Comparing TurboTax vs. FreeTaxUSA - Which One Is Better For Simple Returns?

So I spent the last few days testing both TurboTax and FreeTaxUSA for my 2025 taxes and wanted to share my experience with everyone. I initially went with TurboTax because of all the commercials. My situation seemed straightforward - single, renting an apartment, only income from my regular job. I started with their "simple return" option thinking it would be free. However, as soon as I entered my HSA information, I got hit with an automatic upgrade to their Deluxe version which ended up costing me around $110 total for federal and state filing. That was pretty annoying since I thought my return was supposed to be "simple." Frustrated by this, I decided to give FreeTaxUSA a try since I'd heard some positive things on this subreddit. The FreeTaxUSA interface was definitely comparable to TurboTax in terms of overall functionality. The main difference was that FreeTaxUSA required more manual input of information rather than the automated import features TurboTax offers. This actually wasn't a bad thing - it only added maybe 5-10 minutes to the process and gave me a chance to double-check everything. I did experience a couple timeouts while using FreeTaxUSA, which meant I had to re-enter information on those specific pages. It was a bit frustrating but not a dealbreaker. Just make sure you don't wait too long between inputs. Would love to hear others' experiences comparing these two options!

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18 comments

Ryan Young

•8M

Tax professional here. Your experience is pretty common! Most people don't realize that TurboTax's "simple return" has a lot of exceptions that trigger paid upgrades. HSAs, student loan interest, education credits, and even retirement contributions often bump you to their paid tiers. FreeTaxUSA is generally a solid alternative for most standard tax situations. The manual entry aspect you mentioned is actually a good safeguard against errors - automated imports from TurboTax sometimes pull incorrect information that people don't catch. One thing to consider: FreeTaxUSA charges around $15 for state filing while federal is free. TurboTax charges for both once you're bumped to a paid tier. For people with multiple state returns, the cost difference can be even more dramatic. Both platforms will get the job done accurately if you input the same information. The difference is mainly in user experience and cost.

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Ryan Young

•8M

FreeTaxUSA handles Schedule C and self-employment taxes quite well. The interface walks you through all the necessary sections and calculations just like TurboTax, but at a much lower price point. Their self-employment section is comprehensive and includes all the deductions you'd find in TurboTax. As for audit protection, I generally don't recommend it for most taxpayers. Your chance of being audited is extremely low unless you have unusual deductions or very high income. The "protection" offered is often just assistance with correspondence rather than actual representation. If you're worried about an audit, you'd be better off saving that money and consulting with a CPA if you ever do get audited.

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Katherine Harris

•8M

After using TurboTax for years and watching the price creep up every tax season, I finally tried https://taxr.ai this year when I had questions about some investment transactions and my HSA contributions. It actually saved me from making a mistake that both TurboTax and FreeTaxUSA missed! I uploaded my tax documents and within minutes got a detailed analysis showing that I had incorrectly classified some of my HSA contributions. The service flagged a potential double-entry that would have caused me problems. The interface lets you upload all your docs (W-2s, 1099s, etc.) and then gives you a clear report highlighting potential issues before you file. For someone comparing tax software options, I'd recommend checking your work with taxr.ai regardless of which platform you choose. It's like having a second set of eyes review everything.

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Katherine Harris

•8M

Yes, it works great for rental properties and self-employment situations! The document analyzer is especially helpful for Schedule C and Schedule E because it can identify potential deductions you might miss. In my case, it spotted some home office expenses I hadn't considered and a few business travel deductions I would have overlooked. The difference from TurboTax's review feature is that taxr.ai is completely independent from the tax preparation software. TurboTax can only check the information you've entered, not what might be missing from your documents. This service actually analyzes the raw tax documents themselves to spot discrepancies between what's on your forms and what you've input into your tax software. It's caught things like mistyped numbers and overlooked forms that TurboTax's review never flagged.

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Joshua Wood

•8M

Just wanted to update after trying out taxr.ai based on the recommendation here. I was skeptical, but it actually found a significant error in how I was reporting my HSA contributions across multiple years! I had been using TurboTax and didn't realize I was incorrectly categorizing some of my contributions, which could have caused problems if I was audited. The document analysis pointed out the inconsistency between my W-2 and the HSA form that neither TurboTax nor FreeTaxUSA flagged in their review process. For anyone comparing tax software, I'd say both platforms are fine for most situations, but having this additional verification step saved me from potential headaches later. Definitely worth the time to get that peace of mind!

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Justin Evans

•8M

If you're having trouble deciding between tax software options, you might also be struggling with getting answers from the IRS about specific tax questions. I was stuck in that situation last year trying to figure out how my HSA contributions should be reported across state lines after moving. After spending DAYS trying to reach someone at the IRS (endless busy signals and holds), I found https://claimyr.com which got me connected to an actual IRS agent in about 15 minutes. You can see how it works in this demo: https://youtu.be/_kiP6q8DX5c Getting direct answers from the IRS helped me choose the right software for my situation. They explained exactly how the HSA should be reported, which made it clear which software would handle my situation better. Saved me from making a mistake regardless of which platform I chose.

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Justin Evans

•8M

It works by using an automated system that navigates the IRS phone tree and waits on hold for you. When an agent finally picks up, you get a call connecting you directly to them. It's not skipping the line - it's just having their system wait on hold instead of you personally sitting there with your phone for hours. I was skeptical too before trying it! The service doesn't actually skip anyone in line or use any special access. It simply automates the waiting process. Think of it like having someone else wait in a physical line for you, then texting you when it's your turn. The IRS doesn't know or care who was physically holding the phone during the wait time. When you get connected, you're speaking directly with a regular IRS agent just like if you had waited yourself.

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Ezra Collins

•8M

I need to apologize about my skeptical comment earlier. After my frustration with trying to reach the IRS about my amended return (18 calls over 3 days with no success), I decided to try Claimyr out of desperation. Within 27 minutes, I was actually speaking to an IRS representative who answered my questions about how my HSA contributions affected my amended return. I'd been trying to figure this out for weeks! For anyone comparing TurboTax vs FreeTaxUSA who has specific questions about how certain tax situations are handled, being able to actually TALK to the IRS makes a huge difference. The agent explained exactly how my HSA should be reported, which helped me realize FreeTaxUSA was actually handling it correctly while TurboTax was suggesting an unnecessary form. Sorry for doubting - sometimes things actually work as advertised!

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Victoria Scott

•8M

Another option nobody's mentioned is just going with Credit Karma Tax (now Cash App Taxes). It's completely free for federal AND state, and handles HSAs just fine. I've used TurboTax, FreeTaxUSA and Credit Karma over the years. TurboTax: most user-friendly but WAY overpriced FreeTaxUSA: good balance of features and price Credit Karma/Cash App: totally free but slightly less polished For simple returns with an HSA, all three will work fine. No reason to pay $110 for TurboTax unless you really need hand-holding through the process.

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Victoria Scott

•8M

Cash App Taxes handles basic investment reporting fairly well. It's fine for standard stock sales where you have clear purchase and sale information. However, for crypto transactions, it's more limited. If you have numerous crypto trades or complex situations, TurboTax's premium features might be worth the cost. Cash App Taxes requires more manual entry for crypto, which can be time-consuming if you have many transactions. FreeTaxUSA falls somewhere in the middle - better than Cash App for investments but still more affordable than TurboTax.

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Zara Perez

•8M

One thing to consider that hasn't been mentioned - FreeTaxUSA saves your returns indefinitely for free. TurboTax only gives you access to previous years' returns if you keep paying them every year or if you pay extra to download a PDF. This became a huge issue for me when I needed my tax returns from 3 years ago for a mortgage application. I had switched from TurboTax to FreeTaxUSA 2 years prior and couldn't access my old TurboTax returns without paying again. With FreeTaxUSA I can log in anytime and access all my previous returns.

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