IRS Lists 25 On-Line Tax Preparation Services

by Mike Godfrey, Tax-News.com, New York

25 February 2002

The IRS Internet site, www.irs.gov, lists more than 25 Internet-based tax preparation programs, and points out in their favour that it takes the average taxpayer 13 hours to complete a federal tax return by hand. About half have their taxes prepared by a professional, who might themselves use an Internet-based solution, but that still leaves a large market of unassisted individuals for tax-preparation software.

Competition in the field has intensified in the past year, particularly among password-protected interactive Internet sites. But choosing which product to buy or use is far from simple in itself. Not all programs include state tax calculation, and many don't include the actual filing step.

USA Today has examined a number of the more popular products, and says that web-based programs are usually cheaper. E-filing is usually included in the price, and many don't charge you until the filing stage. On the other hand there may be delays in downloading the program, and many of the web programs aren't as comprehensive as boxed tax software. Prices range from less than $10 for a no-frills web-based program to more than $40 for fully loaded software.

The paper looked at TaxGaga.com (simple, but not a good choice for taxpayers with lots of questions), TaxACT and TaxACT Online (a good choice for taxpayers who thirst for knowledge about the tax code, but there are annoying commercials), H&R Block TaxCut (tries to anticipate where you're going before you get there, but again the pitches can be annoying), CCH CompleteTax (a clean, simple Web-based program for people who like their tax preparation straight, but sometimes lapses into jargon), and Quicken TurboTax (still the most comprehensive tax-preparation program available, but another commercial-heavy site).

Recommended