Like every other tax preparation website, TaxAct requests personal information, such as your birth date, filing status, and Social Security number, after you sign up for an account. You can enter this data manually or import it if you’ve used TaxAct to file in previous years. You can also upload such information from another tax website via a PDF file. Then, you move on to entering income (from sources such as an employer, gig work, or an investment), deductions, and credits.
You can either let TaxAct walk you through the whole 1040 step by step or select the tax topics that pertain to your financial profile, such as business and self-employed, medical expenses, and the child tax credit. I suggest the walk-through for novice taxpayers and complex returns, as TaxAct lets you skip earlier topics without completing them, which can cause you to miss critical data entry. Competitors don’t let you move on to the next topic until you complete the current one.
TaxAct doesn’t have a comprehensive navigation outline like FreeTaxUSA, but the dashboard for each major section (Income, Deductions & Credits, and Taxes & Miscellaneous) breaks down the 1040 into subtopics. You can tell which topics you’ve started because they show a status label, though this can vary between sections. If you get tangled up, you can always return to these dashboards via the toolbar in the left pane. Pages are visually appealing and easy to read, while navigation links are clear.
(Credit: TaxAct/PCMag)
That said, some tools should be more prominent. For example, clicking an unlabeled link at the top of the page offers four options. You can toggle your real-time refund number (or total owed). The Refund Snapshot displays two views of your return. One is a numerical summary, and the other is a series of three colorful charts that illustrate your total income and deductions (taxable income), your total taxes, and your federal refund or amount owed.
The Federal Summary breaks your current refund or taxes owed down into individual 1040 sections. Finally, you can turn on Line Item Details, which gives you access to a worksheet for fields where you need to total multiple numbers (such as business expenses on Schedule C). You can enter these individually and add notes to document what goes into a total. TaxAct doesn’t file this background information with the IRS.
The site introduced a helpful convention a few years ago that saves time and reduces confusion. Some forms, like the 1099-INT, have an interminable number of fields that few people will need to complete, and which might lead you to believe that you are missing something. TaxAct displays only the fields people are most likely to need, then asks whether there are others you need to fill in. If so, it opens them. Otherwise, you can just move on.
(Credit: TaxAct/PCMag)
