Freetaxusa vs Turbotax

Questions on how we spend our money and our time - consumer goods and services, home and vehicle, leisure and recreational activities
BogleTaxPro
Posts: 895
Joined: Sat Apr 04, 2020 6:08 pm

Re: Freetaxusa vs Turbotax

Post by BogleTaxPro »

bewisefinancially wrote: Fri Feb 09, 2024 10:47 am

It seems estimated payments are not captured by FTUSA. Can you please suggest:
- do I still need to pay the underpayment penalty? If yes, should I make the penalty by filing the return or wait for the IRS to calculate?
- Even after estimated payments, I still need to pay ~$7800 (I expected after estimated payment), should I pay this due amount as an estimated payment as I am planning to submit the tax return in April'2024? Any advantage to submitting an estimated tax payment now?


Did you actually enter the estimated payments in FTUSA?
From Reddit: "There's a section on the 1040 under PAYMENTS where it's entered. FreeTaxUSA will ask you about estimated payments. Just fill in the amount. You will need to indicate when the payments were made (i.e., in which quarter.)"

Yes, I entered it along with the date of payment. Can you please help with highlighted questions?
- do I still need to pay the underpayment penalty? If yes, should I make the penalty by filing the return or wait for the IRS to calculate?
Maybe. The IRS assumes that the estimated payments you made were for the income you received in that quarter. If your income was earned throughout the year but you only made estimated payments at the end of the year, you have underpaid for the prior quarters. There is a form 2210-AI that you can fill out if your income was not earned consistently to match the income to the payments. I don't know if FTUSA supports this.
You can let FTUSA calculate the penalty or let the IRS calculate it and bill you.
- Even after estimated payments, I still need to pay ~$7800 (I expected after estimated payment), should I pay this due amount as an estimated payment as I am planning to submit the tax return in April'2024? Any advantage to submitting an estimated tax payment now?
If you're not planning on filing until April, paying an extra payment now may at least stop interest from accruing. But you're missed the last estimated payment due date (january 15) so you'll still owe the penalty.
bewisefinancially
Posts: 52
Joined: Sat Dec 23, 2023 7:05 pm

Re: Freetaxusa vs Turbotax

Post by bewisefinancially »

bewisefinancially wrote: Fri Feb 09, 2024 10:47 am
BogleTaxPro wrote: Fri Feb 09, 2024 10:44 am
bewisefinancially wrote: Fri Feb 09, 2024 10:30 am I did estimated payments in Dec'2023 to match my 2023 taxes as 110% of taxes due in 2022.

But still, I see that FTUSA is showing me an underpayment penalty when I try to run that form (as I own additional amount even after estimated payment as expected).

It seems estimated payments are not captured by FTUSA. Can you please suggest:
- do I still need to pay the underpayment penalty? If yes, should I make the penalty by filing the return or wait for the IRS to calculate?
- Even after estimated payments, I still need to pay ~$7800 (I expected after estimated payment), should I pay this due amount as an estimated payment as I am planning to submit the tax return in April'2024? Any advantage to submitting an estimated tax payment now?
Did you actually enter the estimated payments in FTUSA?
From Reddit: "There's a section on the 1040 under PAYMENTS where it's entered. FreeTaxUSA will ask you about estimated payments. Just fill in the amount. You will need to indicate when the payments were made (i.e., in which quarter.)"
Yes, I entered it along with the date of payment. Can you please help with highlighted questions?
Can anyone suggest above?
prd1982
Posts: 1981
Joined: Sun Jan 08, 2017 3:43 pm

Re: Freetaxusa vs Turbotax

Post by prd1982 »

Estimated payments don’t count toward the safe harbor limits. Only withholdings count. Otherwise people could just do one estimated payment in Dec of 110% of last year’s amount owed.
anoop
Posts: 4379
Joined: Tue Mar 04, 2014 12:33 am

Re: Freetaxusa vs Turbotax

Post by anoop »

Is it possible to use Freetaxusa to prepare a return and then have them delete all the data associated with it?

I am thinking that from a security standpoint, that might make one's information less susceptible to getting hacked. I would request deletion once I have completed and saved the return and worksheets to a pdf and no longer need to use the website.
Wrench
Posts: 1235
Joined: Sun Apr 28, 2019 10:21 am

Re: Freetaxusa vs Turbotax

Post by Wrench »

prd1982 wrote: Fri Feb 09, 2024 2:28 pm Estimated payments don’t count toward the safe harbor limits. Only withholdings count. Otherwise people could just do one estimated payment in Dec of 110% of last year’s amount owed.
Not true. From IRS itself
https://www.irs.gov/businesses/small-bu ... ated-taxes
"If you didn’t pay enough tax throughout the year, either through withholding or by making estimated tax payments, you may have to pay a penalty for underpayment of estimated tax. Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller. There are special rules for farmers, fishermen, and certain higher income taxpayers. Please refer to Publication 505, Tax Withholding and Estimated Tax, for additional information". [Emphasis mine]
To prevent people doing what you suggest, they do require paying "throughout the year". So if you tried to pay 100% (or 110% for higher earners) in December, you would be penalized.

