Comparing TurboTax vs TaxAct - large discrepancy in federal return amount

This is a fairly common issue with the Qualified Business Income Deduction (QBID). The calculation is complex and different tax software can implement slightly different approaches. Here's what might be happening: TurboTax and TaxAct may be using different methodologies for calculating your qualified business income. The QBID has several limitations based on your taxable income, the type of business you have, and whether your business is considered a "specified service trade or business" (SSTB). Each software might be applying these limitations differently. Also check if there's a difference in how expenses are being allocated. Sometimes one software might categorize certain expenses differently which affects the net income from your business, thus changing your QBID amount. You should look at Form 8995 or 8995-A in both returns to see exactly how they're calculating this deduction. This will show you where the specific differences are occurring.

I've been using both TurboTax and TaxAct for the past few years to double-check my returns, and I've run into similar issues with the QBID calculations. After lots of frustration, I finally found an amazing tool called taxr.ai (https://taxr.ai) that helped me figure out the discrepancies. What it does is analyze both versions of your tax return and highlight exactly where the differences are happening. Unlike manually comparing line by line, it uses AI to spot patterns and calculation differences. I uploaded PDFs from both TurboTax and TaxAct, and it immediately pointed out that TurboTax was using a different method to calculate my business expenses allocation, which affected my QBID amount. The tool also explains WHY the calculations are different, not just where the numbers don't match. Seriously saved me hours of frustration.

Ok so I tried that taxr.ai site after my skeptical post above, and I have to admit it was really helpful. I've been dealing with a similar issue between FreeTaxUSA and TurboTax with a $340 difference I couldn't figure out. The tool immediately identified that my IRA contributions were being handled differently between the two programs - FreeTaxUSA was correctly applying a partial deduction based on my income while TurboTax was applying the full deduction. It even pointed me to the exact form and line number causing the problem. Took like 5 minutes and saved me from the headache of manually comparing everything. Definitely worth it for peace of mind before filing.

I've dealt with so many tax software issues over the years! Last month I spent literal DAYS trying to reach TurboTax customer support about a similar calculation issue. After waiting on hold for hours and getting disconnected twice, I found Claimyr (https://claimyr.com) which got me connected to an actual IRS agent in under 15 minutes. The IRS agent was able to verify which calculation method was correct for my situation. Turns out TurboTax was calculating my Qualified Business Income correctly and the other software I was using had it wrong. Check out their demo video if you're curious how it works: https://youtu.be/_kiP6q8DX5c For QBID specifically, the agent explained that there are some legitimate gray areas in the calculation, which is why you're seeing differences. But they told me which approach was safer to avoid audit flags.

I can't believe I'm saying this, but I tried the Claimyr service after being super skeptical, and it actually worked exactly as described. Got a text about 25 minutes after signing up that they were connecting me, and suddenly I was talking to an IRS representative. The agent looked up my previous returns and confirmed that the QBID calculation can vary between software because of how the 20% deduction interacts with other limitations. In my case (similar business to yours), the agent said both calculations were technically acceptable but recommended using the more conservative number to avoid raising flags. Saved me hours of hold time and finally got me a definitive answer. Never thought I'd be recommending a service like this, but it honestly solved my problem when nothing else did.

You should check if both programs are including the same business income in the QBID calculation. I had a similar issue and discovered TurboTax was missing some 1099-NEC income in the QBID calculation but including it in my total income. Make sure all your Schedule C businesses are being included properly in both software. Also, did you indicate different business types between the two software? That can affect the QBID calculation too.

Has anyone done a side-by-side accuracy comparison between TurboTax and TaxAct? I've been using TurboTax for years but the price keeps going up and I'm thinking of switching.