Taxes are hard enough to do even with top-notch tax preparation software, so the more choices you have for getting them done, the better. H&R Block provides more options for personal tax preparation than any of its competitors, including in-office services, DIY software, online applications, and numerous options for virtual expert help. We took an early look at H&R Block Deluxe, which appears and works much like the other personal tax websites in H&R Block’s lineup. The Deluxe edition focuses on W-2 and interest/dividend income and supports the Schedule A, so you can see whether itemizing is better than taking the standard deduction.
H&R Block Deluxe offers a capable blend of tax topic coverage, usability, and taxpayer guidance, all of which earned it as Editors’ Choice award for online tax preparation services two years ago. The company has introduced numerous enhancements to its 2021 lineup (which you’ll use to file your 2020 taxes). There are new forms supported in its free version, for one thing. The company has also made improvements to its Virtual Assistant, W-2 import, mobile apps, and video help. H&R Block has also announced new integration with Wave, a free small business accounting service the company acquired a couple of years ago.
Like an Office Visit
If you’ve ever sat in a tax preparer’s office, you’ve probably noticed that they know what questions to ask—and in what order. Online personal tax preparation websites like H&R Block Deluxe work similarly, minus the in-person human interaction. You don’t see graphical representations of tax forms as you work. Rather, these sites use wizard-like tools to display their questions. When you supply an answer, the website works in the background to do the required calculations and fill in the official IRS forms and schedules.
As you advance through the wizard, you can track your progress through both occasional summaries of your work so far and real-time dollar figures representing what you owe or are owed at that point in the process. Help is available in a variety of ways. If you don’t understand a particular query, you can click links for more detailed explanations. The best services never expose you to the sometimes-complex language the IRS uses in its instructions. Instead, their tax experts rewrite the official texts with the average taxpayer in mind.
After you exhaust all the topics that apply to your financial situation, these websites do three things. They review your return and show you any problems they found, which you can correct. They transfer applicable data to any state returns you must file. They also walk you through the process of actually e-filing or printing your return. You can do everything up to this final step without paying the fees required.
How Much Does It Cost to Do Your Taxes With H&R Block?
There are four services in H&R Block’s main lineup. Free (both federal and state) supports the Form 1040 and situations like W-2 income, dependents, interest and dividend income, student loan interest, and retirement plan income. Deluxe ($49.99 federal and $36.99 per state) adds numerous features, including the option to itemize, technical support, self-employed income with no expenses, and the ability to organize and store your tax returns for up to six years. Premium, ($69.99 federal and $36.99 per state), adds Schedule D, E, and F), and Self-Employed ($109.99 federal and $36.99 per state), adds Schedule C and additional guidance for the self-employed). There are numerous add-on services that allow various ways to access expert help from tax professional (CPAs, EAs, and H&R Block agents). Pricing is not yet available for these but will be when we update this review in January 2021.
These prices are lower than those of TurboTax across the board. TaxSlayer’s $17 entry-level Classic plan is even more affordable, but if money is too tight to swing even that, Credit Karma Tax offers completely free federal and state filing, and FreeTaxUSA is free for federal and $12.95 per state. Note, however, that with the free services you sacrifice quite a bit when it comes to handholding, which most of us end up needing at some point during the process.
Tax prep services often change their prices throughout the tax season, and they tend to go up the closer you get to the filing cutoff date—a good reason not to be a last-minute e-filer. You may even be offered different prices for some services based on how you reach them online. The prices detailed here are the list prices. You may get a better price if you file early (keep in mind that IRS forms are not finalized, and filing does not open until late January).
Tax Prep Housekeeping
Before you start entering income and expenses, H&R Block Deluxe displays links to Q&As about how COVID might affect your taxes. Next, you have some housekeeping to do. You need to supply names, addresses, birthdates, and Social Security numbers for everyone in your household who will be included on your return. If you used H&R Block last year, that information should be transferred over automatically. for the 2020 tax year. You’ll need to specify your filing status and answer several other questions about things like your citizenship status and your dependents. There are more questions a little later on (after you’ve entered your W-2 information or imported it) about your profession, any foreign accounts or assets you may have, and your state of residence.
Income First
If you’re using H&R Block Deluxe, you’re likely to have income that was reported on a W-2 form. That’s the first income-related question the site asks about. There are three ways to provide this information. You can upload a PDF, take a picture of it with your smartphone after H&R Block texts you a link to a secure site, or fill in the fields manually. If you have other income, you then move on to a screen that lists every type possible, like self-employment—which is not covered by Deluxe. You can, however, provide information about income like interest and dividends, Social Security, and 1099-R retirement distributions. H&R Block Deluxe lets you connect directly to many financial institutions to import this data.
To visit a specific topic (like Interest, Dividends, and Capital Gains Distributions), you click the down arrow to the right, which opens the list of subtopics covered there. Each subtopic has a Visit Topic button next to it. Click it, and a mini-wizard walks you through the Q&A for that tax item. You provide the information requested by clicking buttons to indicate the correct answer, entering information in fields, and selecting from lists of options.
When you finish, H&R Block Deluxe opens a screen that recaps your activity up to that point. It displays a list of every topic you’ve visited and lets you revisit or delete any of them. At the bottom of the page, you can click the +Add income button to indicate that you must return to the income home page to visit more topics, or the Next button to see a summary of your responses (with your 2019 numbers for comparison) and move on to adjustments and deductions. Other services, like TaxSlayer, work similarly.