Wrench
trueson1
Posts: 398
Joined: Mon Mar 13, 2017 11:40 am

Re: Freetaxusa vs Turbotax

Post by trueson1 »

I've used TT Deluxe for many years and it works well for me and for the difference between $20 and $45, it is not worth the hassle to even considering changing.
prd1982
Posts: 1981
Joined: Sun Jan 08, 2017 3:43 pm

Re: Freetaxusa vs Turbotax

Post by prd1982 »

Wrench, notice in the sentence
Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller
That estimated taxes is not specified. Only withholding is mentioned. I'm guessing 10+% of the folks on this forum would make 1 estimated payment in Dec for all their taxes.

Let's see what others say.
ehh
Posts: 1004
Joined: Mon Feb 01, 2021 10:04 am

Re: Freetaxusa vs Turbotax

Post by ehh »

anoop wrote: Fri Feb 09, 2024 2:59 pm Is it possible to use Freetaxusa to prepare a return and then have them delete all the data associated with it?

I am thinking that from a security standpoint, that might make one's information less susceptible to getting hacked. I would request deletion once I have completed and saved the return and worksheets to a pdf and no longer need to use the website.
I don't know.

FreeTaxUSA makes use of last year's data to help you with this year's return. For example, displaying last year's amounts so you can compare to this year and remind you of anything you might be overlooking, form 8606, various other carry forwards, and determining whether state tax rebates are taxable federal income this year. For me, this is a handy feature.

FreeTaxUSA is online only. I suspect there is nothing you can do to prevent your return from persisting on a FreeTaxUSA server.

Perhaps I am naive, but I don't worry about my data being exposed via a FreeTaxUSA hack.

If you are worried about information from your electronically prepared tax return being exposed, I suspect your only option is paper and to trust the ancient IRS mainframes.
eukonomos
Posts: 297
Joined: Mon Jan 01, 2018 1:26 pm

Re: Freetaxusa vs Turbotax

Post by eukonomos »

prd1982 wrote: Fri Feb 09, 2024 3:45 pm Wrench, notice in the sentence
Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller
That estimated taxes is not specified. Only withholding is mentioned. I'm guessing 10+% of the folks on this forum would make 1 estimated payment in Dec for all their taxes.

Let's see what others say.
The $1,000 safe harbor is only for withholdings (and credits).
The 90% and 100% safe harbors are for withholding plus timely estimated payments.

I have no guess about how many make just one estimated payment, but the point is to make estimated payments as needed.
anoop
Posts: 4379
Joined: Tue Mar 04, 2014 12:33 am

Re: Freetaxusa vs Turbotax

Post by anoop »

ehh wrote: Fri Feb 09, 2024 3:49 pm
anoop wrote: Fri Feb 09, 2024 2:59 pm Is it possible to use Freetaxusa to prepare a return and then have them delete all the data associated with it?

I am thinking that from a security standpoint, that might make one's information less susceptible to getting hacked. I would request deletion once I have completed and saved the return and worksheets to a pdf and no longer need to use the website.
I don't know.

FreeTaxUSA makes use of last year's data to help you with this year's return. For example, displaying last year's amounts so you can compare to this year and remind you of anything you might be overlooking, form 8606, various other carry forwards, and determining whether state tax rebates are taxable federal income this year. For me, this is a handy feature.

FreeTaxUSA is online only. I suspect there is nothing you can do to prevent your return from persisting on a FreeTaxUSA server.

Perhaps I am naive, but I don't worry about my data being exposed via a FreeTaxUSA hack.

If you are worried about information from your electronically prepared tax return being exposed, I suspect your only option is paper and to trust the ancient IRS mainframes.
They allow for a pdf import of prior years tax regardless of how it was prepared, so storing of tax returns is not needed for that.
ehh
Posts: 1004
Joined: Mon Feb 01, 2021 10:04 am

Re: Freetaxusa vs Turbotax

Post by ehh »

prd1982 wrote: Fri Feb 09, 2024 3:45 pm Wrench, notice in the sentence
Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller
That estimated taxes is not specified. Only withholding is mentioned. I'm guessing 10+% of the folks on this forum would make 1 estimated payment in Dec for all their taxes.

Let's see what others say.
I gotta vote with Wrench on this one.

As long as the estimated payments satisfy a safe harbor and are early or on-time and equal, you are good.

