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Taking tax preparation software for a test drive

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I tested the online versions of three well-known tax preparation software offerings, TurboTax, H&R Block and TaxAct. Each has strengths and weaknesses.

TurboTax makes doing taxes about as easy as it can be, short of hiring a preparer. Block's help is best. And TaxAct is a bargain. At $17.99, its Ultimate Bundle was far cheaper than TurboTax Home & Business, at $74.99, and Block Premium, at $49.99. (Prices can change throughout the tax season.)

Based on the 2013 return for my wife and me, any of the three will work fine for a straightforward filing — consisting of, say, wages, interest and dividends, and common deductions like those for mortgage interest and charitable contributions.

Here's a summary of my triumphs and travails with each program.

TurboTax

If you want ease and speed, TurboTax is the choice. It imported the most information — W-2s, investment reports and all of the nonnumeric entries from our 2012 return — and did so with just a few clicks.

With that convenience comes a measure of annoyance: Embedded in TurboTax are copious come-ons for other services and products, including Mint.com, a personal finance website, and IRA's sold by well-known financial companies.

Some of Intuit's add-ons can make tax preparation easier. The company makes Quicken, a personal finance program, which tracks spending, savings and investments. You can click Quicken information directly into TurboTax. And Intuit provides a website called ItsDeductible for logging charitable contributions. I recommend using the site: It will store smartphone pictures of items given to charity and help you value them — and your charitable gifts can be imported, too.

I tested the help option by asking a question about a weeklong trip to China. For my wife, it was mostly work; for me, mostly sightseeing, interspersed with a couple of business meetings. I wanted to know whether we could deduct part of my airfare. I opted for online chat, waited about 10 minutes and then exchanged messages for another 10 or so with a representative. I never received a definitive answer. Instead, the rep directed me to TurboTax online guidance about business-related travel.

H&R Block

I encountered problems when using Block this year, though none seemed to affect the accuracy of our return. They just made the task more onerous. Part of the problem was probably me; I'm as deft with computers as a chimp with a tuba.

The Block website wouldn't work with my browser, Safari — some of the buttons did not respond to my clicks — so I switched to Firefox. Then I signed in and tried to import a PDF of last year's return. Little of the information transferred. Pulling in income data stymied me, too. The program said that our W-2s and Vanguard account reports were not yet available, though those had flowed into TurboTax. Once I accepted that I was going to have to type more, Block worked fine.

On the plus side, Block's help was the best. I posed the same China question via online chat. Within about a minute, I found myself in touch with a representative, who soon told me that I could deduct none of the airfare. She said the trip did not meet the IRS eligibility requirements for business-related travel abroad: I'd spent too little time on work.

TaxAct

Importing data into TaxAct presented the same problem I had with Block. I couldn't make the PDF transfer work and had to accept the toil of typing. TaxAct also did not pull in as much data from outside companies. It does not, for example, link to Vanguard or Fidelity. And though the program said it could fetch our W-2s, I failed there, too.

TaxAct's help was the slowest. I had to call; online chat wasn't available. When I did, the operator insisted that I prepay for my return. (The other companies let you pay when you file, even if you seek help.) Once I paid, I was transferred to the help line, where I spoke with a representative about the China trip.

We talked for about 15 minutes. She wasn't sure of the answer; she told me she would research the question and email me within 24 hours. Her response arrived within 30 minutes. She sidestepped the original question, telling me where to put the information on the return if I decided to deduct.

Taking tax preparation software for a test drive 02/21/14 [Last modified: Sunday, February 23, 2014 5:58pm]
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