Best Tax Software for Self-Employed

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Contributor, Benzinga
June 23, 2023

Benzinga readers prefer TurboTax when they want the best tax software for self-employed workers.

No one enjoys tax time and not everyone has a personal tax preparer to track expenses and search for write-offs. Luckily, there are a host of affordable tax programs to help self-employed individuals maximize their tax return, savings and potentially a refund.

Self-employed professionals can benefit from cataloging expenses and tracking income with tax software as part of the tax filing process. Take a look at our review of the best tax software for self-employed individuals to get started.

Best Tax Software For Self-Employed

Take a look at the tax software that made the list and get started with your self-employed tax return today.

From minimizing your capital gains tax payments to tracking down every possible tax credit and deduction, tax programs do more than just help you stay organized. The software can also help extend the life of your business by saving you time and money as a self employed filer.

We’ve collected and reviewed some of the best self employed tax software programs for professionals handling their freelance business income, along with some additional tips that you can use to identify a great software provider.

1. Best for Live Tax Advice: TurboTax Premier

  • securely through TurboTax's website
    securely through TurboTax's website
    Best For:
    Live Tax Advice
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Intuit’s TurboTax is 1 of the most widely-recognized lines of tax software currently on the market. It offers both powerful and easy-to-use programs in an aesthetically pleasing package.

TurboTax’s design and flow are what makes the software shine. The software scrolls through a dynamic set of questions that change depending on how you answer them, much in the same way that a tax professional would conduct an in-person consultation.

The Premier version offers a particularly in-depth version of TurboTax’s standard software. It's best if you're self-employed. Premier has additional options for calculating brokerage taxes and taxes associated with buying and selling stocks, as well as taxes and deductions associated with owning and maintaining rental properties.

TurboTax Premier can also quickly calculate capital gains taxes and import entries from GainsKeeper.

The paid versions also support online chat options. And veteran TurboTax users will love how easily the software can pull information from last year’s data.

Pros

  • The software is easy for anyone to understand
  • The platform can calculate any sort of tax, no matter how niche it is
  • You can chat with an expert when you get stumped

Cons

  • Extra options come at a price

2. Best for Live and Online Tax Services: H&R Block Self-Employed

  • securely through H&R Block's website
    securely through H&R Block's website
    Best For:
    Live and Online Tax Services
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H&R Block offers a less expensive alternative to TurboTax without sacrificing functionality. Like TurboTax, H&R Block’s software is friendly and easy-to-use. But some users have complained about the software’s inability to interpret answers.

H&R Block offers additional assistance handling self-employment taxes and navigating the deductions for a contractor or business owner. It also provides audit support to help you understand any notice from the IRS.

H&R Block also prides itself on 100% accuracy. It's willing to reimburse you for any penalties due to error. 

Related content: How to File Back Taxes

Pros

  • Lower prices help make the platform that much more affordable
  • Reimburses for errors it made
  • Asks for all the documentation you will need

Cons

  • Software may not be able to interpret some fo the answers you give

3. Best for Seasoned Business Owners: TaxAct

  • securely through Tax Act's website
    securely through Tax Act's website
    Best For:
    Seasoned Business Owners
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TaxAct is a budget-friendly alternative with packages that range from its free version to special software for freelancers and the self-employed. Prices range from $0 to $49.95. 

TaxAct offers a money-back guarantee. Accuracy is guaranteed with up to $100,000 in compensation for errors.

The lower price point means you lose some of the bells and whistles that guide H&R Block Premium and TurboTax. But the system is more than capable of handling most types of self-employment.  

The Life Events section is particularly useful if you've undergone a major life change this year. It hones in on factors that differ from your previous return like filing status, property ownership or tax bracket. Then it clearly explains how this change will affect your return.

TaxAct loses points for its interface. It's a bit more cluttered than its competitors, but the software still shines if you need a cheaper alternative.

Pros

  • Low prices help you keep more cash in your pocket
  • Compensation guarantees are rather high
  • Handles self-

Cons

  • The user experience may be confounding for some users

4. Best for a Free Version: TaxSlayer

  • securely through TaxSlayer's website
    securely through TaxSlayer's website
    Best For:
    A Free Version
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TaxSlayer is a family-owned, cloud-based tax prep platform. It offers simple technology and step-by-step instructions to file state and federal taxes. 

TaxSlayer keeps it simple but efficient. You won’t be unpleasantly surprised with add-on fees for obscure deductions or needed tax forms. 

You can choose between 4 subscription packages, which all cost less than $50. And if you’re an active duty military member, you can file your federal taxes completely free of charge. State returns will cost you an additional fee. TaxSlayer also offers a completely free version of its software for simple, straightforward tax returns. 

Take advantage of TaxSlayer’s resources to keep up with changing tax laws and reforms. It guarantees you’ll get your largest possible refund using its software and tax reform calculators.