For example, I pay all my federal tax via estimated tax payment. I make one estimated payment in early April equal to or a bit greater than 100% (I am, for a Boglehead, low income :( ) of my prior years tax obligation. Have done this for years. Nary a peep from my friends at the IRS.
eukonomos
Posts: 297
Joined: Mon Jan 01, 2018 1:26 pm

Re: Freetaxusa vs Turbotax

Post by eukonomos »

ehh wrote: Fri Feb 09, 2024 3:49 pm
anoop wrote: Fri Feb 09, 2024 2:59 pm Is it possible to use Freetaxusa to prepare a return and then have them delete all the data associated with it?

I am thinking that from a security standpoint, that might make one's information less susceptible to getting hacked. I would request deletion once I have completed and saved the return and worksheets to a pdf and no longer need to use the website.
I don't know.

FreeTaxUSA makes use of last year's data to help you with this year's return. For example, displaying last year's amounts so you can compare to this year and remind you of anything you might be overlooking, form 8606, various other carry forwards, and determining whether state tax rebates are taxable federal income this year. For me, this is a handy feature.

FreeTaxUSA is online only. I suspect there is nothing you can do to prevent your return from persisting on a FreeTaxUSA server.

Perhaps I am naive, but I don't worry about my data being exposed via a FreeTaxUSA hack.

If you are worried about information from your electronically prepared tax return being exposed, I suspect your only option is paper and to trust the ancient IRS mainframes.
Or Use FreeTaxUSA with dummy name and SSN, then transfer the info to Free File Fillable Forms to efile to the IRS. They automatically delete everything in October.
The FTU info would still be there next year.
anoop
Posts: 4379
Joined: Tue Mar 04, 2014 12:33 am

Re: Freetaxusa vs Turbotax

Post by anoop »

trueson1 wrote: Fri Feb 09, 2024 3:16 pm I've used TT Deluxe for many years and it works well for me and for the difference between $20 and $45, it is not worth the hassle to even considering changing.
Well for years I had trouble accessing my account at Intuit. I was somehow able to get in a few weeks ago. But now that I have downloaded it, I can't seem to be able to activate it. I am now in a state where I fire up the app only to have it hang at activation with 4 blue dots going round and round in a circle forever. That's when I came back to this thread...
prd1982
Posts: 1981
Joined: Sun Jan 08, 2017 3:43 pm

Re: Freetaxusa vs Turbotax

Post by prd1982 »

As long as the estimated payments satisfy a safe harbor and are early or on-time and equal, you are good.
I agree
Note that the original post was about making a single estimated payment in Dec. Once you get past the first quarter for estimated payments, it is too late to use estimated payments to make the safe harbor rules.At least that is what i think. That's why i take my RMD in Dec & ensure the withholding gets me to the safe harbor amount.
ehh
Posts: 1004
Joined: Mon Feb 01, 2021 10:04 am

Re: Freetaxusa vs Turbotax

Post by ehh »

eukonomos wrote: Fri Feb 09, 2024 4:00 pm Or Use FreeTaxUSA with dummy name and SSN, then transfer the info to Free File Fillable Forms to efile to the IRS. They automatically delete everything in October.
The FTU info would still be there next year.
To me seems like extra work to guard against a very low probability event.

Of course, FreeTaxUSA does not detail their security procedures. This page https://www.freetaxusa.com/safe gives a few generalities. All data is encrypted - both in transit and at rest. " Our physical servers are owned by us and located in a secure data center. These servers are monitored 24 hours a day, 365 days a year, and are under strict access control."

They have been around since 2001. While nothing is perfectly secure, and perhaps I am naive, I don't worry about a hacker raid on FreeTaxUSA - ala the Equifax disaster.
Wrench
Posts: 1235
Joined: Sun Apr 28, 2019 10:21 am

Re: Freetaxusa vs Turbotax

Post by Wrench »

prd1982 wrote: Fri Feb 09, 2024 3:45 pm Wrench, notice in the sentence
Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller
That estimated taxes is not specified. Only withholding is mentioned. I'm guessing 10+% of the folks on this forum would make 1 estimated payment in Dec for all their taxes.

Let's see what others say.
Note - "withholdings and credits", the latter includes estimated taxes. I know this is correct because my MIL's accountant determines her estimated taxes every year based on safe harbor limits. She has done this for many years. MIL pays estimated taxes quarterly to meet safe harbor. She has never been penalized.

Wrench
mouth
Posts: 908
Joined: Sun Apr 19, 2015 6:40 am

Re: Freetaxusa vs Turbotax

Post by mouth »

cacophony wrote: Tue Dec 05, 2023 2:03 am
anoop wrote: Tue Dec 05, 2023 12:59 am I saw a review comparing these two on YouTube in which the reviewer says if you want to jump around and complete the return in parts (i.e. not a linear start to finish in one sitting), then freetaxusa doesn’t work well and TurboTax would be preferred. Is this an accurate assessment?
That doesn't sound accurate to me. I jumped around quite a bit and found the FreeTaxUSA interface far easier to navigate than TurboTax or H&R Block. And of course you don't have to do it all in one sitting. Whatever you fill in is remembered for the next time you come back.
Doubling down on this. I would say that review is a flat out lie, but I didn't watch it myself. I jump around FreeTaxUSA all the time. In fact I specifically do NOT follow their linear path anymore because I know it so well, and I add my details as they arrive which means jumping right to where I need each time a new form arrives.

