FreeTaxUSA Review: A Suitable $0 Option For Most Filers, But State Returns Cost Extra
JUMP TO Section Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.- Who Should Use FreeTaxUSA?
- Is FreeTaxUSA Really Free?
- How Does FreeTaxUSA Work?
- What Do You Get With FreeTaxUSA?
- Is FreeTaxUSA Reliable And Safe?
- What Are The Downsides to Using FreeTaxUSA?
Redeem now Our experts answer readers' tax questions and write unbiased product reviews (here's how we assess tax products). In some cases, we receive a commission from our partners; however, our opinions are our own.
- With FreeTax USA, federal returns are free regardless of how advanced your needs, but one state return is $14.99.
- Some competing tax software providers offer free federal and state returns for simple tax situations.
- FreeTaxUSA is missing a few nice-to-have features, like the ability to talk with a tax professional or upload documents for quicker data entry.
- See Personal Finance Insider's picks for the best tax software »
Hiring a CPA to file your taxes can cost a pretty penny. So you'll just file your own taxes online, right?
Well, depending on which tax-preparation software you use, filing online can be more expensive than you think.
For example, there can be a cost to filing online if you're deducting the interest paid on student loans. Oh, you own a rental property? You'll pay a little more. Are you a freelance worker? You'll pay even more.
So if you're filing on a tight budget, which software should you use? One of the least-expensive options is FreeTax USA. You'll be able to prep and file your federal return for free, and add on a state return for a low price. The platform is easy to use, though it is missing a few nice-to-have features, including the ability to talk with a tax professional and upload documents to save time on data entry.
Here's a look at how FreeTaxUSA works, how much it costs, and who it's best for.
| Editor's rating | 4.1 / 5 |
| Review summary | FreeTaxUSA is free, unless you need to file a state return. The interface isn't as advanced as higher-end competitors, but it is satisfactory for first-time and experienced filers alike. |
| Cost of DIY filing | $0 +$14.99 per state |
| Details |
|
Free version covers | Most tax situations |
File with FreeTax USA | |
Who Should Use FreeTaxUSA?
FreeTax USA provides quality software, especially considering the cost, though the user interface isn't as advanced as TurboTax or H&R Block.
You'll be able to access the basics with FreeTaxUSA. If you value low prices over a super convenient experience and don't need one-on-one help from a tax expert, then it's a strong choice.
You Might Like Filing With FreeTaxUSA if You:
- Don't qualify for free federal returns elsewhere
- Value affordability over convenience
- Don't mind extended wait times for customer support
You Might Not Like Filing With FreeTaxUSA if You:
- Qualify for free federal and state tax returns elsewhere
- Appreciate time-saving features like document upload
- Want personalized advice from an expert
- Have foreign earned income, are a nonresident alien, or live outside the US
TurboTax
TaxAct
FreeTax USA
Is FreeTaxUSA Really Free?
Based on its name, you can probably deduce that one of FreeTaxUSA's main selling points is that it's free to e-file your taxes. Despite the company's name, though, only federal tax returns are free. State returns cost $14.99.
You also have the option to pay $7.99 for the Deluxe edition. This upgrade will grant you access to priority live chat customer support, audit assistance, and unlimited amended returns. Deluxe may be worth it if you have a complicated tax situation or if this is your first time filing online.
If you're expecting a tax refund, FreeTaxUSA will ask if you want to use part of it to pay for its tax-prep services. It sounds more convenient than pulling out a debit or credit card on the spot, but beware: a $24.99 fee applies.
How Does FreeTaxUSA Work?
FreeTax USA's homepage, one thing might confuse you. It looks like FreeTaxUSA offers four plans: simple, basic, advanced, and self-employed. That isn't the case.
The website is just showing that you'll still file your federal returns for free, regardless of your tax situation. It's mimicking the offerings typically shared by other tax-prep sites.
Are you a homeowner? It's free. Are you self-employed? It's free. Do you have rental income? Well, you get the picture. There's only one platform that meets the needs of almost every filer. There are only a few situations it doesn't support, including foreign earned income, nonresident alien returns, and filers living outside the US.
The prep process is similar to what you'll find in other software. You answer a few questions and move through all the relevant tax forms where you can manually input your income and see if you qualify for certain deductions or credits. There are explainers of tax concepts along the way, and the software will perform the calculations. Eventually you'll see your estimated tax refund or tax bill.
