Most households with an income are required to file taxes every year, which is why it’s important to have a plan to put your tax return together by the due date every April. While many Americans choose to do their own taxes using tax preparation software (or manually), the easiest way to do your taxes is to having someone else take care of the math and paperwork for you. This is the benefit of using tax preparation services.
Tax preparation services are often more expensive than do-it-yourself options, but if you have very complex taxes, going to a tax prep expert could be a good decision. We reviewed 11 tax prep companies to determine the five best tax preparation services based on reputation, pricing, available services, and more.
Best Overall : H&R Block
H&R Block is our pick for best overall tax preparation service due to its large network of branches that offer several tax preparation options with reasonable pricing.
Drop-off, in-person, or virtual tax preparation services available
Choose from 11,000 locations
Pricing starts at $128 for a basic federal return and one state return
Additional costs per form can lead to high prices for some filers with complex taxes
Not all preparers are CPAs
H&R Block is a well-known name in tax preparation with the size and reliability to help it win our top spot. In addition to doing your taxes yourself with H&R Block’s software, the company offers three full-service tax preparation plans. For tax year 2019, H&R Block assisted in preparing 23 million tax returns, or about one in every seven tax returns in the United States. You can have your taxes done either at one of 11,000 H&R Block retail locations or through a new online service launching in January 2021.
For tax prep performed at an H&R Block office, you have two options. The first is an in-person tax prep service where you sit in the office (or at home on the computer) with a tax pro from a local office while your return is completed. The second option is a drop-off service where you leave your pile of tax papers, everything is calculated on the correct forms, then you come back to sign the final paperwork. In both cases, pricing starts at $69 for basic returns plus $59 per state.
A new option starting in 2021 gives you the ability to upload all of your forms for a fully virtual tax preparation experience. This means you get the full service of an H&R Block representative without having to go into an office. The combination of a large number of locations and multiple tax preparation options at a reasonable price makes it our best overall pick.
Best for Ease of Use : Jackson Hewitt
Jackson Hewitt gives you three easy ways to do your taxes with a professional through a Jackson Hewitt office (many in Walmart stores) or online, making the tax prep giant the best for ease of use.
6,000 office locations including 3,000 inside of Walmart stores
Appointments and walk-in tax preparation supported
Upload or drop-off forms to have your taxes prepared by a pro
Minimum tax preparation fee of $150 for federal returns
Pricing not clear and transparent on website
Jackson Hewitt makes tax preparation easy with several options to file either online or through a network of 6,000 locations, giving it the win for ease of use. If you want to have your taxes done while you shop for groceries, you may want to use one of the 3,000 locations inside of Walmart stores. Many locations have evening and weekend hours, so you can have your taxes done on a schedule that works for you.
For in-person tax prep, you can start by uploading your tax forms through the Jackson Hewitt website. You can even use your phone’s camera to take a photo and upload forms. If uploading proves to be problematic for you, head to a Jackson Hewitt location to drop off your tax documents and return later for your full tax review session. In-person meetings can be done by appointment or as a walk-in. Prices depend on how many forms are required to complete your return.
With flexible hours and the option to drop off or sit with a preparer while your taxes are done, Jackson Hewitt is a good choice for those who want a simple tax experience that works on their schedule.
Best Online Experience : TurboTax Live
TurboTax Live is an add-on to the TurboTax software that brings in a tax professional to complete your tax return for you.
Have your taxes prepared by a professional without leaving home
Four pricing tiers correlate to the complexity of your tax return
Option to start your taxes on your own and upgrade to a professional preparer
Self-employed taxes with one or more state can become expensive
No option for in-person support
Not all professional preparers are CPAs
TurboTax is perhaps best known as the largest provider of online tax preparation software and regularly ranks at the top of do-it-yourself tax program lists, but it also has a service where a tax professional takes care of everything for you online. It doesn't matter where you are in the online process, if you've begun your return and find you need help, TurboTax Live can be elected and you can hand the return off at any time.
For the full-service TurboTax Live option, pricing ranges from $130 for basic returns to $290 for complex returns, with an additional fee for state taxes and multiple forms. To upgrade from the software, the cost starts at $100 and goes up to $260 for complex returns. This is in addition to the software costs, which range from $0 to $120.
Because it’s completely online, TurboTax is best for tax filers who are more comfortable with computers and technology. That also means there is no drop-off option. However, if you are a digital native, TurboTax offers the most seamless, easy-to-navigate digital experience with pricing competitive to other tax preparation services.
Best for Self-Employed : EY TaxChat
EY TaxChat from Ernst & Young offers a professional tax filing experience powered through your phone or computer. With extensive business expertise, EY TaxChat is the best choice for self-employed filers and small business owners.
Get matched with a preparer who has experience handling tax needs like yours
Work with a tax pro with access to unlimited advice
Easy tax document submission using your phone or computer
Pricing may be high for those with simple or basic tax preparation needs
No option for in-person meetings or support
Ernst & Young is well known as one of the “Big Four” accounting, tax, and legal consulting firms trusted by some of the biggest businesses in the world. For individual tax filers, Ernst & Young offers a digital filing experience through its app, EY TaxChat, that makes more complicated self-employed taxes easier, thus winning this category.