It's incredibly conducive to exactly that and unlike my memories of TurboTax, I can see actual IRS forms, populated with my data BEFORE I pay.
mouth
Posts: 908
Joined: Sun Apr 19, 2015 6:40 am

Re: Freetaxusa vs Turbotax

Post by mouth »

Tdubs wrote: Sun Jan 07, 2024 4:09 pm
Walkure wrote: Fri Jan 05, 2024 3:42 pm
Tdubs wrote: Thu Dec 29, 2022 2:28 pm
Drew31 wrote: Wed Dec 28, 2022 12:42 pm I used Freetaxusa for several years and liked it. Switched away in order to get I Bonds via tax refund but would use again.

Doesn't Freetaxusa still require payment for state e-file? I thought that was more of a state thing then the platforms themselves. Maybe I'm just confused. I never used it for state as I have just done them by hand with PDFs from the state.
Because of its inability to handle paper I Bond purchases, I switched to OLT.
In case this is a dealbreaker for anyone, I will report that I used Freetaxusa for 2022 and was able request I-bonds for my refund. However, I was using the $7.99 deluxe tier for the unlimited amendments, not sure if that makes a difference. (I had used free file fillable forms previously, but one year of having to amend by paper was enough for me to say never again!)
It wasn't an option at all when I bailed on freetax, though an agent said they were considering doing it in the future. Good to know they followed through.
I've already filed for 2023 using FreeTaxUSA basic, non-delux, and it asked me if I'd like to use my refund to buy iBonds. I considered it but decided against it.
TheHiker
Posts: 551
Joined: Fri Feb 05, 2021 8:34 pm

Re: Freetaxusa vs Turbotax

Post by TheHiker »

I have been using free fillable forms for a number of years without any issues. They support all the forms I ever needed.
I don't know if I trust my personal info to them more than to the other options though.
This product does not come direct from the IRS, but from a third party (the name buried in the terms of service on their website is On-Line Taxes, Inc).
eukonomos
Posts: 297
Joined: Mon Jan 01, 2018 1:26 pm

Re: Freetaxusa vs Turbotax

Post by eukonomos »

Wrench wrote: Fri Feb 09, 2024 4:27 pm ...
Note - "withholdings and credits", the latter includes estimated taxes.
...
I don't believe this is true. Credits are credits (Educational credits, Foreign Tax credit, Retirement Savings credit, etc., etc.)

Estimated tax payments are not used to meet the $1,000 safe harbor.
They apply to the 90% and 100(110)% safe harbors.
User avatar
Regal 56
Posts: 597
Joined: Thu May 24, 2007 5:47 pm
Location: South Euclid, OH
Contact:

Re: Freetaxusa vs Turbotax

Post by Regal 56 »

This year I used FreeTaxUSA for the first time. As tax software goes, I found it reasonably easy to use. My tax return is slightly more complex than a standard 1040EZ. Some of my income is self-employed, and I also collect book royalties. That makes finding free tax prep software harder to find. But I was able to breeze through with FreeTaxUSA. Both Federal and State returns were free. (Often not the case with “free” tax prep software.)

If TurboTax were free for me, I’d use it. Of all the tax prep software I’ve used, it was the easiest. FreeTaxUSA, however, got the job done with little hassle. So if it’s still around next year, I’ll use it again.
986racer
Posts: 759
Joined: Thu Aug 11, 2016 10:09 am

Re: Freetaxusa vs Turbotax

Post by 986racer »

Last year I tried out freetaxusa and used it as a check against Turbotax. The nice thing was that it caught times when I wasn't entering in info in Turbotax correctly and therefore not getting the full credit. E.g, I didn't properly enter in the backdoor Roth info into turbotax and I found the discrepancy using freetaxusa

One things freetaxusa doesn't do is properly handle this: Back Door AOTC. As a result, I have to keep using TT until the kids are done with college.
User avatar
PinotGris
Posts: 1284
Joined: Tue Feb 14, 2012 8:38 pm

Re: Freetaxusa vs Turbotax

Post by PinotGris »

I know it is way too early. I am a long time TurboTax user and had a lot of problems with it last year, some forms totally missing.
I have been reading the comments on freetaxusa and would like to try it this year. I have a few questions for those of you who have used it for a few years.
How would i import all my last year data? Like carryover capital loss?
How is state tax filed? Is it a separate process? I like how the State tax gets done simultaneously and both are filed.
Anybody used the Pro support? What is your experience?
Thank you.
Blake7
Posts: 411
Joined: Fri Mar 30, 2018 2:52 pm
Location: USA

