Cash App Taxes debuted five years ago under the name Credit Karma Tax. It was a unique service compared with other tax services, providing free federal and state tax preparation and filing, and supporting most major IRS forms and schedules. It was a good-looking tax website with intuitive navigation tools, to boot. Since last year, the site was acquired by Block, Inc. (formerly Square, Inc.), a company well-known for its online payment tools and other apps. Now called Cash App Taxes because of its tight integration with Block’s Cash App, it remains one of the best online tax prep tools.
Cash App Taxes is best suited to individuals who either have simple returns or are very tax-savvy, as its help content is not nearly as robust as its competitors’. The fact that it’s free is appealing, especially at tax time, but competing services explain the tax code in much more detail, and that might end up saving you both money and time in the long run.
Pricey Competition
After a year when so many Americans had to start new businesses or take on side gigs because of the still-unpredictable economy, it’s helpful that Cash App Taxes provides a free path to filing Schedule C, which is required if you have self-employment income. Competitors, with the exception of FreeTaxUSA (free for federal, $14.99 for state) and TaxSlayer Classic ($17.95 for federal, $36.95 for state), charge a lot for self-employment support.
TurboTax Self-Employed is the most expensive. It costs $119 for federal and $39 for state (if a long history repeats itself, those prices will go up later in the filing season). Granted, TurboTax offers an outstanding user experience, digs deep for deductions, and gives you unparalleled support options. But self-employed taxpayers can file a 1040 with the requisite forms and schedules for free using Cash App Taxes.
Cash App Taxes got its name because of a required integration of the tax prep website with Block’s Cash App, which launched in 2013 as a peer-to-peer money transfer service. It has grown to include access to related financial services for spending, sending, storing, and investing money. Its financial tools include direct deposit, a cash card, and fractional investing in traditional stocks and bitcoin.
A Familiar Approach to Taxes
If you’ve ever prepared taxes by hand, you know what a time-consuming, confusing, and frustrating process it can be, especially if your return requires filing multiple forms and schedules in addition to a 1040. You have to do all the calculations yourself, and that’s after finding the correct forms, schedules, and tax documents you need. Likewise, you have to transfer the correct figures from the correct documents onto the correct lines on form 1040.
Like all tax preparation services, Cash App Taxes provides an online alternative to doing your taxes on paper. It takes control of the whole process like a human tax preparer in an office might do, asking you questions and recording your answers. You simply read the questions on the page and provide answers by clicking buttons or entering data before moving on to the next set.
Cash App Taxes works in the background as you progress and enters your answers on the correct lines of the appropriate forms and schedules after it does all the necessary calculations. If you run into an unfamiliar concept, you might see help content that you can consult. When you finish entering everything that pertains to your federal tax situation, the site transfers the relevant data over to your state return, if you’re required to file one. After the site reviews your return for errors and possible missed deductions, you can pay for the service and file. All personal tax preparation services work this way.
Getting Started With Cash App Taxes
To start using Cash App Taxes, you have to go through an unusual set of steps, starting with signing up for a Cash App account. It doesn’t require much information, just your birth date, the last four digits of your Social Security number, and a few other details. You can also connect an external bank account to it for moving funds.
I’ve never seen a sign-in process like this. The first time and every time you want to log in to Cash App Taxes on your desktop browser, you have to first open the Cash App Taxes login page to get a QR code, which you then scan using the Cash App mobile app. Then you log in to Cash App Taxes using your phone. Both typed passwords and biometrics are supported. Once you’re logged in on your phone, the full application opens in your desktop browser.
Of course, you can just use the mobile app for tax prep if you prefer (more on that later).
Early Questions
Once you’re logged in and on the tax site, it asks you a series of questions about, for example, your filing status, dependents, and your 2021 income and expenses. The site uses this information to tailor your online experience. It also asks if you want to directly link your tax data to Cash App, which provides more refund deposit options. You must also enter personal details for everyone in your family, including name, address, and Social Security number, as well as answer some standard 1040-related questions. The site displays a summary when you’re done and moves you on to the tax preparation elements of the site.
