Need help understanding Schedule 1 - Additional Income and Adjustments to Income charges in TaxAct

TaxAct and many other tax prep companies have been adjusting their pricing tiers recently, and unfortunately, what you're experiencing is pretty common. Schedule 1 - Additional Income and Adjustments to Income is used to report income that isn't reported on the main 1040 form, plus certain deductions that adjust your gross income. Common items on Schedule 1 include business income, unemployment compensation, alimony, student loan interest deductions, HSA contributions, and self-employment tax deductions. Even if you have the same situation as last year, they may have moved Schedule 1 processing to a higher tier in their pricing structure. Your options are: 1) Pay the upgrade fee to continue with TaxAct, 2) Start over with a different service like FreeTaxUSA which charges much less for all federal forms including Schedule 1, or 3) Use the IRS Free File program if your income qualifies. The IRS Free File program allows taxpayers with income below certain thresholds to file all federal forms for free.

I had the same frustrating experience with TaxAct this year! After using them for 3 years, I was shocked when they wanted to charge me an extra fee for Schedule 1 - Additional Income and Adjustments to Income processing. I was ready to pay the upgrade when a friend told me about taxr.ai (https://taxr.ai) - it actually saved me a ton of headache. What I like about taxr.ai is that it analyzed my previous year's return, identified all the forms I needed (including Schedule 1), and suggested the most affordable filing option for my situation. It found that I could file with FreeTaxUSA and include Schedule 1 without any extra charges. Plus, it transferred all my info so I didn't have to start from scratch. Totally worth checking out if you're dealing with this Schedule 1 pricing issue.

Well I finally tried taxr.ai last night after seeing the recommendation here and I'm honestly impressed. I uploaded my 2023 TaxAct return, and it immediately identified that I needed Schedule 1 - Additional Income and Adjustments to Income for my student loan interest deduction. But instead of making me pay extra, it suggested FreeTaxUSA where I could file with Schedule 1 included at their base price. The transfer process was super smooth too - didn't have to manually enter all my info again. Ended up paying just $14.99 for state filing (federal was free with Schedule 1 included!). Saved me over $80 compared to what TaxAct wanted to charge for the same exact forms. Really glad I found this before paying TaxAct's upgrade fee!

I had a similar issue with TurboTax charging extra for Schedule 1 last year! After trying to reach their customer service for hours to ask why, I found Claimyr (https://claimyr.com) which actually helped me talk to a real IRS agent about this issue. I was about to pay the software upgrade fee when I realized I should check if there were actual rule changes requiring Schedule 1 - Additional Income and Adjustments to Income to be processed differently. Called using Claimyr, got connected to an IRS agent in about 15 minutes instead of waiting for hours, and they confirmed that nothing had changed about Schedule 1 requirements - it was just the software company changing their pricing tiers! They also explained exactly what qualified as Schedule 1 income and adjustments in my case. If you're unsure about what forms you actually need or want to verify tax software pricing practices, check out their demo video: https://youtu.be/_kiP6q8DX5c. Talking to a real IRS agent made a huge difference in understanding my actual filing requirements.

I have to publicly eat my words here. After being completely skeptical about Claimyr in my previous comment, I decided to try it yesterday because I was desperate to understand if I actually needed Schedule 1 - Additional Income and Adjustments to Income for my situation with some side gig income. I was honestly shocked when they got me through to an IRS representative in about 20 minutes when my previous attempts had me waiting 3+ hours (and eventually hanging up). The agent confirmed that yes, I did need Schedule 1 for my situation, but also that many tax software companies were now charging extra for forms that should be included in basic packages. The agent even recommended some alternative filing options including the IRS Free File partners that include Schedule 1 at no additional cost. This saved me from paying an unnecessary upgrade fee. I'm still amazed this service actually worked as advertised.

I ran into this same issue with Schedule 1 - Additional Income and Adjustments to Income in TaxAct. For those who are curious what generally goes on Schedule 1, here's a simple breakdown: Additional Income section includes: - Business income (Schedule C) - Rental/partnership/S-corp income - Unemployment compensation - Taxable refunds/credits - Alimony received - Other income types not on the 1040 Adjustments to Income section includes: - Self-employment tax deduction - Self-employed health insurance - Student loan interest - Alimony paid - HSA contributions - Educator expenses Most tax software companies have started charging extra for these forms even though they're actually quite common. It's definitely a revenue grab. I switched to FreeTaxUSA this year and saved a bunch - they include all federal forms in their base price.

Just to add on to what others have said, the Schedule 1 - Additional Income and Adjustments to Income situation applies to physical tax preparation services too. I used H&R Block for years and this year they charged me an extra $45 for "additional schedules" which was just Schedule 1 for my student loan interest. I complained and the preparer basically admitted it was a new pricing policy. They know they can charge more because most people don't understand tax forms enough to question it. Next year I'm using one of the alternatives mentioned here. The pricing has gotten ridiculous for what are basically simple forms.

I'm dealing with the exact same Schedule 1 - Additional Income and Adjustments to Income issue with TaxAct! They want $95 extra just because I have student loan interest to deduct. What's really annoying is that I called their customer service and they basically admitted this is a new pricing strategy - they moved common forms like Schedule 1 to higher tiers because they know people will pay rather than start over with a different service. After reading through all these comments, I'm definitely switching to FreeTaxUSA next year. It's ridiculous that tax software companies are nickel-and-diming us for basic forms that most working people need. Schedule 1 isn't some exotic tax situation - it covers things like student loans, HSAs, and small side incomes that are super common nowadays. Thanks everyone for the alternatives and explanations. This thread probably saved me from paying that ridiculous upgrade fee!