Think of ways you like to spend your time and filing taxes is never going to be top of the list. Unfortunately, it’s said that only two things are inevitable in this life: death and taxes. Fortunately, taxes need not feel like death with a little help from the best tax software available.
Taxes can be complicated and just because you got them right last year doesn’t mean the same rules apply this year – the goal posts are constantly shifting. Do I need to declare my cryptocurrency? How do I incorporate my side gig? Why did the tax code change last year?
There’s no doubting that taxes can be stressful and time-consuming. This is compounded by the fact there is little margin for error. Incorrectly filing your taxes can result in:
- An IRS audit notice
- Late payment penalties
- Negligence penalties
- Fraud penalties
- Interest rates applied to money owed
- Paying more than necessary
- Potential criminal proceedings
Making a mistake on your taxes is not going to land you in jail unless those ‘mistakes’ were purposeful. However, a mistake will most certainly result in a loss of time at the very least and quite possibly, loss of income. Some of the most common mistakes individuals make on their tax returns include:
- Filing too late or (yes, even) filing too early
- Incorrect social security numbers
- Misspelled details (names, addresses, etc.)
- Mathematical errors
- Entering information in the wrong section
- Not declaring all necessary income
- Not taking entitled deductions
These are just a handle of the top mistakes. Mistakes the IRS sees time and time again. Mistakes that result in loss of earnings and a waste of time for hard-working Americans up and down the country. The solution? Save time, money, and stress by using tax software.
What does Tax Software do? How can it Help Me?
Tax software makes filing your taxes immeasurably more straightforward. It will guide you step by step through all the information you need to include, find tax deductions you are entitled to, and review your submission before it’s filed to ensure everything is as it should be.
It was once the case that taxes were fairly straightforward. The average worker was salaried with few investments outside of a 401(k). These days, many Americans have more than one income stream and diversified investment portfolios. Couple that with personal life events such as marriage/divorce, death/life, health complications, etc. and the picture becomes even more complex.
While a personal accountant may be preferable in certain situations (e.g. if you run a sizeable business or just inherited a complex estate), for the average citizen they are unnecessary and good tax software is more than sufficient. There are a few factors to consider when choosing the best program for you, but here are some key points to consider:
- Supported forms – Do you earn a salary from an employer? You will need a W-2 form. Earn from other forms of income? A 1099 form is needed. Paid any taxes abroad? A 1116 form. Based on the complexity of your tax situation you need tax software that supports the required forms.
- Support options – We can all benefit from talking to a helpful expert from time to time. Many services offer video, text, and phone chat with tax advisors. If this is something you believe you would benefit from, make sure to choose a service with comprehensive support.
- Audit support guarantee – Filing taxes is one thing. Going through an audit is a different headache entirely. That’s why the best tax software offers an audit support guarantee with every tax return, completely free guidance from a tax professional should an audit happen.
- Highest refund guarantee – Tax software searches 100s of tax deductions to get you the maximum refund you are entitled to. Some companies are so confident they will get you the best result possible that they will refund the difference (and pay you a fee) should you find a cheaper filing elsewhere.
- Pricing – Prices vary wildly between services, largely dependent on how complex your individual situation is and how much support you want throughout the process. If you are confident you know your stuff you may be better off choosing a more basic option. If you are unsure, it can be money wisely invested to opt for a package with greater support.
To save you even more time, we have compiled three of the best tax software companies for 2023 for you to choose from:
How we picked the best Tax and Accounting Software for 2023
Choosing the wrong tax and accounting solution can cost your business time, money, and resources. But what if you have neither the time nor knowledge to pick the best one? Don’t fret! Our team has made the buying process easy by testing several of the top solutions in the market. We screened each of the vendors based on the following factors:
- User Interface
- Post-Sale Support
Tax Software - Frequently Asked Questions (FAQ)
💻 Do I need to use tax software?
It is possible to file your taxes manually. However, the time and effort required means that few Americans do. Another alternative is to use an accountant who will do the legwork for you. While this may be suitable for business with employees or certain personal circumstances, for the average individual tax software is more than enough.
🏡 Can I use tax software if I have experienced a major change of circumstance?
Marriage, divorce, birth, death, and moving home can all turn an otherwise straightforward tax return into a complex mess. Tax software will guide you through the process, ensure all necessary information is included, and apply any new deductions you are entitled to.
🔎 Can tax software make mistakes?
Many of the best tax software services offer comprehensive reviews of every submission and 100% accurate calculations guaranteed. Some also promise to pay IRS penalties should any be incurred. If this is a concern of yours, make sure to opt for a service with an accuracy guarantee.
💬 Should I use free tax software?
Free tax software is typically suitable if you have a very simple tax return, for example, W-2 income only and claiming the standard deduction. For those with more complex situations like house ownership, dependents, or an investment portfolio, a paid tax software will provide everything you need and ultimately save you money.
Transparency and Trust: The aim of this website is to help you find the perfect software for your needs in an easy-to-view comparison list. You can read more about how we review and about our background in the About Us section of this website. Software.fish does not feature all of the software available in the market, we cherry-pick what we consider to be the leaders in each vertical. We try to keep this site updated and fresh, but cannot guarantee the accuracy of the information as well as the prices featured at all times. All prices quoted on this site are based on USD so there could be slight discrepancies due to currency fluctuations. Although the site is free to use, we do earn commissions from the software companies that we have partnered with. If you click on one of our links and then make a purchase, we will get paid by that company. This has an impact on the ranking, score, and order in which the software is presented in our list and elsewhere throughout the site. Software listings on this page DO NOT imply endorsement.