Re: Freetaxusa vs Turbotax

Post by Blake7 »

PinotGris wrote: Thu Oct 24, 2024 7:02 pm I know it is way too early. I am a long time TurboTax user and had a lot of problems with it last year, some forms totally missing.
I have been reading the comments on freetaxusa and would like to try it this year. I have a few questions for those of you who have used it for a few years.
How would i import all my last year data? Like carryover capital loss?
How is state tax filed? Is it a separate process? I like how the State tax gets done simultaneously and both are filed.
Anybody used the Pro support? What is your experience?
Thank you.
This coming tax season will be my third year using FTUSA, and I highly recommend it. I can’t speak to importing (it will import W2s per the website), and I’ve not used the Pro support. Ref. the state tax, once you’ve completed the fed return it will transfer over the necessary data to the state return if you pay the $15 for it. It’s all sequential and via tabs and it’s very intuitive, with decent help as you go for most situations. Fed and state E-filing is included too. I’m never going back to the BS nagging, upsells, gotchas of the three over-priced major providers that I’ve used in the past. HTH
User avatar
telemark
Posts: 3576
Joined: Sat Aug 11, 2012 6:35 am

Re: Freetaxusa vs Turbotax

Post by telemark »

If you have PDFs of your previous tax returns, Freetaxusa can scan those. It will not import this year's information from places like Vanguard the way that Turbotax does: you have to enter that by hand. Freetaxusa can file your state taxes, and they're rather insistent about offering this to you, but that's the part that costs money. Last year it was $14.99, might be higher this year. You can also choose to file those some other way.
nalor511
Posts: 6028
Joined: Mon Jul 27, 2015 1:00 am

Re: Freetaxusa vs Turbotax

Post by nalor511 »

PinotGris wrote: Thu Oct 24, 2024 7:02 pm I know it is way too early. I am a long time TurboTax user and had a lot of problems with it last year, some forms totally missing.
I have been reading the comments on freetaxusa and would like to try it this year. I have a few questions for those of you who have used it for a few years.
How would i import all my last year data? Like carryover capital loss?
How is state tax filed? Is it a separate process? I like how the State tax gets done simultaneously and both are filed.
Anybody used the Pro support? What is your experience?
Thank you.
I like OLT.com over FTUSA because it's $5 cheaper and doesn't charge extra if you need to amend (FTUSA charges more), and OLT will also let you amend returns they didn't originally file (for $14). I also found OLT more flexible and easier to preview my pdf. FTUSA has an easier, simpler UI/flow
User avatar
USAFperio
Posts: 132
Joined: Sun Nov 11, 2018 11:37 pm
Location: San Antonio

Re: Freetaxusa vs Turbotax

Post by USAFperio »

torso2500 wrote: Sat Jan 06, 2024 12:09 pm
tetractys wrote: Sat Jan 06, 2024 10:42 am Interesting, I see the “We”; but could you source that?
https://www.freetaxusa.com/software
scroll down, click "see everything we support", scroll down, click "Items not Supported"

edit to add: there is also a link at the bottom of the homepage under "Current Year" called "Supported Federal Forms"
I just noticed they removed the line about not supporting donation of high value property/items.
Air Force colonel, retiring in 2026 after 23 years on active duty
User avatar
USAFperio
Posts: 132
Joined: Sun Nov 11, 2018 11:37 pm
Location: San Antonio

Re: Freetaxusa vs Turbotax

Post by USAFperio »

prd1982 wrote: Fri Feb 09, 2024 4:23 pm
As long as the estimated payments satisfy a safe harbor and are early or on-time and equal, you are good.
I agree
Note that the original post was about making a single estimated payment in Dec. Once you get past the first quarter for estimated payments, it is too late to use estimated payments to make the safe harbor rules.At least that is what i think. That's why i take my RMD in Dec & ensure the withholding gets me to the safe harbor amount.
Just so I understand, you don't make any estimated tax payments throughout the year, and then in December right before year's end, you withdraw your RMD with enough withholding to meet safe harbor requirements? I ask because I'll be retiring next year myself and needing to do all this for the first time.
Air Force colonel, retiring in 2026 after 23 years on active duty
User avatar
USAFperio
Posts: 132
Joined: Sun Nov 11, 2018 11:37 pm
Location: San Antonio

Re: Freetaxusa vs Turbotax

Post by USAFperio »

After 26 years of using TurboTax (I began in 1998), I finally used FreeTaxUSA for the first time last night. I was elated and surprised at how easy and smooth it was. I was dreading having to learn a new system, but it was so easy and felt very natural--similar to TurboTax but less bloated and annoying. It flowed far more easily and I knocked it out in about 90 minutes. And for free!

