Filing federal and state tax returns can be challenging, especially if your tax situation is unique.
Hiring the services of a professional can be costly, and you may not want to prepare and file your tax returns completely on your own for fear of wasting time and making mistakes.
FreeTaxUSA’s tax preparation and filing services are geared towards helping military personnel and veterans with their federal and state tax return filing. FreeTaxUSA offers two plans to choose from, as well as several high-value features to make tax return filing easier.
In this review, we’ll take a look at FreeTaxUSA’s features, cost, and benefits to help you decide whether you should file your taxes with the software this year.
Factors Impacting Your Taxes in the Military
As a service member, you need tax software that accommodates your unique situation and that assists you in getting the biggest refund possible when you file your taxes.
You need tax software that accommodates filing for:
- Combat pay exclusion
- Job search expenses
- EITC for non-taxable combat pay
- Uniform deduction
- Reservist travel deductions
- Deductions for moving expenses
FreeTaxUSA is one service which can help with your unique tax considerations.
Let’s look at how it works.
How FreeTaxUSA Works
FreeTaxUSA has an interface that prepares your tax return by asking you questions. As you enter information, the software completes your return and calculates your tax refund or liability.
Since it provides a step-by-step process, preparing your return is easy, and you only have to give the information that the system asks from you.
The interface is straightforward and intuitive. The interface also displays a real-time tracker of your tax refund, and you will be able to see how the information you enter affects your tax refund or liability.
After you have provided all your information to the platform, you will be able to review and print your return on paper or PDF before instructing the system to submit your tax return to the IRS via e-file or mail.
FreeTaxUSA offers several benefits to their Free and Deluxe clients which help to streamline your taxes.
FreeTaxUSA’s software supports claims of more than 350 itemized deductions and credits on your federal income tax returns to decrease your taxable income.
Import Information for the Previous Year
One feature that is available for free is the carryover of the tax and personal information that you entered the previous year.
If you are using FreeTaxUSA for the first time, you can import your information in PDF format from a competitor or third-party platforms to save time and to ensure that there are no transcription errors.
Online Return Backup
Upon completion of your federal or state tax return, the system will back up your return online so you can come back later to review or print your return. You may also amend your return for a nominal fee.
FreeTaxUSA’s filing history feature allows you to compare your tax situation, refund, or liability with the figures of the previous year to gauge your financial performance.
Report Complex Income
Both the Free and Deluxe versions support Schedules C, E, and D, allowing you to report income from self-employment, property rentals, capital gains transactions, and several types of income related to K-1.
Audit Assist is one of the most prominent features FreeTaxUSA has to offer.
Audit Assist is only available to clients who bought the Deluxe plan and includes access to tax professionals who can answer your audit-related questions and help you prepare for an IRS audit.
It also provides clients with access to FreeTaxUSA’s Audit Center, which is a library of information on the audit process and specifics.
Note that this program doesn’t include audit assistance with state returns or audit representation.
FreeTaxUSA will, however, help you to respond to the IRS’s correspondence and advise you on the steps you have to take and the records to prepare for the audit.
If you submit incorrect tax calculations, you may have to pay interest or a penalty to the IRS. FreeTaxUSA guarantees the accuracy of their tax calculations, and if there are any mistakes on the system’s end, they will pay any consequential fines.
Clients that use FreeTaxUSA’s Free plan can head over to the Customer Support page to find solutions for issues in the support topics.
Free plan users can also email customer support.
Deluxe version clients can get help from the support team via live chat or visit the Q&A database to find answers to their questions.
FreeTaxUSA Versions – Free vs. Deluxe
When signing up for FreeTaxUSA’s services, you can choose from two versions:
In terms of accommodating tax situations, these plans are very similar.
Both programs offer free federal filing, and both the Free and Deluxe plans charges a fee of $12.95 per state tax return filed.
Both plans are also suitable for major tax situations including home ownership, joint filing, self-employment income, and income from investments and rental property.
There is, however, a difference between the two plans regarding customer and audit support.
The free plan features a number of complementary services, including federal return filing, account information carry-over from the previous year, completed tax return online backup, federal tax extensions, advanced tax filing, and tax return printing.
You also get access to add-on services at a one-time fee.
These services include return printing and binding, priority customer support, and tax return amendments.
Audit Assist is not available to Free plan users as an included or add-on service.
If you receive an audit notification from the IRS, you will have to upgrade to the Deluxe plan to receive assistance.
The Deluxe plan features all the included and add-on services of the Free plan, as well as Audit Assist.
With Deluxe, you also receive free federal filing, but state filing has the same cost for Deluxe as it has for the Free plan.
The Free plan is entirely free unless you opt for one of the add-on services. The Deluxe plan’s base price is $6.99.
Considering that this plan includes filing for complex returns as well as Audit Assist, it is one of the most affordable programs available.
As mentioned above, there is a flat rate for state tax filing of $12.95. If you have a basic tax situation but have to file for state taxes, you may be able to find a free solution elsewhere.
FreeTaxUSA offers several military discounts for taxes, including 10% off sitewide or 10% off at checkout.
If you use the Free version, as a service member, you can prepare, print, and e-file your taxes at no additional costs.
However, costs and discounts are always subject to change. To view the FreeTaxUSA’s latest fee structure, visit their website.
- Affordability: FreeTaxUSA is one of the most affordable tax software options on the market.
- Free version: The software offers free federal tax filing.
- Support: Tax support from the support team comes as a relatively low cost.
- Complexity: Both the Free and Deluxe versions support complex tax return filing for self-employed and property rental income as well as capital gains and losses.
- Audit assistance: Comprehensive Audit Assistance with access to FreeTaxUSA’s Audit Center.
- Access: Customer support via chat and email.
- Import options: Online tax return back up and information carryover from year to year.
- State filing: There are no plans available for free state tax filing.
- Customer support: Customer support doesn’t have the same quality as competitors
- The interface doesn’t have an attractive design
Don’t let your taxes get you down – take advantage of a program that will do the heavy lifting for you.
FreeTaxUSA offers some of the most affordable services out there, but customer support is limited and the forms on offer aren’t completely comprehensive.
Give some thought to how much help you’re going to need before committing, and if the pros outweigh the cons in your situation, consider filing with FreeTaxUSA.