return and $36.99 for each state.
The Premium plan comes with all the features and functions of the Deluxe plan, plus:
- Support for Schedule C. If you own your own business or have substantial income from business activities and valuable business deductions to match, you’re likely required to file Schedule C. The Premium plan provides all the support necessary to do so, including double-checks for all applicable credits and deductions.
- 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.
- Support for Schedule E. If you own and earn income from rental real estate and certain other sources, 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.
- Support for Partnership and Trust Income (Schedule K-1). If you earned income from a partnership, trust, or S-corporation, you’re likely required to file Schedule K-1. H&R Block’s Premium version provides all necessary support for this.
In addition to its paid plans, H&R Block includes the following noteworthy features and add-ons for all customers:
- Free Chat Support. All H&R Block customers have free and unlimited live chat access to technical support staff capable of answering basic questions about the service and helping with troubleshooting. 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 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 underpinned 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 Taxct (which also requires you to pay for audit support and doesn’t arrange in-person meetings).
3. 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.
4. 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.
5. 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. 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.
8. Best of Both Is Convenient for Busy Filers
If you want the peace of mind that you can only get from having a professional human review and/or prepare your tax return, but don’t have the time or scheduling flexibility to bring your documents into a physical H&R Block office, H&R Block’s Best of Both service is right up your alley. For an additional fee that won’t be higher than H&R Block’s in-person prep fee (and will likely be less), Best of Both entitles your return to comprehensive professional review and editing. It’s ideal for busy people whose tax situations are more complicated than they initially appear.
9. Robust Importing from Other Tax Prep Programs
Once upon a time, H&R Block only allowed prior-year return importing from two external programs: TaxAct and TurboTax. If you were a previous customer, you could also import prior-year information from H&R Block itself. Needless to say, despite these three programs’ popularity, this disadvantaged millions of filers who used other online prep programs.
Not anymore. In time for the 2016 tax year, H&R Block expanded its importing capabilities to include most common file formats, and therefore virtually all online tax prep programs. No matter where you filed last year, there’s a good chance you can switch to H&R Block without manually re-entering all your data.
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 your refund(s), it doesn’t come cheap. H&R Block charges a $34.95 processing fee when you pay for your federal and state return in this manner. (Though, to be fair, H&R Block no longer charges a separate fee to pay your state prep fees with your state refund.) This is stiffer than most other tax prep programs’ – for instance, 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. 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.
4. Refund Bonus Discontinued for 2016 Tax Year
H&R Block appears to have discounted its generous refund bonus, which boosted filers’ federal refunds by up to 10% when they chose to receive part or all of it as a gift card. H&R Block joins the ignominious (and growing) list of
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.
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 undoubtedly concerned about minimizing your tax liability. And if you have a complicated 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.
For more options, check out our full list of Top-Rated Free Online Tax Preparation Services.