# Alternatives to Turbo Tax



## TaxPerplexed

I do not want to use Turbo Tax to file our US tax return (federal only; no state return required). But are the alternatives for expats any better?

I've just started researching, and I'm aware of H&R Block ($104.99), Tax Slayer ($47), and Tax Act ($109.95), as well as My Expat Taxes (149 Euros), and I'm now going to look into them more carefully. In addition, I also found an IRS link for expats to something called "Free File", and when I answered the IRS Free File online questionnaire, it told me _"Based on the information you provided, you may be eligible for Free File Online"_ using the following 3 services:

Free 1040 Tax Return

FileYourTaxes.com

Online Taxes at OLT.com

I'd appreciate advice from expats using Forms 1116 and/or 2555, and with actual experience using any of these paid or free alternatives to Turbo Tax.

Our situation, in a nutshell, is that my wife and I live and work outside the USA, and last year, we needed to submit a joint US return with

 Form 1040 with Schedules 1, 2, & 3
 Schedule B for bank interest and mutual fund dividends
 Schedules C (one for each of us)
 Schedule D for mutual fund capital gains
 Schedules SE (one for each of us)
 Form 1116 Foreign Tax Credit
 Forms 2555 Foreign Earned Income Exclusions (one for each of us)
 Form 4562 (Section 179 Depreciation)

Our AGI for last year, after taking the FEIE, was about $40,000. This year, our AGI should be considerably less than that. As I mentioned above, we do not need a US state return, just US federal.


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## Bevdeforges

Free File is a collective of tax preparation software companies who are supposed to provide free tax prep services to those on "lower incomes" - the pledge is something like at least one half of the taxpayer population should be able to use their services. Though you'll find that the options available to overseas taxpayers, especially those of retirement age, are fairly limited. (There are various limitations based on income, age and other circumstances.)

You can always try one or more of them and see how they do. If you don't like the results just don't push the button to e-file your return.

Otherwise, since you seem to be quoting the top drawer editions of the various products, I take it you have various private sources of income to declare which require the higher "fire power" of the top of the line package.

Generally speaking, the packages from the standard software houses should be able to handle preparation of your returns. You may or may not be able to e-file - if not, you just print off the forms and mail them in (along with whatever documents may be required - very often the main reason why someone can't e-file).


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## Moulard

The general practice with all of these providers is they slowly ratchet up their pricing from before the start of the tax year onwards. If you were to buy any of these in December you would find the price is about half what it is now.

I can only speak for TaxAct... I used the download version of their software for a number of years. I have had to stop using it because they no longer accept foreign credit cards for payment. I haven't had an active US credit card for nearly 20 years.

They don't offer a cheaper "federal only" version - but you can always select a state with no income tax.

I don't have anything to compare against (as I only used TaxAct; before that I downloaded the pdfs printed them out and posted my return), but my observation is that their federal Q&A is pretty good for those who limited understanding of tax affairs. However for some of the more complicated forms it can can be a bit daunting. While they tell you what you need to enter, they don't typically give any guidance on how to calculate the figure to enter. 

But if you already understand what forms you need to file, and I assume have been filing these previously, that is less likely to be an issue for you. 

Their help desk is pretty responsive too... There was one case where it was spitting out a value that I knew to be wrong and within about 48 hours they had troubleshooted my return and identified a data entry fault on my part.

I chose TaxAct because of its download version (at the time it was the only one offering it). I was looking at changing from using FEIE to FTCs and wanted to be able to model a bunch of different scenarios without having to do it all from scratch. 

Oh.. and by the way.. you missed form 6251 from your list - if you are filing form 1116 you will need to complete it although you may not need to submit it if the AMT amount ends up as Zero.


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## Bevdeforges

One small word of warning on using the tax software packages for doing taxes from overseas: the packages are very much designed for US residents. Some will handle "overseas taxpayers" but their questionnaires may not automatically prompt you for some of the finer points needed to get your "foreign" income into the right line or onto the right forms.

If you have a reasonable idea of how your income should be reported, you may just want to download the forms from the IRS site and fill them out yourself to mail in. Ultimately I found that to be the most practical approach.


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## TaxPerplexed

*Reply - Thank you!*

Thank you both for your helpful very replies. I do, in fact, have a reasonable idea of how the bulk of my wife's and my income should be reported, having filled out papers forms on my own for many years. But because our US reporting got a little complex (and slightly out of my comfort zone) for a few years, I enlisted professional -- and somewhat expensive -- help. Thankfully, from 2020 forward our tax reporting should start getting simpler again, and I'd like to resume filing my own returns. 

I'm actually fine with completing paper forms, provided I use registered mail to send them in. Ordinary Air Mail service isn't very trustworthy from here.

The reason I quoted prices for the higher "fire power" packages wasn't because of anything particularly complex. It was just that when I looked into things, the particular forms I needed for reporting side income (Schedules C & SE, and Form 4562) and handling our foreign income and taxes (Forms 2555 & 1116) seemed to rule out using the cheaper versions of Tax Slayer, Tax Act and H&R Block.

Perhaps I'll do everything I can on paper forms first, and then use one of the packages (free or paid) to confirm / check my work. If all goes smoothly, I can then possibly try filing electronically. 



> They don't offer a cheaper "federal only" version - but you can always select a state with no income tax.


That's helpful, too. Thank you.


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## Moulard

TaxPerplexed said:


> Perhaps I'll do everything I can on paper forms first, and then use one of the packages (free or paid) to confirm / check my work. If all goes smoothly, I can then possibly try filing electronically.


I did exactly that this year. After TaxAct told me that they weren't accepting foreign credit cards I went off and updated a spreadsheet I used to help do all the foreign currency conversions so that it would give me the line items for the key tax forms I use.

They then gave it to me for free... and so I was able to use it to verify all my calculations were correct.

So from now on I will be going back to the old PDF, print and post routine.


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