TurboTax vs. TaxAct: Which Tax Software Should You Use?

What a Simple Return Costs on Each

TurboTax and TaxAct both offer a free federal tier for a simple return, so a filer with only W-2 income and a standard deduction pays $0 in federal filing fees on either product. TurboTax's Free Edition covers only Form 1040 with a narrow set of credits: the Earned Income Tax Credit, the Child Tax Credit, student loan interest, and a handful of others.

The state return is where the two split even at the free tier. TurboTax's Free Edition includes a free state return for a qualifying simple filer, while TaxAct charges $4.95 for a state return no matter which federal tier you use, including its own free tier. A filer whose return truly qualifies as simple on both platforms pays less overall on TurboTax specifically because of that free state filing, even though TaxAct wins on price at every paid tier above it.

What a More Complex Return Costs

Add a Schedule C for freelance or gig income, itemized deductions, or investment sales, and both products move you into a paid tier. TurboTax's paid online tiers run roughly $39 to $89 for the federal return, plus $64 for each state return outside the free tier. TaxAct's comparable tiers run roughly $29.99 to $64.99 for the federal return, with state filing priced separately at $4.95 online or $9.99 per state through its desktop software.

Stack a federal return plus one state return at the top tier on each platform, and TaxAct typically comes in $20 to $40 cheaper than the matching TurboTax tier for the same tax situation. Neither company holds its published price steady all season. Both tend to raise prices as the mid-April deadline gets closer, so filing early usually costs less on either one. For a rough sense of what you'll owe before you pick a product, our how much tax will I pay guide walks through the bracket math both platforms automate for you.

What Happens If Your Return Gets Audited

TurboTax includes its Audit Support Guarantee free with every return: a trained tax professional walks you through an IRS or state notice and answers your questions about it, with two hours of collection assistance available if a covered audit results in additional tax due. TurboTax also sells paid Audit Defense, provided by TaxAudit, where a certified professional communicates with the IRS and drafts response letters on your behalf.

TaxAct's equivalent is Protection Plus, a paid add-on that covers your return for three full years and provides full-service assistance with both federal and state audits, handling correspondence with the taxing agency for you. Neither platform's free guidance replaces the paid, full-service option if you actually get audited. The free tier on both explains the notice. The paid tier handles the audit itself.

Getting Live Help From a Real Person

TurboTax Live comes in tiers of its own, from a one-time expert review of a return you prepared yourself up to a full-service option where a credentialed preparer does the entire return for you, with pricing that climbs with the complexity of your situation. TaxAct's equivalent is Xpert Assist, a single add-on priced around $60 that gives unlimited access to a credentialed, U.S.-based tax expert while you prepare your own return.

TurboTax's tiered structure fits someone who wants to choose exactly how much of the work they hand off, from a quick second opinion to letting someone else file the whole return. TaxAct's flat add-on fits someone who wants occasional expert input at one predictable price rather than a menu of service levels to compare first.

How Each Backs Its Numbers

TaxAct's headline guarantee is specific: if an error in its software produces a smaller refund or larger tax bill than the same data would produce elsewhere, TaxAct reimburses the difference up to $100,000 plus your software cost, based on its own comparison against TurboTax's paid consumer online pricing. TurboTax backs its own math with a 100% Accurate Calculations Guarantee, covering IRS or state penalties and interest caused by a calculation error in the software.

Both guarantees only cover a software error, not a mistake in the numbers you typed in or a position you took on a gray area of the tax code. Neither guarantee replaces double-checking your own entries against your actual tax documents before you file.

Where the Two Are Basically the Same

Both platforms walk you through an interview-style series of questions instead of handing you a blank IRS form, both e-file directly with the IRS and every state that supports it, and both import a prior year's return along with current-year W-2s and many investment or payroll accounts. Filing speed and the core mechanics of getting a return submitted are close enough on both that the real decision usually comes down to price and how much guidance you want along the way.

Both also cover the same range of tax situations once you're on a paid tier: rental income, investment sales, small-business income, and multi-state returns are all supported by TurboTax and TaxAct alike. Neither one forces you onto a third-party product to handle a more complicated return, so the choice rarely comes down to whether a given tax situation is supported at all.

Which One Actually Costs Less for You

Run the numbers for a freelancer with a Schedule C and a handful of itemized deductions. On TaxAct, that return typically lands in the $64.99 federal tier plus $4.95 for one state return, for a total near $70. On TurboTax, the comparable tier runs closer to $89 federal plus $64 for one state return, for a total near $153, more than double.

The gap narrows fast if you also add live help. TaxAct's Xpert Assist adds a flat $60 to that $70 total. TurboTax's live tiers price per situation and typically run well above a flat $60 add-on, so the cost gap between the two usually gets wider, not narrower, once you bring in expert help on both sides.

Who TaxAct Doesn't Fit

TaxAct doesn't fit a first-time filer who finds tax terminology genuinely confusing and wants the most hand-held experience available, since TurboTax's interview and help content are more built out at every step. It also doesn't fit someone who has already decided they want a specific TurboTax Live service tier and is only comparing price after that decision.

That calculus flips the moment cost becomes the deciding factor for a return you feel reasonably confident preparing yourself. At that point, TaxAct's lower price at nearly every paid tier, backed by the same core guarantee protection, usually outweighs TurboTax's more polished interface for a return that isn't especially complicated. Our tax tips guide covers the filing-season habits that matter more than which software you pick.

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