Pros

  • Multiple subscription packages make it easier to customize your experience
  • Add-ons help you handle the more complex parts of your return
  • You can pull all the tax forms that you need and even print them

Cons

  • You may not be experienced enough to understand some of the resources

5. Best for Fast Returns: Liberty Tax

Liberty Tax is an all-in-one tax solution for anyone who just wants to get their taxes filed and move forward. Liberty Tax works for everyone, but it is especially adept at helping:

  • Those in complex financial situations
  • In-person
  • Those who want to move fast
  • Filers borrow against their refunds
  • With the mobile app

While there isn’t an option to file a free federal return, this tax service does everything else you need when your tax documents come in.

Pros

  • Borrow against your return to improve cash flow today
  • You can do the return online or in the store with a tax expert
  • Transition between the desktop and mobile version at any time

Cons

  • Borrowing against your return may prove to be a poor decision

What is Tax Prep Software—and Do You Really Need It?

Many Americans use tax prep software to compile their tax documents, calculate their business income (net income and gross income), access a tax pro and reach out for tax assistance when needed. Tax software can help self-employed individuals quickly file their taxes and locate deductions.

Self-employed men and women often have more complicated tax returns. There are a host of 1099 forms to compile and enter and self-employment taxes to pay, but there could be a tax deduction around the corner for a range of business expenses, sales tax must be calculated, a state tax return must be filed and these software vendors make accommodations for these items. Therefore, you don’t have to worry about forgetting certain pieces of tax data, latent tax information that seems unimportant to you, etc.

Tax software can make filing your taxes easier because you have a tax preparer on your computer or mobile device. It can even analyze your tax return and expenses to find deductions that lower your tax liability. All types of self-employment are not created equal—one freelancer will like one free software platform while some prefer another.

Special and more in-depth tax software is also available for users who have particularly complicated returns. You might require special tax software if you:

  • Own Rental Property. Investment taxes, particularly those related to rental properties, are some of the most complicated in the tax code. A tax program with specialized content can help you work within the bounds of the law by locating and helping you pay taxes that you might not even be aware that you owe—as well as locating all deductions related to your property. This is especially helpful if you’re a real estate freelancer, flipper or seller.
  • Had a Major Life Change: Whether you’ve tied the knot, had a baby or recently switched careers, major life changes also come along with major changes to your tax documents. A tax program can help introduce you to the new taxes you’ll have to pay, as well as the new deductions you can now take advantage of.
  • Recently Became Self-Employed: If this is your 1st time handling your taxes as a self-employed individual or small business owner, a comprehensive tax program can be reassuring—and save you a massive amount of time and stress. Review every software provider so that you have a good idea of what works best for you.

Best Tax Prep Software Qualities

The quality and features of tax prep software vary. Double check to be sure yours has these basic features:

  • Quarterly tax payment support. As a self-employed individual, your taxes are not automatically deducted from the checks you receive like your counterparts who work for a larger employer. In addition to an annual tax payment, you are expected to make estimated quarterly payments on both the state and federal level.

    While these payments don’t have to be 100% accurate (they’re called “estimated payments” for a reason!), you may have to pay a penalty to Uncle Sam if you neglect to make them entirely. The best tax software programs for the self-employed can help you set up quarterly payments for the next year that are automatically deducted from your account every 3 months.
  • An easy-to-use interface. As an independent contractor or a small business owner, you’re busy enough as it is. Trying to work through a confusing or non-intuitive tax software isn’t just annoying—it can also increase the likelihood that you make expensive mistakes or miss a deduction.

    Check out a few YouTube tutorials before purchasing a specialized tax software program to make sure that the interface is easy to understand and at your level of technical skill.  
  • Guiding questions. Every self-employment situation is unique, and you need your tax software to ask you a comprehensive set of questions to ensure that you’re tracking down every deductible possible. The best tax software providers offer a long list of questions and use A.I. to cater to your unique business structure.

Tax Software Makes It Easy

Tax software can help you track your expenses throughout the year, so reporting is easy when tax season rolls around. You might be surprised to learn just how many deductions and write-offs you're eligible for. You could even deduct a portion of your mortgage, utility bills or even vehicle payments .

If you’re self-employed, Benzinga is here to support your financial goals—whether you’re looking to grow your business or just make it through this tax season. We offer a wealth of resources to help you. Check out our guide to saving for retirement when self-employed to get started. 

Frequently Asked Questions

Q

Can I use TurboTax if I am self-employed?

A

TurboTax offers several solutions, including TurboTax Deluxe, TurboTax Premier, TurboTax Self-Employed and TurboTax Live Self-Employed.

Q

What is the best tax software for the self-employed?

A

TaxAct, TaxSlayer, TurboTax Premier and H&R Block Self-Employed. 

 

Q

What is the best tax keeping software?

A

Many people prefer to use platforms like TurboTac to maintain their tax records, but you might also prefer to sync your accounting software with a tax filing platform, depending on your situation.

Related content: How to File Taxes for an LLC

About Sarah Horvath

Sarah is an expert in the insurance, investing for retirement and cryptocurrency space.