What Do You Get With FreeTaxUSA?
- An easy-to-understand interface. FreeTaxUSA has a clean, modern, and straightforward user interface that guides you through the tax-prep process.
- No upsell. Because there's only one plan, your tax-prep experience won't be clouded by offers to upgrade to a more expensive product.
- Multiple refund options. You can get your refund deposited into your bank account, sent as a check, or loaded onto a prepaid debit card.
- Tax return storage. FreeTaxUSA will store your finished tax returns in your account for up to seven years.
- Accuracy guarantee. FreeTaxUSA will pay IRS penalties and fees related to calculation errors. If it's determined that you entered information improperly, the guarantee does not apply.
Is FreeTaxUSA Reliable And Safe?
FreeTaxUSA keeps your information secure with data encryption. It also requires multi-factor authentication every time you log in to verify your identity.
When it comes to calculating your taxes owed or expected refund, FreeTaxUSA is reliable.
What Are The Downsides to Using FreeTaxUSA?
While you can import prior-year returns to pull in some information automatically, one of the biggest downsides to FreeTaxUSA is the inability to upload tax forms like a W-2 or 1099 from your computer or a bank. If you have multiple streams of income or investment sales, automatic data entry can save considerable time.
You might come across online customer reviews in which users grumble about FreeTaxUSA not really being free since you have to pay for state returns. Even so, you're still probably going to pay less with FreeTaxUSA than most big-name tax prep companies if you have to file multiple tax forms.
However, TurboTax, H&R Block, and TaxSlayer offer free plans with free federal and state returns in some cases. So if you qualify to file with their free plans, there's no need to spend money with FreeTaxUSA. Plus, the bigger-name brands have more developed user interfaces, so you could end up paying less and having a more convenient experience — including document upload capabilities — if you qualify for free filing.
Laura Grace Tarpley, CEPF Personal Finance Reviews Editor Laura Grace Tarpley (she/her) is a senior editor at Personal Finance Insider. She oversees coverage about mortgage rates, refinance rates, lenders, bank accounts, and borrowing and savings tips for Personal Finance Insider. She was a writer and editor for Business Insider's "The Road to Home" series, which won a Silver award from the National Associate of Real Estate Editors. She is also a Certified Educator in Personal Finance (CEPF).She has written about personal finance for over seven years. Before joining the Business Insider team, she was a freelance finance writer for companies like SoFi and The Penny Hoarder, as well as an editor at FluentU. You can reach Laura Grace at ltarpley@businessinsider.com.Learn more about how Personal Finance Insider chooses, rates, and covers financial products and services » Read more Read less Tanza Loudenback Tanza is a CFP® professional and former correspondent for Personal Finance Insider. She broke down personal finance news and wrote about taxes, investing, retirement, wealth building, and debt management. She helmed a biweekly newsletter and a column answering reader questions about money. Tanza is the author of two ebooks, A Guide to Financial Planners and "The One-Month Plan to Master your Money." In 2020, Tanza was the editorial lead on Master Your Money, a yearlong original series providing financial tools, advice, and inspiration to millennials. Tanza joined Business Insider in June 2015 and is an alumna of Elon University, where she studied journalism and Italian. She is based in Los Angeles. Read more Read less Top Offers From Our Partners
Betterment Cash Reserve Account New Customer Offer: Earn 5.50% APY when you open your first cash account with $10 deposit. Terms apply. A tooltip *Current promotional rate; annual percentage yield (variable) is 4.75% as of 7/31/23, plus a .75% boost available as a special offer with qualifying deposit. Terms apply; if the base APY increases or decreases, you'll get the .75% boost on the updated rate. Cash Reserve is only available to clients of Betterment LLC, which is not a bank, and cash transfers to program banks are conducted through clients’ brokerage accounts at Betterment Securities. **The national average savings account interest rate is reported by the FDIC (7/17/23) as the average annual percentage yield (APY) for savings accounts with deposits under $100,000. Start SavingEditorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards.
Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.
**Enrollment required.
ncG1vNJzZmivp6x7o8HSoqWeq6Oeu7S1w56pZ5ufonyxsdGspqeZnGKzqrrAp5qeZ5ansqbAwLGsrJldp7K3tcSw