My return included: capital loss carryovers, backdoor Roth IRAs (conversions), donation of appreciated shares to a DAF, and child tax credits.

The only annoying part was that FreeTaxUSA didn't have a way to estimate my sales taxes like TurboTax has. If there's an easy way to do that that others have figured out, I'd love to know. The IRS's Sales Tax Deduction Calculator doesn't even seem to be "open" yet for tax year 2024: https://apps.irs.gov/app/stdc/
Air Force colonel, retiring in 2026 after 23 years on active duty
Circe
Posts: 465
Joined: Thu Apr 21, 2022 7:16 pm

Re: Freetaxusa vs Turbotax

Post by Circe »

I've used OLT for years now and have been very pleased with it. I did a relative's final return also and it was easy to use. Prior to that, I've used TurboTax and H&R Block; they've all been good. Last year, I got the free Fidelity TurboTax and did it to see how it compared; I filed the OLT return and decided that I would stay with that unless something changed. So when I didn't get the freebie this year, I wasn't upset. I'm still missing a 1099 so haven't started the process as yet.
GoldStar
Posts: 1281
Joined: Wed May 23, 2018 10:59 am

Re: Freetaxusa vs Turbotax

Post by GoldStar »

mouth wrote: Fri Feb 09, 2024 4:40 pm
It's incredibly conducive to exactly that and unlike my memories of TurboTax, I can see actual IRS forms, populated with my data BEFORE I pay.
You can look at Forms in TurboTax any time you like. You just switch between Easy-mode and Forms mode anytime you want to see what has been filled out so far. This has been true for many many years.
syngameon
Posts: 94
Joined: Sun Jan 21, 2024 5:35 pm

Re: Freetaxusa vs Turbotax

Post by syngameon »

CletusCaddy wrote: Thu Jan 26, 2023 2:54 pm Freetaxusa offers PDF upload of W2s for the first time this year. Gives me hope that 1099s are not far behind
A word of caution. The PDF reader isn't accurate. I found several omissions and typos when importing my W2. Double check everything.
syngameon
Posts: 94
Joined: Sun Jan 21, 2024 5:35 pm

Re: Freetaxusa vs Turbotax

Post by syngameon »

I am a new convert to FTUSA. Filed with taxact for the last 10 or so years. This year I have a 0.95 reportable in 1099-Q and they want $49 to include that functionality. Well, they can pound sand now.
mouth
Posts: 908
Joined: Sun Apr 19, 2015 6:40 am

Re: Freetaxusa vs Turbotax

Post by mouth »

GoldStar wrote: Thu Jan 30, 2025 11:38 am
mouth wrote: Fri Feb 09, 2024 4:40 pm
It's incredibly conducive to exactly that and unlike my memories of TurboTax, I can see actual IRS forms, populated with my data BEFORE I pay.
You can look at Forms in TurboTax any time you like. You just switch between Easy-mode and Forms mode anytime you want to see what has been filled out so far. This has been true for many many years.
Before or after you've paid? With FTUSA you can see the federal forms without paying.

Also in my defense I haven't used TT in at least 15 years. I think I switched to TaxACT for a year or two before going to FTUSA.
GoldStar
Posts: 1281
Joined: Wed May 23, 2018 10:59 am

Re: Freetaxusa vs Turbotax

Post by GoldStar »

mouth wrote: Thu Jan 30, 2025 1:37 pm
GoldStar wrote: Thu Jan 30, 2025 11:38 am

You can look at Forms in TurboTax any time you like. You just switch between Easy-mode and Forms mode anytime you want to see what has been filled out so far. This has been true for many many years.
Before or after you've paid? With FTUSA you can see the federal forms without paying.

Also in my defense I haven't used TT in at least 15 years. I think I switched to TaxACT for a year or two before going to FTUSA.
Sorry - I missed the "before you pay" part. I thought I read "before I file".
I always pay for TT download product so always prepay. I spot check Forms as I am filling out my taxes before I get to the end and file.
User avatar
beyou
Posts: 7928
Joined: Sat Feb 27, 2010 2:57 pm
Location: If you can make it there

Re: Freetaxusa vs Turbotax

Post by beyou »

GoldStar wrote: Thu Jan 30, 2025 11:38 am
mouth wrote: Fri Feb 09, 2024 4:40 pm
It's incredibly conducive to exactly that and unlike my memories of TurboTax, I can see actual IRS forms, populated with my data BEFORE I pay.
You can look at Forms in TurboTax any time you like. You just switch between Easy-mode and Forms mode anytime you want to see what has been filled out so far. This has been true for many many years.
Online in the downloaded desktop version.
The online version does not have the Forms mode.
I switched to online then back to desktop for this reason, though I hardly use the forms mode. But useful when you do need it.
renner
Posts: 33
Joined: Sat Jan 20, 2018 1:25 pm

