FreeTaxUSA vs TurboTax: Which is Better for Tax Season?

Tax season is upon us! If you're still trying to file your taxes, rest easy. There are some great tax preparation tools out there, some of which don't charge anything to file your federal taxes if you meet certain qualifications. FreeTaxUSA and TurboTax are probably the most famous of these services. In fact, you've likely seen their ads on TV, ad banners, and social media, competing with Credit Karma Tax and other free e-file provider services. But which one is the best for you to use? Read our head to head comparison of FreeTaxUSA vs TurboTax to find out!


Expensive but chock-full of services, TurboTax may be a good value for your dollar. However, it's important to be aware of its pricing structure before you use it. Not all tax returns qualify for TurboTax's free filing service.

TurboTax is an Intuit service. You may know them already from Quickbooks and Mint, both of which are services that they own. We talk a little bit about Mint, as well as its competitor, Personal Capital, in another article. However, what's important to know about Intuit is that they're very much in the business of individual financial management. TurboTax is targeted at the same person who might use Mint or Quickbooks: the average taxpayer.

When Is It Free?

First of all, it's important to understand that not everyone can file federal and states for free through TurboTax. You only qualify for free income tax filing if you meet the following conditions:

  • You're claiming the standard deduction
  • There's a W-2 in your tax documents
  • You get Earned Income Credit
  • Low or no interest on a 1099 form
  • You get Child Tax Credits

Normally, we'd warn you about something that seems too good to be true. Situations where you seem to be getting something valuable for nothing, especially on the Internet, are usually scams of some kind. However, TurboTax is not a scam.

People who have more complicated taxes, including people with self-employment income or income from rental properties, use TurboTax Deluxe, TurboTax Premier, or TurboTax Self-Employed. TurboTax also sells software that covers these three advanced services. The revenue Intuit makes from these products more than pays for the cost of e-filing the paperwork of people who qualify for free e-filing.

Costs For The Premium Services

TurboTax's Deluxe edition costs $69.99, plus state filing fees of $64.99, and covers maximum deductions and credits. TurboTax Premier is for people with investments and rental properties. It'll cost you $89.99 to file your federal return this way, plus the cost of filing a state return.

TurboTax is probably the most recognized name in software-based tax prep of individual returns. You can purchase TurboTax software in stores, but there is also TurboTax online. The parent company of TurboTax, Intuit, allows integrations between its other products like Quickbooks and Mint and its flagship tax filing solution. This might make TurboTax the best tax software for some users.

But is TurboTax a free tax preparation solution? Let’s take a look at some different scenarios. We’ll even give TurboTax the benefit of the doubt by using their “tax season” sale prices:

TurboTax “Free” Edition
Your Tax Situation: The cost:
I have a job $0
I have dependents $0
I received unemployment this tax year $39
I own a home $39
I donated to a charity $39
I sold stock or crypto $89
I own rental properties $89
I’m self-employed, a gig worker, contractor, or freelancer $89

cash money

If your taxes are simple, but you'd like some extra help with them anyway, then you can also buy TurboTax Live. This is the basic TurboTax module plus on-demand video help from a TurboTax accountant. It costs $89 to file federal taxes, while the state filing cost is $64.99. You can also upgrade the premium services with Live, which hikes their prices considerably.

TurboTax Live Assisted Basic
Your Tax Situation: The cost:
I have a job $0
I have dependents $0
I received unemployment this tax year $89
I own a home $89
I donated to a charity $89
I sold stock or crypto $169
I own rental properties $169
I’m self-employed, a gig worker, contractor, or freelancer $169


TurboTax Live Full Service starts at $89. Keep in mind that this is just for the cost of your annual federal tax return.

TurboTax Live Full Service
Your Tax Situation: The cost:
I have a job $89
I have dependents $159
I received unemployment this tax year $159
I own a home $249
I donated to a charity $249
I sold stock or crypto $289
I own rental properties $289
I’m self-employed, a gig worker, contractor, or freelancer $389


If You're Self Employed

No matter what your gross income from self-employment may be, you still have to make quarterly taxes for Social Security and other federal benefits, the cost of which your employer would normally deduct from your paycheck. These payments are collectively known as the self-employment tax. They're due on April 15, July 15, October 15, and January 15. If you're not sure about whether you count as self-employed, then it's worth your while to check the IRS's web page on the topic. Then, to get our take, head over to our piece on what income sources you absolutely must report in order to stay out of trouble with the IRS.

State Returns Cost More

Also keep in mind that filing a state tax return with one of TurboTax's for-cost services will cost $64.99, regardless of what service you use. If you can file for free, you won't be charged for that part of your filing.


TurboTax prices change often, so consider this a snapshot of their typical service costs and check their website often for specifics. Also, be aware that active duty military personnel and reservists get a discount on premium services. Some lower-ranked service members even get to file for free.

Benefits Of Each TurboTax Service

If you file your income tax with TurboTax for free, you'll get a basic suite of services.