Getting Down to Business
The topics you selected in your first steps appear in Cash App Taxes’ homepage, which you use to navigate the site. It consists of a series of blocks labeled with their content (such as W-2, Self-employed, and Family credits). You can still add topics at this point even if you didn’t indicate earlier that they applied to you.
If you haven’t visited a topic yet, there’ll be a button that says Start. If you have, it will say Edit/Review. When you click one of these buttons, the site walks you through a Q&A, asking detailed questions about your income and expenses. Sometimes a topic is broad enough that it will have several subsections. For example, when you click the Start button next to Self-employed, your options include Business income (Schedule C), 1099-K (Lyft, Uber), and 1099-NEC. Once you finish with a topic, you end up back on the homepage, where you can move on to the next topic.
H&R Block and other tax prep websites follow a similar navigation path. They quiz you upfront about your tax-related situations and organize the rest of the site’s path to make sure they’re covered, giving you the option to go beyond them if necessary.
A word about W-2s: If your organization uses ADP for payroll, you should be able to import your form data directly from ADP without having to upload anything. If not, you can either scan your W-2 or take a picture with your phone and upload it. Cash App Taxes automatically transfers the information from the form to the correct fields. Precision is critical here, and the company stresses that you should always double-check your numbers if you use the scanning method. You also have the option to enter everything manually.
Navigating Schedule C
Here’s an example of how Cash App Taxes’ Q&A navigation works. If you’re self-employed, you have to complete a Schedule C. You provide basic details about you and your business, like your address, business type, 1099 requirements, and prior year losses. Then you answer even more questions (Did you materially participate? Start or acquire the business in 2021? Cash or accrual?). Cash App Taxes then wants to know what your gross receipts or sales were and your returns and allowances, other income, and merchant card and third-party network payments.
You then enter your expenses by category (advertising, office expenses, and so on) and answer questions about the Qualified Business Income deduction. The site then walks you through topics like business use of home, vehicle and other expenses, health insurance and long-term care payments you made for you and your family, and depreciation. Cash App Taxes highlights the most common answers, as it does throughout the site, and lets you see the related Q&As as one long screen or in smaller chunks.
The Cash App Taxes User Experience
Cash App Taxes’ user interface is attractive and intuitive, better in fact than it was last year. It’s simple and clean and uses a pleasing combination of fonts and colors in a well-designed layout. Graphics are minimal and some screens are absolutely unadorned, which probably contributes to its speedy screen loading.
The vertical list of topics on the homepage is arranged more or less the way you would work your way through form 1040 and its supporting documentation, similar to the go-it-alone option other sites like Jackson Hewitt offer. No matter where you are on the site, you can click on a link in the upper right to drop down a menu that contains several housekeeping tasks, one of which is to return to the tax homepage directly. Once you finish a topic, you can return to the tax homepage and work on another topic. You can also view PDF versions of all the actual tax forms where you’ve entered information at any point in your journey.
Progressing through the site is easy. Sometimes, you simply click Yes or No buttons to move on. Other screens have straightforward Back and Continue buttons. Once you enter a topic area, the site makes statements or poses one or more (sometimes many more) questions on every screen. You respond in one of a handful of ways. Some screens contain blank fields for your answers. Sometimes you select an option from a drop-down list or click a button to provide your response.
On screens that contain an exceptional number of questions, like those supporting Schedule C, you can toggle back and forth between a full-form view and one that reduces the number of questions on each page. This view is unique to Cash App Taxes.
As generous as it is with the tax forms and schedules it offers, the site doesn’t support some critical forms, such as part-year or multiple state returns, Form 2210 (Underpayment of Estimated Tax), and Form 8885 (Health Coverage Tax Credit).
Reviewing Your Return
After you complete every relevant section, Cash App Taxes reviews your answers. If it finds errors or omissions, it offers to take you back to the offending screens to fix them. It also makes suggestions about where you might be able to save money. For example, it told me I might be eligible for the Recovery Rebate Credit if I hadn’t received the third stimulus payment.
Help, Reconfigured
Anyone who has ever prepared his or her own taxes knows that questions always arise and that getting quality help is absolutely critical. Cash App Taxes hasn’t had many years to build up the support resources that its competitors have, so the guidance it offers is still sparse in comparison. It does a fairly good job of letting you know what it’s looking for on every screen, but it doesn’t hyperlink complex terms the way TurboTax does, for example. The site often doesn’t even fully explain the current question or concept.