Re: Freetaxusa vs Turbotax

Post by renner »

I used Cash App Taxes, formerly known as Credit Karma Taxes, for the past three years. The numbers seem accurate (compared against TT). They offer free federal and state e-filing. The downside that if you need to amend your tax, you would have to print and mail your tax forms to the IRS.
Gadget
Posts: 1119
Joined: Fri Mar 17, 2017 1:38 pm

Re: Freetaxusa vs Turbotax

Post by Gadget »

renner wrote: Fri Jan 31, 2025 2:42 pm I used Cash App Taxes, formerly known as Credit Karma Taxes, for the past three years. The numbers seem accurate (compared against TT). They offer free federal and state e-filing. The downside that if you need to amend your tax, you would have to print and mail your tax forms to the IRS.
Cash app taxes doesn't support underpayment penalty calculations (Form 2210), foreign tax credits (Form 1116), or any K-1s. There's a lot of other rarer exclusions, but these are the major ones that I think a lot of people on this forum would encounter. Wouldn't want anyone to waste their time entering a lot of data before realizing that. I haven't seen this many exclusions on most of the other options.
renner
Posts: 33
Joined: Sat Jan 20, 2018 1:25 pm

Re: Freetaxusa vs Turbotax

Post by renner »

Gadget wrote: Fri Jan 31, 2025 4:22 pm
renner wrote: Fri Jan 31, 2025 2:42 pm I used Cash App Taxes, formerly known as Credit Karma Taxes, for the past three years. The numbers seem accurate (compared against TT). They offer free federal and state e-filing. The downside that if you need to amend your tax, you would have to print and mail your tax forms to the IRS.
Cash app taxes doesn't support underpayment penalty calculations (Form 2210), foreign tax credits (Form 1116), or any K-1s. There's a lot of other rarer exclusions, but these are the major ones that I think a lot of people on this forum would encounter. Wouldn't want anyone to waste their time entering a lot of data before realizing that. I haven't seen this many exclusions on most of the other options.
Thank you for pointing out their lacking support these forms. I have fairly simple tax (just W2's, backdoor Roth, 1099's) so it works fine for now. I plan to try FreeTaxUSA if I have ever need to file those forms.
User avatar
telemark
Posts: 3576
Joined: Sat Aug 11, 2012 6:35 am

Re: Freetaxusa vs Turbotax

Post by telemark »

mouth wrote: Thu Jan 30, 2025 1:37 pm Also in my defense I haven't used TT in at least 15 years. I think I switched to TaxACT for a year or two before going to FTUSA.
I switched to TaxACT when TurboTax started requiring a version of OS X that my older Mac couldn't run (and I didn't want to buy a new Mac just to do my taxes). After a few years TaxACT suddenly raised their prices dramatically and I switched to FreeTaxUSA. Been using it ever since.
vshun
Posts: 243
Joined: Fri Feb 06, 2009 9:48 am

Re: Freetaxusa vs Turbotax

Post by vshun »

syngameon wrote: Thu Jan 30, 2025 1:01 pm
CletusCaddy wrote: Thu Jan 26, 2023 2:54 pm Freetaxusa offers PDF upload of W2s for the first time this year. Gives me hope that 1099s are not far behind
A word of caution. The PDF reader isn't accurate. I found several omissions and typos when importing my W2. Double check everything.
Yes, for me last year it messed up state return by confusing social security withholdings with state tax. Being state return I did not notice and got a letter from state authorities about the discrepancy.
This year I double checked all entries and they appeared to be correct so maybe they improved or maybe this is random.
To the topic at hand, I got free TurboTax via Fidelity and asked on Reddit whether I should use it or stick with FreeTax, and overwhelming majority said FreeTAX, so I am sticking with it even if it costs me a handful of dineros vs supposedly free Turbotax.
Wrench
Posts: 1235
Joined: Sun Apr 28, 2019 10:21 am

Re: Freetaxusa vs Turbotax

Post by Wrench »

FreeTaxusa is a hard no for me. I opened a Solo401K in 2024 and qualify for an auto enrollment tax credit of $500. FreeTaxusa does not have the proper code in Box 13 on K1 (AF) to give the credit. Also, I'm not sure it handles QBI properly for me, though I did not dig deeply after realizing the other issue. Will stick with TurboTax that does handle both properly. It looks like it would be fine for simple returns, but anything more complex, it seems like you really have to know what you're doing to make sure it is correct.

Wrench
Gadget
Posts: 1119
Joined: Fri Mar 17, 2017 1:38 pm

Re: Freetaxusa vs Turbotax

Post by Gadget »

Wrench wrote: Sun Feb 02, 2025 5:44 pm FreeTaxusa is a hard no for me. I opened a Solo401K in 2024 and qualify for an auto enrollment tax credit of $500. FreeTaxusa does not have the proper code in Box 13 on K1 (AF) to give the credit. Also, I'm not sure it handles QBI properly for me, though I did not dig deeply after realizing the other issue. Will stick with TurboTax that does handle both properly. It looks like it would be fine for simple returns, but anything more complex, it seems like you really have to know what you're doing to make sure it is correct.