The rest of the tax preparation portion of the service functions the same way. H&R Block Deluxe presents a list of topics you might want to visit based on what it knows about you but gives you the option to visit others. After you’ve completed the Deductions section, you move on to Credits and Taxes, and finally, the Wrap-Up, where you can see a summary of your return and go back to change anything necessary. The site then transfers relevant data over to your state return and runs a review for that before you pay and file.
The H&R Block User Experience
Navigations is very simple and straightforward. You advance from screen to screen by clicking the Back and Next buttons. You do this throughout the site, though there are other navigation options, too. You can, for example, click a tab in the horizontal toolbar at the top (Overview, Federal, and so on) to see its subsections (like Income, Deductions, and Credits). Directly below this is a list of the forms you’ve completed; click on one to return to it. Links in the left vertical pane show you your real-time, ever-updating tax obligation or refund and take you to housekeeping pages.
The entire site functions in this way. H&R Block Deluxe makes it clear on each page what action you need to take and where you need to go next. But it lacks a comprehensive navigation tool like the one FreeTaxUSA offers. It also feels choppier than TurboTax Deluxe’s smooth, linear flow—at least in this early version we looked at. Even on screens where you’re just clicking Yes or No options, you still have to click the Next button to advance. That adds up to a lot of extra clicks.
H&R Block is a little more formal in its language and looks than the friendly—even folksy—TurboTax. It uses clear, understandable language, and its navigation and data entry conventions should be familiar to most taxpayers. The two sites simply have different personalities. TurboTax is the human preparer who greets you with a big smile and makes some small talk as he or she goes along. H&R Block is a bit more businesslike. Both are effective approaches.
Handy Help
The Q&A format that online tax preparation solutions offer works well if there’s always an option to have complex or unfamiliar concepts explained in more detail—without requiring you to open a giant help database and search for a term (though there’s a place for that, too). It’s critical for tax software to make context-sensitive help easily accessible.
H&R Block Deluxe does a great job here. Previously, it used pop-out windows to display explanations of hyperlinked words and phrases (TurboTax still does in many cases). Now, it reserves the right vertical pane for this. The pane can be toggled on and off, and it doesn’t obscure the working area of the screen as it did before. It’s always there, to the right, and it’s often displaying content-sensitive FAQs for the current page. TurboTax does something similar, but it doesn’t automatically change the help window to match each topic like H&R Block does.
Take the home mortgage section, for example. The site explains on the first page what it’s looking for and displays a hyperlinked “What’s a Second Home?” phrase. Click on it, and the right vertical pane displays text that spells out the answer in clear, understandable language. At any point, you can also enter a word or phrase in the Search field in the right vertical pane (you may have to open it; just click a help link on the main screen or the question mark icon in the upper right). Enter a word, like “energy,” and several suggested topics will appear, like “energy conservation” or “energy credit.” Select one, and you see links to numerous Q&As on the current topic, with a link to the related forms and occasional expert tips (educational articles on the current topic). TurboTax’s Search tool works similarly.
You used to be able to click the chat icon in the lower right, and the help pane would then explain the types of professional help available. The chat link now opens the Virtual Assistant, which starts an automated conversation with you about the word or phrase you entered.
If you have questions about the site itself, like where to enter an item, you can call a specialist during the service’s very generous business hours. Text chat is also available 24/7. If you have actual tax-related questions (Can I write this off? Do I qualify for this?), you can connect with a tax professional (CPA, EA, or H&R Block tax expert) in multiple fee-based ways that involve chat, phone, and video screen sharing. You can even upload all of your tax documents and let the pros prepare and file your return. Other sites like TurboTax offer connection to tax pros for a fee. Credit Karma Tax and FreeTaxUSA do not.
Review and File Your Tax Return
After you complete all of the federal tax steps, H&R Block Deluxe takes care of some additional tasks—such as creating estimated tax payment vouchers—and then provides a summary of your return. It also suggests forms you may have forgotten and lets you search for (and jump to) additional documents by form name or tax topic. This can be very helpful when you come to the end of your return and still have paper forms or unresolved issues, and it’s a feature not offered by Jackson Hewitt and some others.
Next up is the site’s Accuracy Review, which combs your return for anything that may be inaccurate or missing. If it finds something, it explains the problem to you and provides a Fix Issue button, which takes you to the offending screen for corrections and then back to the list of issues. After that, it’s on to your state return and e-filing the whole shebang.
Sound Security
H&R Block websites offer multiple layers of protection, including industry-standard web-browsing encryption technology and multi-layer authentication. Your personal data is protected and monitored 24/7. The company employs external security experts to perform audits and assess risks, and its data centers, network, and servers are housed in secure facilities.
The H&R Block Mobile Experience
The H&R Block Tax Prep and File app (Android and iOS) lets you access your return simply by entering your username and password. As we found last year, the apps do a beautiful job of replicating the desktop experience. Both versions offer simple navigation, an able help system, and comprehensive coverage of tax topics. Screens look just like they do on the browser-based version, with a few exceptions. For example, the mobile versions display icons at the bottom of the screen, replacing the desktop version’s toolbar.
A Reliable Option
H&R Block is a comprehensive, solid tax preparation website. Our own particular journey through the 1040 using H&R Block Deluxe went smoothly in testing, and we appreciate the ongoing changes made to the site. Whether you’re a return H&R Block customer or are in the market for the first time, you’ll find that this service combines exceptional preparation tools and guidance. Be sure to check in with us later this year to see our final, scored review.
While you’re thinking about your own money, you should read our coverage of the best personal finance software, and if you run a small business you might take a look at our overview of the best accounting software.