  • Audit guidance
  • Access to the online community
  • A free tax return

As they say in the business, you get what you pay for. Each deluxe version of TurboTax builds upon these benefits significantly. For example, if you spring for TurboTax Deluxe, you'll have access to the form for homeowner tax breaks, Schedule A. You'll also be able to do the following:

  • Claim charitable donations
  • Get personalized help from a TurboTax specialist
  • See your credit score

If your tax situation involves investments, you might use Premier and enjoy support for gains and losses from cryptocurrency, as well as increased investor support. TurboTax Self-Employed offers support for rideshare drivers and online freelancers, as well as guidance on claiming expenses.

Cross-Platform Access

Although it's pricey, TurboTax has a lot of significant benefits, not least of all the fact that you can access it on your phone. That's not just a convenience, either: this service lets you take pictures of your W2s and upload them that way. In other words, once your employer or employers give you those pieces of paper, you're not going to have to type in all of its information. Instead, you can use your phone to take a picture of the document, upload that to your TurboTax account, and then log into that same account on a computer and continue your taxes there.

User Experience

People love how easy-to-use TurboTax is. There's no jargon – if there's something you need to know, you'll see it in plain language, often in a link, right there on the page. TurboTax also addresses common questions, like “What if my employer sent me an additional W-2,” and features a comprehensive help section.

There aren't many ways to feel confident about doing your taxes if you're not an accountant. This is one of them.

Woman using a smartphone

Customer Support

Here's where TurboTax really excels. The site itself hosts a lot of great video tutorials by experts, which are accessible even if you don't pay for Live. That said, Live may be worth the money if you're really stuck. A CPA will review, or even sign and file, your return if you use Live. You can also file at night if you'd like. Live agents are available from 8 am to midnight, seven days a week. This service appears to be available year-round. Keep in mind that you're not likely to draw the same CPA each time you use the service – TurboTax connects you to an available person. Still, you're guaranteed a chance to talk to an expert.

Reviews generally love TurboTax's online services and software. Part of this could be because TurboTax gives all of its customers audit guidance. That means that if you do get audited, you'll get advice from CPAs to help you understand what's going on. TurboTax will even represent you before the IRA – for a fee, of course. Max Defend & Restore, TurboTax's audit defense product, costs $39.99.

Getting Your Tax Refund

If you want to get a direct deposit of your refund into your bank account, TurboTax can accommodate you. However, if you'd prefer to receive it in a preloaded credit card, that's also an option. You can also get a check, pay for next year's taxes, load the refund onto an Amazon gift card, or use the refund to buy U.S. savings bonds. If you take the Amazon option, you'll get an extra 10% added on.

Best of all, you can pay for TurboTax's service with your refund. There's an additional $39.99 charge for that, though. The clear winner among these options is to take the refund as an Amazon gift card and use that for necessities. This is not a good time to go on a shopping binge! Invest wisely in groceries and household consumables, especially if you've got free shipping through Prime.



Cheaper and bare-bones compared to TurboTax, FreeTaxUSA might be a better option for budget-conscious filers. However, it also doesn't feature the same amount of assistance and protection that TurboTax provides.

FreeTaxUSA is a product of Tax Hawk Inc., which owns a number of tax preparation websites. This small company, the brainchild of a CPA and a team of software engineers, opened its doors in 2001. The point was to offer free and low-cost tax preparation on the Internet. Since then, it's become a staple of the free tax preparation landscape.

When Is It Free?

As far as your federal tax return goes, always, unless you want additional customer support. It doesn't matter what your income is, what kind of itemized deductions you've got to deal with, your earned income tax credit, or what your adjusted gross income is. Your federal tax return is free with FreeTaxUSA.

Filing a state return isn't quite free, but it's very cost-conscious. Altogether, it brings the entire cost of your return to $14.99.

Piggy bank with a coin
Image from Pixabay


The $14.99 charge for filing state taxes isn't a big deal next to TurboTax's range of $100+ prices. Even if filers spring for FreeTaxUSA Deluxe, the total price of this service will come to $21.98. That's quite a deal, considering.

As long as you're confident that you'll avoid an audit, there's no doubt as to which service is the better deal.

Doing your tax return with FreeTaxUSA is really (as advertised) a free file—at least for your federal return. Your state return will cost you money, but even that is only $15. If you’re wondering what the “catch” is, it’s that FreeTax is a DIY tax prep option, with very limited customer support for filing, unless you pay for it. Let’s take a look.

Tax Situation Federal eFile State eFile
W2 Employee $0 $14.99
Freelancer $0 $14.99
Contract or Gig Worker $0 $14.99
Homeowner $0 $14.99
Dependents $0 $14.99


Yes, it’s really free for both W2 employees and 1099 freelancers. This is in contrast to online tax software that touts itself as free but is only free to 37% of filers (e.g. TurboTax). Also, the $15 state filing is much better with FreeTax or when comparing TurboTax vs H&R Block.