Wrench
Are you sure you actually have a solo 401k that qualifies for this credit? I was pretty sure only like a couple places had all the paperwork in place for this. If you just have a solo 401k at Fidelity or some place like that, I don't think you can get the credit right?
Wrench
Posts: 1235
Joined: Sun Apr 28, 2019 10:21 am

Re: Freetaxusa vs Turbotax

Post by Wrench »

Gadget wrote: Mon Feb 03, 2025 9:40 am
Wrench wrote: Sun Feb 02, 2025 5:44 pm FreeTaxusa is a hard no for me. I opened a Solo401K in 2024 and qualify for an auto enrollment tax credit of $500. FreeTaxusa does not have the proper code in Box 13 on K1 (AF) to give the credit. Also, I'm not sure it handles QBI properly for me, though I did not dig deeply after realizing the other issue. Will stick with TurboTax that does handle both properly. It looks like it would be fine for simple returns, but anything more complex, it seems like you really have to know what you're doing to make sure it is correct.

Wrench
Are you sure you actually have a solo 401k that qualifies for this credit? I was pretty sure only like a couple places had all the paperwork in place for this. If you just have a solo 401k at Fidelity or some place like that, I don't think you can get the credit right?
Yep. Positive. Set up through mysolo401K, and the documents specifically state auto enrollment option (as do all the web pages at mysolo401K). You are correct I believe - the "standard" solo 401Ks at the brokerages do not include this feature. Can't quite figure out why Fretaxusa doesn't have this code - they have pretty much all the others, just not AF. Oh well, maybe next year...

Wrench
Chuckles960
Posts: 1053
Joined: Thu May 13, 2021 12:09 pm

Re: Freetaxusa vs Turbotax

Post by Chuckles960 »

TurboTax and TaxAct support downloading of 1099s from major brokerages. That, or (equivalently) accurately reading uploaded 1099 PDFs(*), is worth some money to me. If I understand correctly, FreetaxUSA doesn't do either. (Yes, I know it isn't a huge amount of data entry, but still.)

I'm using TA this year because TT doesn't do form 8621. While TA did download most of the 1099 data, I had to add the Sec 199A dividends manually. I don't recall if TT had the same issue, i.e. I am not sure if it is a Fidelity problem. Both have the problem that all joint account data gets downloaded twice, once for each of us, and one copy must be manually deleted(*).


(*)Shouldn't AI be able to help do these things?
lereh
Posts: 114
Joined: Fri Apr 24, 2015 4:24 pm

Re: Freetaxusa vs Turbotax

Post by lereh »

FYI: Turbotax keeps freezing right before the review section, and then my PC bombed to blue screen. I suspect TT as I do nothing else on that machine.

I do multiple returns for family. Do freetaxusa etc have limits on how many returns using same email/phone?

What other products have a high bug rate? I don’t want to waste another whole day trying to get software to populate forms I already have done by hand. lol
Topic Author
BogleMelon
Posts: 3277
Joined: Mon Feb 01, 2016 10:49 am

Re: Freetaxusa vs Turbotax

Post by BogleMelon »

lereh wrote: Sun Feb 09, 2025 8:15 am FYI: Turbotax keeps freezing right before the review section, and then my PC bombed to blue screen. I suspect TT as I do nothing else on that machine.

I do multiple returns for family. Do freetaxusa etc have limits on how many returns using same email/phone?

What other products have a high bug rate? I don’t want to waste another whole day trying to get software to populate forms I already have done by hand. lol
freetaxusa allows only one tax filing per account.
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather
lereh
Posts: 114
Joined: Fri Apr 24, 2015 4:24 pm

Re: Freetaxusa vs Turbotax

Post by lereh »

That’s OK I will just set up separate accounts for each return using each taxpayers icontact info. Probably should be doing that anyway.

Is anyone else having these problems with this freezing TurboTax? 20 years plus and I never had a problem.
lereh
Posts: 114
Joined: Fri Apr 24, 2015 4:24 pm

Re: Freetaxusa vs Turbotax

Post by lereh »

I need to be able to have forms view which other products support or do not support that
Topic Author
BogleMelon
Posts: 3277
Joined: Mon Feb 01, 2016 10:49 am

Re: Freetaxusa vs Turbotax

Post by BogleMelon »

lereh wrote: Sun Feb 09, 2025 8:44 am I need to be able to have forms view which other products support or do not support that
Go to summary tab, you will see all the federal forms there. State forms are only available after buying the state
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather
Post Reply