TurboTax is one of the most popular tax preparation software programs in the United States. As of December 2017, TurboTax has over 25 million users and continues growing. Over 60 million people use online tax services to file their taxes each year, which means that the competition for customers is high. Understanding how TurboTax makes money can help you decide if this service is right for you. If your needs are simple and you prefer to pay a reasonable one-time fee rather than subscribe to monthly services, then TurboTax could be a good option for you.
How Much Does TurboTax Cost?
The cost of TurboTax varies depending on the version you choose and whether you are a new or existing customer. If you are new to the software, you will pay $59.99 or $79.99 for the Basic or Deluxe version, respectively. If you choose to upgrade to the Premier version, you will pay $89.99. Current customers can use their existing login information at turbotax.com to access their account and select the version they want to file their taxes. If you are a new customer, you will pay $39.99 to file your federal return and $29.99 to file your state return. The price of TurboTax can increase if you have additional dependents or complicated tax situations. You can use TurboTax’s price estimator tool to see how much the software will cost you based on your specific circumstances.
Turbotax Free Edition
TurboTax’s free edition allows you to file federal and state income taxes for free if your situation is basic. For example, you might be a student or have a simple W-2 job. You must select the free edition of TurboTax if you are eligible for the IRS Free File program. Maybe you can use the free edition to file your federal and state taxes if you have simple deductions such as interest or health care costs. You cannot use the free version of TurboTax if you have self-employment income, rental properties, complex investments, or education credits. Keep in mind that TurboTax’s free edition is not really free. You are under no obligation to buy the software after you file your taxes.
TurboTax Live Review
If you need help filing your taxes, TurboTax Live is a good option to consider. Working with a customer service agent can be helpful if you want to file certain deductions or are unsure how to complete certain parts of your taxes. TurboTax Live agents are available from 9 a.m. to 5 p.m. EST seven days a week, so you can file your taxes whenever is convenient for you. Keep in mind that you will have to pay for the service if you use TurboTax Live. You will pay $59.99 to file your federal taxes, and $29.99 to file your state taxes through TurboTax Live. You can also use the live service to get help with your W-2, 1099, and health insurance forms. TurboTax Live agents can walk you through the process of inputting information into the software and can provide general advice about your taxes.
TurboTax Review: Which Version Should You Choose?
Choosing the right version of TurboTax can be difficult if you are new to the software. Make sure to carefully select the version that best suits your needs before you begin filing your taxes. If you are unsure which version to choose, you can use the price estimator tool to get an idea of how much each version will cost you. TurboTax Basic is the most affordable option if you have simple deductions such as interest or health care costs. Deluxe is a good choice if you have additional dependents or want to be able to create your own investment portfolio in the software. TurboTax Premier is a more expensive but advanced version of the software that allows you to import your brokerage transactions. Depending on your situation, one version of TurboTax may be better than the others.
How Does TurboTax Make Money?
TurboTax is a for-profit company that makes money by selling the tax preparation software. The company makes money from both the free and paid versions of the software. If you use the free version of the software, TurboTax makes money by selling your information to third parties for marketing purposes. The paid versions of the software come with a guarantee that you will not receive a higher tax bill than you would using a free service. If you use the paid version of TurboTax and receive a tax bill, you can receive a refund by filing an appeal with the company.