H&R Block At Home beats TurboTax Online

I decided to do my taxes on Sunday. I thought it would take two hours because even though I have a schedule C and some 1099-Divs, TurboTax has always made it fairly easy in the past.

This year, I tried TurboTax online rather than downloading the software. You set up an account, do your return online, and pay when you’re satisfied with the results – which I was not.

NOTE: All costs cited here will be cheaper if you don’t file a Schedule C. There are several options with both companies. I’ve included these prices just for an apples-to-apples comparison.

TurboTax – FAIL

As usual, TurboTax guided me step by step through everything, and I do mean everything, including the question of whether I have some horses and farm equipment. It seemed there were more than the usual number of questions that left me going “huh?” I had no idea what some of it meant, and the help links – when there were any – weren’t that helpful. But I finished. TurboTax does import more tax forms from various companies (your employer, your stock broker, etc.) than H. & R. Block, but I think this system has significant bugs.

And then the error check, which you cannot skip, even when you know your return is right and Turbo Tax is on drugs. It said I needed to fill out an IRS form reporting my stock sales for 2009. I hadn’t bought or sold any stocks in 2009. I called TD Ameritrade, my broker, to make sure that earning dividends did not, in some IRS way of looking at life, constitute stock sales. They looked at my account and assured me I didn’t need to fill out that form. I deleted that 1099-Div, which I had automatically imported from Ameritrade, and re-entered everything manually. No help – it still wanted me to report non-existent stock sales.

I went back to TurboTax to see how to contact a friendly customer service rep who could assist me with this technical glitch in their program. My choices turned out to be:

• Free: submit my question to a sort of forum where anyone can answer. I did. It’s now Tuesday, and no one has answered. I found a lot of similar questions that suggest the importing function has glitches. None of the answers to these questions helped me.
• Free: chat to a robot which misinterpreted the key words in my question and offered irrelevant solutions. This thing is beyond useless unless your question is incredibly basic.
• Do some sort of chat or call thing, where you allegedly have the option to do either, but when you click “call”, it takes you to an email form. I didn’t try this because if the paid solution (next solution) had a more-than-two-hour response lag, how long would the email form take?
• Call an tax expert – it’s only $29.99 for the first twenty minutes and you get your answer in “more than two hours”! Except it was “temporarily closed” due to high call volume, anyway And I didn’t need a tax expert – I needed a someone in tech support.

$29.99? I was already paying $75 – and that’s without getting my state taxes e-filed (an additional $37). I decided to try a competitor.

H. & R. Block rocks

This service only cost me $79, altogether – and that included my state e-file and a session with a tax professional (which I didn’t end up needing). The dollar value was already better, but what about the rest?

H. & R. Block has a really nice interface that allows you to select all the tax questions that could possibly be relevant to you while skipping over the ones that clearly aren’t. The help links clarified everything to the point where I was sure I was giving the correct answers. When it came to deductions versus depreciations, something I really don’t understand, it not only advised me which was which, but also chose the best form of depreciation for me and explained its logic so I could make a different choice if I knew better than the computer.

The error check gives you an option to skip it and file without fixing the errors – again, allowing for the possibility you’re smarter than the program. But it didn’t dream up any imaginary stock sales or anything. It did find a couple of problems in my depreciations, which I couldn’t make sense of from reading what it said. But when I went to the appropriate area, I realized I just hadn’t checked anything on a couple of screens somehow, and once I did, it came up error-free.

And it came up with a slightly higher Federal refund than TurboTax and the same amount owed to California. (You always owe in California, somehow, despite the homicide-provoking chunks they suck out of your every paycheck. See the classic Gatlin Brothers song for more detail.)

Block also emails you all sorts of stuff at the end: confirmation your e-files were filed, then confirmation they were accepted by the IRS or state authority, and (optionally) your Adjusted Gross Income and “pin number” that you need to digitally sign your returns. You might see the emails as overkill, but I like having confirmation that everything actually got done .

The one improvement I could make of H. & R. Block’s interface is in navigation. When you need to go back to something you’ve already passed, you get this tree menu of options, and what you’re looking for may not be in there. For example, to re-do my depreciations, I had to click in the “Self-employment” section and then click through all the screens to get to depreciations. There wasn’t a way to navigate straight to it – or if there was, it wasn’t obvious to me. In TurboTax, when you click a general topic, it brings up a screen listing all the sections and you click the one you want.

Bottom line

Compared to TurboTax, the H. & R. Block interface keeps it simpler and offers better help when questions aren’t clear. It’s cheaper, and includes your state e-file and, in the package for people who need Schedule Cs, a free session with a tax expert if you need it. I found it quicker, easier (despite the minor navigation complaint) and cheaper. And I got a better refund.

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Posted in Do It Yourself, Frugal on February 9, 2010