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TaxAct Deluxe 2021 review: Tax pro help for everyone

TaxAct provides more guidance than ever, including live help with a tax pro at all tiers and specialty products for businesses and the self-employed

TaxAct Deluxe review
(Image: © TaxAct)

Tom's Guide Verdict

Attractive pricing and included help from tax pros makes TaxAct a strong alternative to better-known programs, so long as you don’t need crypto guidance.

Pros

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    Clear design

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    Covers wider array of tax situations than most services

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    Tax pro help is free at all tiers

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    Introduces full service option

Cons

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    No clear cryptocurrency support or guidance

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    Different interface entry points can get confusing

TaxAct Deluxe 2021 continues to offer the most comprehensive tax filing services we’ve seen, and remains a top contender for best tax software. The big news this year is the addition of free live assistance free from tax experts at all tiers of service.
This notable update makes TaxAct a more competitive value, considering that kind of assistance costs extra elsewhere. Plus, TaxAct introduced a full service option for having a tax pro do all the work for you, akin to what TurboTax introduced last year. In spite of these strides, TaxAct remains just behind industry behemoth TurboTax, and is noticeably behind in cryptocurrency guidance. 

TaxAct delivers its services at reasonable prices, and with a flowing, easy-to-use interface. The service’s design has less hand-holding than competing products, and caters to those who know what forms they need to complete their taxes, with less guidance than competing packages. 

TaxAct Deluxe 2021 review: Cost

TaxAct covers the widest swath of specific tax-filing situations with its web- and download-based options. Many of these situations — such as support for tax-exempt organizations, trusts, and estates and business options like partnership, C-Corporation and S-Corporation — are not addressed by either TurboTax or H&R Block. (H&R Block’s Block Advisor’s product supports these business options, but only when filing with a tax pro through an in-person experience.) TaxAct markets bundles (opens in new tab) for individual and business tax filing, with up-front pricing that encompasses both situations plus the relevant state tax filing. The variety of options makes TaxAct 2021 the best do-it-yourself tax service for businesses or self-employed.

We laud TaxAct’s variety of options, but here will focus on the four core products in its online Federal portfolio. Prices scale from free to $64.95. You have to pay for state returns separately.

The primary step-ups from TaxAct's free version have always closely followed the industry standards used by TurboTax and H&R Block, but at lower prices. This year, those prices got even lower, dropping by up to $20: TaxAct Free, Deluxe ($24.95), Premier ($34.95), and TaxAct Self-Employed ($64.95). 

New for this year: TaxAct makes its Xpert Assist service (rebranded from Xpert Help) standard across all price tiers, including free. This previously extra-cost service provides live answers from CPAs and other tax experts via phone and screenshare, and its inclusion across all tiers is a big differentiator and savings for Tax Act.

If you want a tax pro do your taxes for you, TaxAct introduces this option for tax year 2021. The full service pricing is competitive with TurboTax (plus or minus, depending on TurboTax’s specials): Basic ($99.95), Deluxe ($169.95), Premier ($249.95) and Self-Employed ($279.95).

All four of the aforementioned tiers are also available for download, but these prices went up $20 year-over-year  ($39.95  plus state return, and  $119.95, $129.95, and $139.95, respectively including one state return).

TaxAct distinguishes itself by having TaxAct Estates & Trusts (Form 1041) ($109.95 online and download) for handling filing a return for an estate or trust. And it has TaxAct 2021 Tax-Exempt Organizations ($109.95 download) for those who run an organization subject to sections 501(a), 527 and 4947(a)(1).

In addition to these products, TaxAct has another four business-specific options: built around whether you have a Sole Proprietor (Form 1040C, Schedule C) ($64.95), Partnership (Form 1065) ($109.95), a C Corporation (Form 1120) or an S Corporation (Form 1120S) ($109.95). Each of these options has a downloadable version at a premium ($139.95 for the Sole Proprietor, $109.95 for the rest). TaxAct also offers business filers the chance to get bundles that include individual and business forms.

Audit defense costs an extra $44.95, and is handled through partner ProtectionPlus.

TaxAct Deluxe 2021 review: State filing

TaxAct Deluxe charges extra for state returns. State tax filing costs $39.95 per state with the free TaxAct service (a big jump in cost from last year). State filing costs $44.95 for most other products, unless you're buying one of the home and business bundles or you've downloaded TaxAct. One state e-file per form is included free in bundled scenarios.

State filing for some of the specialty packages for businesses, tax-exempt organizations, and estates and trusts costs $44.95 per state filed online; $50 for the single-state download, $100 for the all-states download.

TaxAct Deluxe 2021 review: Features

As with other tax software, the amount you spend for TaxAct will determine the features and form support you get. For example, the free product includes access to multiple tax forms, including unemployment income and retirement income (not typically offered by other free products) and will handle the stimulus payment and earned income tax credit and Child Tax Credits. But TaxAct's free version lacks basic interest income and student loan interest, both of which come with TurboTax's free product.

(Image credit: TaxAct)

As you step up through the available tiers, you will gain access to additional tax forms; this is where having the expertise to know which forms you need helps (view the comparison chart (opens in new tab)). The Deluxe version adds a litany of additional forms, including adoption credits, student loans, and Health Savings Account, plus support for Schedule A itemized real-estate taxes and mortgage deductions, and Schedule SE self-employment taxes. Premier adds support for investments, sale of home, and K-1 income, while Self-Employed is required for supporting freelance and business income.

