For those reasons, we recommend using H&R Block Free Online to save money only when you’re filing a basic return with a student loan or tuition deduction.
We ran into a couple of problems trying to hunt down stray forms, and the automated chat help was ineffective.
However, the software was also more error-prone, especially as the complexity of returns increased. In our tests, we found H&R Block’s help screens and in-app guidance to be nearly as good as TurboTax’s. If you have those student forms and only a handful of other forms to file, such as a W-2 and bank interest income, this is the best way to file for free. Unfortunately, our top pick, TurboTax Free Edition, doesn’t support filing those forms. Student loan interest and higher-education tuition and fees are valuable deductions you can take even if you file with the standard deduction. TurboTax Free Edition doesn’t cover filing with those deductions.
If you have a simple return and student loan interest or tuition payments, you should file for free with H&R Block Free Online instead. Thanks to the Tax Cut and Jobs Act passed a few years ago, most people will benefit from taking the standard deduction ( 90% of taxpayers filed with the standard deduction in 2019).
The reason is simple, although not obvious if you’ve never used TurboTax before: If you start with TurboTax Deluxe and enter all your information only to find that the standard deduction is more valuable than itemizing, you’ll have to either pay the Deluxe fee ($39 at this writing, plus $40 per state) or clear out all the information and start over with the Free Edition.
Even if you might have some deductible expenses, such as mortgage interest or charitable donations, it’s better to start here and upgrade to Deluxe only if you’re required to. Although TurboTax bills its Free Edition “for simple tax returns only” and recommends TurboTax Deluxe if you want to “maximize tax deductions and credits” (who doesn’t?), we think most people should start with the Free Edition. TurboTax is the best online tax software because of its thorough and intelligent interview process. Unlike TurboTax Free Edition, H&R Block Free Online covers the student loan interest deduction and the tuition and fees statement, so you’ll save about $40 on your federal return plus another $40 on your state return (at this writing), if you have only those additional forms to file.Ĭonfused yet? Here’s a flowchart of the options we recommend this year: