Turbo Tax Online Price Increases in the decade through 2012 – A Comparison

Filing taxes using the Premium product of Intuit’s Turbo Tax Online in the 2012 tax year required paying $37.45 for the federal and $27.70 for the state filings. This pricing was after the click through discounts from Fidelity. Turbo Tax increased prices at a very fast pace during the period between 2003 and 2010. Below is a summary of Turbo Tax’s price increases for the decade through 2012.



YearFederalStateTotalYOY % Price Increase
2003$24.42Free$24.42NA
2004$29.95Free$29.9522.65
2005$24.95$9.95$34.90**16.53
2006$27.95$17.45$45.40**30.09
2007$37.45$22.45$59.90**31.94
2008$37.45$26.21$63.66**6.30
2009$37.45$27.70$65.15**2.34
2010$37.45$27.70$65.15**0.00
2011$37.45$27.70$65.15**0.00
2012$37.45$27.70$65.15**0.00

**The prices above are after click through discounts from Fidelity when filing before March 22nd. The discount was worth around $20 and prices went up by 50% when filing after March 22nd. For example, the premium product without the discount was $74.99 when filing after March 22nd and filing state was an additional $39.99 for a total of a whopping $115. There was no price increase in the three years through 2012 tax year. 

As far as alternatives, we tried TaxACT and H&R Block At Home (TaxCut) previously but ultimately stayed with Turbo Tax through 2012 tax year - we used the Deluxe product instead of the Premium product to reduce the price and also used the Fidelity click-through discount - even after all that, the final pricing was still a $30 premium over the comparable TaxACT product (Ultimate Bundle). For the 2013 tax year, we finally made the switch to TaxACT and that was overall very worthwhile .

Related Note: H&R Block tried to acquire (10/2010) TaxACT despite having a competitive product in H&R Block At Home (formerly TaxCut) but the deal did not go through due to anti-trust opposition. That essentially means the landscape will remain fairly competitive with these three main players.


There are a few other options to keep your tax filing costs down:
  1. Turbo Tax SnapTax for iPhone and Android can keep your cost to just $24.99 (increased from $19.99 last year). The pricing is about half when compared to the online product. 
  2. Opt for Turbo Tax Desktop Edition. Going this route saves you around 35% compared to the discounted pricing for the Online Edition. You can choose between a DVD and Download. Download is slightly cheaper and you get it almost instantly (~5 minutes if you have broadband internet connection).
  3. Get Turbo Tax Deluxe online edition for free by establishing a banking relationship with State Farm. 
  4. Intuit substantially increases the pricing of the software every year on March 22nd. So, you can save a bunch by filing before that date. 


Note: consider also what is available at the Amazon.com Tax Preparation Software area. The options there are suitable in case you prefer client software as opposed to online interface.


    2 comments :

    Andy said...

    Interesting analysis. Looks like the recession has hit turbo tax as well with price drops this year.

    Great blog you have here and as a fellow pf blogger always nice to discover other quality content.

    Charles said...

    My comments are on my experience with TurboTax 07 and 09. In reporting stock trades manually in '07 I inadvertently entered nonsense numbers for the year of trade. Instead of flagging this as a meaningless year of trade, Turbotax dropped the entry altogether. This was caught by the IRS of course as a stock sale not accounted for. It took 4 exchanges of information with the IRS to clear up this problem. Those of you who have dealt with the IRS can appreciate the stress caused by this mistake.

    This year '09 TurboTax online recognized that I had a capital gains loss from '08, but used 1040A which does not have a line for the $3,000 deduction. 1040 which does should have been used. I did not have any stock trades for '09, and this maybe the cause. But trading stocks should not cause carryover losses to be ignored. Not surprisingly, my '09 worksheet showed no capital gains loss carryover to 2010 even though the losses appeared under qualified dividends and capital gains section. . I have used TurboTax since it introduction. In the last few editions, I have noticed a progressive deterioration in attention to potential errors by the user.

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