Product Purpose Price
Deluxe Support Live chat with agents for customer assistance $7.99
Pro Support Phone-based, personalized tax advice $39.99
Audit Defense Protect yourself if the IRS audits your return. $19.99
Prior Year Returns Missed returns from the last six years. $0 Federal + $17.99 state
Professionally Printed Return Keep a hard copy $7.97
Professionally Bound Return Keep a bound hard copy $15.99
Unlimited Amendations Change your return as many times as you’d like $15.98 current year

$17.97 previous years

$0 with support packages


Unlike TurboTax, FreeTaxUSA offers only online tax filing. There's no software and nothing to download. However, like TurboTax, you can make an account that allows you to sign in and continue your return where you left off. You can even jump to different devices depending on your immediate circumstances. The site works well on mobile devices, including smartphones. However, unlike TurboTax, you'll need to input your W-2 information manually. There's no fancy scan function available with this product.

However, many users may see FreeTaxUSA's straightforwardness as an asset. Bells and whistles often confuse people. The stress of choosing the right deluxe plan compounds an already-stressful time of the year. FreeTaxUSA offers a service that TurboTax can't: simplicity.

User Experience

The FreeTaxUSA interface is extremely basic and bare-bones. It also features a handy navigation bar on the left side of the page, but the help option is far more limited than what TurboTax has available. Generally, if you try to use the help function, you can either view the most-used topics or view topics that are specifically associated with the page that you're on at the minute. For example, if you're entering your W-2 information, the available help topics will be about W-2s. However, if you want to upload PDFs of your prior annual taxes, FreeTaxUSA will let you do that.

While it's quite simple, FreeTaxUSA's interface is serviceable and clear. Like Turbo Tax, it is an IRS-approved e-filer. While it doesn't offer the level of help that TurboTax does, it's just as functional when it comes to actually doing your taxes. Nevertheless, this may be a better option for people who feel secure about their taxes already. There's a lot less hand-holding with this service, and while it may be a better bargain up-front, it's most important to avoid an audit.

Customer Service

FreeTaxUSA does not offer audit protection for users of its basic package. For that, you'll need to pay for its $6.99 Deluxe package. Even then, it doesn't appear that FreeTaxUSA represents you before the IRS. It offers advice and assistance but doesn't otherwise get involved in your tax audit journey. Unlike TurboTax, which operates in several different niches, FreeTaxUSA is strictly a tax preparer. It's the filer's job to protect themselves in the event of an audit.

A calculator and a page of financial calculations

Deluxe users also receive live chat support for their tax returns, which is probably worth $6.99. The good news is that FreeTaxUSA makes it very easy to purchase Deluxe anywhere in the process. If you decide halfway through that you need help with tax forms or earned an income tax credit, you can get it for under $10.

Getting Your Tax Refund

Like TurboTax, FreeTaxUSA provides refunds through direct deposit and paper checks. Getting a prepaid debit card is also an option. The Amazon gift card that TurboTax offers isn't an option here, and nor is the option to pay for FreeTaxUSA's service with your refund. That said, FreeTaxUSA is also quite cheap. If you use this service instead, more of that refund is going to end up in your pocket either way.

TurboTax vs FreeTaxUSA: Which One Is Better?

Pros and Cons

Picking a “better” service between these two tax preparers is difficult. While TurboTax offers very comprehensive service, their fees are extremely high. While those could come out of your return, in the end, you'd still be leaving tax season with less than the maximum refund in your pocket. The audit protection that TurboTax offers is tempting, but unless you purchase an additional package costing close to $40, that protection is no more meaningful than what FreeTaxUSA provides. For the same price, why pay the extra money?

TurboTax is probably best for people who are nervous about their taxes, but who don't want to shell out for a human accountant, whose prices can mount fast if your tax situation is complicated. FreeTaxUSA assumes a certain amount of fluency – or, at least – comfort – on the part of the person filing taxes. If you know a Schedule A from a Form 1099, then there's no good reason to use TurboTax. FreeTaxUSA provides essentially the same service for a fraction of the price.








  • Very cheap
  • Simple
  • Less customer support
  • Comprehensive suite of services
  • Expensive
  • Meaningful audit protection costs extra


The Verdict

FreeTaxUSA vs TurboTax

Avoid TurboTax unless you are Warren Buffet, your taxes are truly Byzantine, or your anxiety is absolutely paralyzing. Most people will be able to complete their taxes just fine with FreeTaxUSA. All the necessary forms are there, and for $7.99, you can get a CPA's advice.

Furthermore, if you decide that you need extra assurances as you complete your taxes, you can always discard the filing midway through and switch to the shinier, more involved service. Neither FreeTaxUSA or TurboTax charges you until you reach the final stage of your transaction.

The bottom line is that FreeTaxUSA is the better deal, but TurboTax is a good backup plan. If your taxes are straightforward, the odds are good that you'll never have to use TurboTax. If you stick to the service that's really free, you could save yourself hundreds of dollars this tax season.

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