With EY TaxChat, your taxes are prepared and filed for you. Before filing, you will work with a tax professional online. You will also submit all tax documents through your phone or via the secured web portal. EY TaxChat includes unlimited advice from a tax professional who you are matched with based on your specific tax situation, which gives you more specialization than you may get elsewhere.
Pricing starts at $199 and can go up depending on your needs and forms that need to be filed. While EY TaxChat can handle simple taxes, this Big Four tax firm is particularly attractive for independent contractors, sole proprietors, landlords, and other business owners who have more complex tax situations.
Best for Small to Mid-Size Businesses : KPMG Spark
Growing businesses have different needs than individuals. KPMG Spark is the service that’s best for modern small and mid-size companies that want online tax support from a team of business experts.
Work with a team of tax professionals at a Big Four accounting firm
Expertise in complex business tax needs
Advanced tax planning support from a dedicated accountant team
More expensive than a basic business tax preparation service
Offering may be too robust for some businesses
For businesses that want an online tax experience from a well-known name in business tax and accounting, KPMG Spark is a good fit. KPMG is a Big Four accounting and tax firm that handles taxes and auditing for Fortune 500 companies, making it ideal to help smaller companies with big company experience. In other words, smaller businesses can get the same expertise as Fortune 500 companies through an online relationship using the KPMG Spark service.
KPMG Spark offers full-service online bookkeeping and tax account services. Business owners can choose to engage in bookkeeping services to streamline tax prep or choose services a la carte. You'll need to contact KPMG to get a quote on how much your tax return will be based on its complexity and the number of required forms.
Businesses can use the web to connect to their assigned tax team, who are also available by phone, text, or email. Logging in to the web portal allows business owners to get tax information around the clock. Pricing is monthly with a flat rate starting at $195 per month (no added hourly fees or consultation charges). Your accounting team pulls in business transaction data right from your bank to its proprietary software. While this service may be more than some businesses need, the expertise provided by KPMG makes it the top choice for growing small and mid-size businesses.
What Is a Tax Preparation Service?
Tax preparation services are full-service offerings to complete your annual tax filing forms for the IRS and, if needed, state tax agencies. Unlike online and desktop tax preparation software where you do your own taxes, a tax preparation service will review your tax forms and complete your taxes for you.
Some tax preparation services are available through local offices in-person. Others give you access to a preparer or team of preparers online through a mobile app or website.
Who Should Use a Tax Preparation Service?
Tax preparation services are best for anyone who doesn’t want to do their own taxes for any reason. Whether you’re looking to save time, don’t know how to handle a complex tax situation, or just don’t like doing math or using computers for your finances, a tax preparation service becomes a good choice for you.
It’s important to note that you can likely save money doing your own taxes manually or with tax preparation software. Depending on your income and tax complexity, you may even have an option to do your taxes online for free. It is entirely up to taxpayers to use what gives them the most confidence in sending off IRS-related forms.
How Much Does a Tax Preparation Service Cost?
Tax preparation service costs vary based on the provider you choose and the complexities of your taxes. Of the services we reviewed, there were limited options under $100 and those would only work for basic taxes with no state filing. Most tax filers should expect to pay around $150 or more for federal and state tax preparation. Some tax preparers charge a flat rate while others may charge a fee per additional form you submit.
For more complex taxes or additional services including bookkeeping, tax consulting, and payroll, pricing can go up dramatically. Some business owners with complex taxes might pay over a thousand dollars for full-service tax consulting and preparation.
How Is a Tax Preparation Service Different From Tax Preparation Software?
Tax preparation services and tax preparation software get you to the same finish line, but the path there is very different.
With tax preparation services, you hand over your taxes to someone else to complete your tax forms. All you have to do is sign everything at the end and pay, though it’s always a good idea to review your professionally prepared taxes for any errors before signing.
When you use tax preparation software, you enter the details from your own tax forms into an online system that turns your tax data into finalized tax forms. These applications are available online through the web and mobile apps. Pricing typically varies depending on your needs, but is often less than you would pay for someone else to prepare your taxes for you.
DIY tax preparation software is best for those who are comfortable with computers. Even if you own a small business and have complex investments, you can usually do your own taxes using the right tax preparation software. But some tax filers prefer to have a professional handle the tax preparation instead. It’s up to you to decide what’s best for your unique tax filing needs.
How We Chose the Best Tax Preparation Services
To pick the best tax preparation services, we looked at 11 different tax services and narrowed down the list based on pricing, services offered, reputation, and the number of locations available for in-person tax preparation, if applicable.
Lower-priced tax services earned higher marks, though higher pricing was justified in some categories for specific types of service or higher levels of service. The winning tax preparation companies offered services that would appeal to a wide range of needs with competitive, reasonable pricing. The winning services demonstrate notable expertise within the specific categories reviewed.