TaxAct Deluxe 2021 review: Available help

The big news for TaxAct is that it now includes its Xpert Assist across all price tiers, including free. (TurboTax has a limited-time promo for this level of support, but only at its free tier.) You can schedule a call back (only available in some states) or talk live to CPAs and other tax experts and get your tax questions answered for free. The service also supports screensharing. Hours of operation are more limited than at TurboTax; this service is available from 8 a.m. to 8 p.m. during peak tax season.

TaxAct provides online support in the form of searchable resources on tax terms and guidance for filing your return. In addition to Xpert Assist through the service itself, TaxAct has non-toll-free phone tech support 12 hours a day on weekdays, and 9 hours on Saturdays and Sundays in the lead-up to the April 18 tax-filing deadline. 

(Image credit: TaxAct)

Throughout the web interface, you'll have options for guided data entry; pop-up info boxes to explain specific entry points; and a searchable Help Center pane with links to resources and explanations on TaxAct's website (including tax calculators, and Tax Information (opens in new tab) hub that provides checklists, law changes, and other resources). That said, guidance and information on some new initiatives, like the Child Tax Credit, is thin.

TaxAct Deluxe 2021 review: Ease of use

Getting started with TaxAct is easy: Pick a product and sign up by entering your email address, waiting for an account verification code to be sent to you, and choosing your username and password. If you are a returning customer after a large gap, the service uses both phone and email to send verification codes. TaxAct lacks the detailed on-boarding questions of competitors like TurboTax.

Once we began our 2021 tax return, we were given the option of importing info from an existing return (which we declined here) or starting from scratch with filling in basic info. The interface is largely the same as last year, with a few tweaks to accommodate better text presentation and the prominent Xpert Assist button on the top nav, and a freshened look for the help pane at right.

(Image credit: TaxAct)

We found TaxAct's unfettered interface clear and its direct language appealing. The site is responsively designed to work on mobile and desktop, with a left-hand navigation pane and a main central screen that uses fonts and graphics to make the pages compelling and easy to read. TaxAct also has a dedicated mobile app.

We could easily follow the prescribed order of topics for completing the Federal return, or choose to jump around by picking something different from the left navigation pane. Within each section, tabs along the top of the screen let you maneuver among the options for that section.

You’ll continue with entering basic information about yourself (personal information, relationship status, dependents, and residency address), and then jump into preparing the federal return. 

(Image credit: TaxAct)

This section is streamlined at the start, to get right to the meat of the matter creating your federal return. If you're unsure what something refers to or what to select, simply click on the information icon to the right of each entry. You'll get a pop-up overlay describing what the field requires.

Since Xpert Assist is free this year, TaxAct now has an annoying ad that pops up between as you move from the personal info data entry to starting the federal return. The bundle ad is offering a “deal,” but it’s jarring and hard to vet what is the real value since many of those options aren’t clear add-ons when you’re shopping for a return.

(Image credit: TaxAct)

The structure for entering federal return data is similar, with an option to choose step-by-step guidance that walks you through questions about income, investments, expenses, education expenses, and housing. TaxAct uses this info to find savings, but the company also asks for permission to share your return details with sister company TaxSmart Research LLC to get customized tax tips (you can opt out).

(Image credit: TaxAct)

Next you’ll enter your income data. Once you know what you need to enter, you have three methods to do so — an electronic import from one of the 14 supported institutions, manual entry (in a perfect digital replica of the 1099-INT form) or using guided fields to input specific data.

(Image credit: TaxAct)

We could next move through the many fields to fill out via the screen prompts, or navigate via the left navigation pane to move through the process of completing our taxes, navigating each section of the Federal form in sequence: Income, Deductions, Credits, Taxes, Miscellaneous, and then see a summary at the end. Each section was clearly presented and business-like in its approach. When we chose a form not supported by the Deluxe version we tested, TaxAct simply prompted us to upgrade.

(Image credit: TaxAct)

Ultimately, while we appreciated multiple ways of entering data, the more we moved around, the more we found the navigation got counter-intuitive (wait, how to get back to step-by-step guidance?) and extraneous (what purpose does the bookmark serve since you can’t see a list of sections bookmarked?).

TaxAct Deluxe 2021 review: Verdict

With a wide swath of online products, clean presentation, and the addition of free interactive support with live tax professionals and a less expensive full service option, TaxAct Deluxe 2021 impresses across the board — whether your tax needs are simple, or complex. If you need guidance in handling cryptocurrency transactions, you won’t find it here — for that, we recommend TurboTax. But for most needs, TaxAct offers the best mix of value and assistance among this year’s tax contenders, without going with a free product like Cash App Taxes (formerly Credit Karma Tax) or FreeTaxUSA. 

Melissa Perenson is a freelance writer. She has reviewed the best tax software for Tom's Guide for several years, and has also tested out fax software, among other things. She spent more than a decade at PC World and TechHive, and she has freelanced for numerous publications including Computer Shopper, TechRadar and Consumers Digest.