The service does display a small circled “i” at the end of many lines. These links offer brief explanations of the current topic, but some are sketchy, and others are not particularly useful. Take the Qualified Business Income deduction, for example. Granted, it’s an exceptionally complex area of tax law that can be puzzling even to financial professionals. But there’s very little information provided for a deduction that can save some businesses a lot of money.
This lack of detail occurs at various points throughout the site, even for simple concepts. In addition, the site sometimes directs you to consult an IRS publication, which is a serious drawback for a tax website help system (a few competitors are guilty of doing the same thing). Cash App Taxes does generally rephrase tax law into simpler terms for most topics, but not in nearly as much depth and breadth as rival sites do.
There are two additional ways to get help. Click the menu icon (three dots) in the upper right, and the Tax Help Center opens In a new tab. Here, you can either enter a search term or phrase or browse topics by category. Some of the educational content is quite good, simple, and well written. There are usually links to at least a couple of relevant articles—several, in some cases—but the additional links sometimes veer off into unrelated areas. For example, I landed on “What is the Moving Expense Deduction and how can I claim it?” while looking for information on medical expenses.
Other tax sites also dribble off into answers to questions you didn’t ask, similar to how a generic Google search works. H&R Block Deluxe, however, is much better at returning relevant, helpful answers to searches.
You can also click the question mark in the upper right, which opens a two-tabbed pane, one of which allows you to search for terms. I found it to be more helpful than the dedicated Tax Help Center. When I entered, “medical expenses,” it showed multiple jumps to related forms (but also to some seemingly unrelated or marginally-related forms). It, too, linked to articles in the Tax Help Center. It seems like these two options could be combined.
If you’re stumped, you can start a chat with a Cash App Taxes support team member 12 hours per day, seven days a week, though you can only get technical site help—not professional tax help like so many offer. You can also submit an email. I clicked on the Chat tab once but didn’t ask a question and closed it. I got an email later asking if I needed help, a nice follow-up that I haven’t seen elsewhere.
Security
Cash App Taxes is an authorized e-file provider, so it adheres to the security, privacy, and business standards set by the IRS. The company’s safety measures include 128-bit or higher encryption, a dedicated onsite security team, independent third parties that monitor the site for vulnerabilities, and multi-factor authentication with authenticator apps. It complies with applicable law and federal standards in terms of its physical, electronic, and procedural safeguards of taxpayer information. And it requires a secure login every time, as I described earlier.
Similar Mobile Access
I tested the Cash App Tax’s Android app and iOS app and found the functionality to be very good on both. The mobile tax-filing experience was very similar to what I saw via my desktop. The only real differences are the positioning of some help content and the navigation menu due to the smaller screen space, and the lack of chat help (which is expected to be added later in the filing season). Like the desktop version, the app is fast and free. It also looks great and uses the same data entry conventions as the browser-based version.
Help works the same way on the apps, though FAQs and article content take up the whole screen instead of overlapping. The glitch I ran across last year has been fixed. Now you click the “X” in the upper right corner or Done in the upper left to get to your original screen. It was a pleasure to use, working so well that it would be easy to complete even a complex return on it, as long as you don’t need a lot of help.
Room to Grow
Cash App Taxes claims to support major IRS forms and schedules, and indeed it does, at no charge for either federal or state preparation and filing. That said, it’s still missing some forms. Furthermore, some complex topics, like investment sales, do not receive the step-by-step data entry and guidance that sites like TurboTax offer.
A personal tax preparation website must have exceptional help resources if it hopes to serve taxpayers who need to wrestle with complicated topics like rental property income and self-employment. Cash App Taxes provides the tools for dealing with such complexity, but its guidance is still lacking compared with the competition. If you have a relatively simple return or you know your way around a 1040, it might serve you well. If either—or better, both—of these conditions apply to you, give it a shot. It is free after all, and if there’s one thing everyone thinks about at tax time, it’s dollars and cents.
While you’re thinking about your money, read our roundup of the best personal finance software. If you run a small business, we have you covered with the best accounting software.
