I have a question from a reader of AskDong.

i’m doing my own taxes this year for the first time in my life. what is the best software to help me? i would like to download turbotax, but want to get the right one. my taxes should be very simple. i have one salaried job, and a few bank accounts earning interest. will the free version of turbotax be enough, or should i get deluxe?

thanks!

-R

Intuit in effort to increase sales and extract extra margins had 4 different versions of TurboTax, and the online cost vs purchasing a physical copy of the software.  The physical versions are more expensive but allow those who are concerned with privacy to hold their own data, and also allow the completion of different returns. Using TurboTax online is cheaper than buying the actual turbotax software for the computer, but limits you to filing only one return.  For a family that might have many different taxes to file, the online solution might not make sense.  Intuit still charges for each electronic filing, so it still profits from each additional tax filing unless of course you decide the mail the filing.

Free - $0/Not Available. The free version of Turbotax is only available online.
Basic - $14.95/$19.95
Deluxe - $29.95/$44.95
Premiere - $49.95/$74.95
Home & Business - $74.95/$89.95

This year I got premiere, but in years past I’ve stuck with Deluxe. I know from experience now that Deluxe doesn’t differ much from Premiere. Premiere does handle rental properties, investments, and business income slightly better than Deluxe.  However for most individuals especially those who don’t have rental or business income,  Deluxe is more than adequate.

The real question is when is standard enough? Since I’ve never used either the Free or Basic version before, I decided to give them a quick run though online. There’s hardly any difference between the Free and Basic version. The Basic version has a slightly more interactive interface, and guides the user better with questions.  In terms of content I believe they are identical. I would say if you’ve used the 1040EZ in the past, and/or rent instead of owning then the free version of TurboTax is probably enough. I don’t see much of point in ponying an extra $15 for the basic version.  The big addition to the Deluxe version of TurboTax is that it handles mortgage interest deductions.