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Tax preparation software are one of the easiest and accurate ways of filing your federal and state tax returns. You can also e-file your returns with the Internal Revenue Service with these software. These software have a one-time cost and hence work out much cheaper than hiring an accountant who is going to prepare your tax returns. If you compare tax preparation software, many of them have similar features. Most of these tax preparation software have a user-friendly interface and are easy to use. They can guide the user in filling the different forms and will also catch errors that might have attracted a penalty if left uncorrected. The most attractive feature of these software is their ability to estimate the tax refund for which you will be eligible.

There are various review sites which compare tax preparation softwares and they also rank them according to the comments of a reviewer's panel. Among all the reviewed software, TurboTax seems to be the favourite of many reviewers. This software has an intensive interview process and is able to handle complex calculations like business deductions, tax on sale of multiple stocks, mortgage refinancing and depreciation of various assets. It has a guidance function which is more intuitive than other software, and has a detailed support system for intricate and uncommon aspects of tax filing.

The premier version of TurboTax has a preparation tool for federal tax and also for calculating the returns on sales tax. Five federal returns can be filed without any charge, and a return on state tax has a tag of $20. TurboTax also has a Deluxe version which does not have the tools for calculating tax on rental property and stock sales. This version has the State and Federal tax along with e-file.

When we compare tax preparation software we come across two distinct varieties, which are the online versions and the softwares which can be downloaded. The online tax preparation software is comparatively less costly and will prepare for free a single federal return. The state tax return is not included. Tax preparation softwares which can be downloaded are more expensive and will prepare more than one federal return and one state return for free.

Among the tax preparation softwares, TaxBrain is the only company that offers both online and download versions. A person can choose as per his tax filing requirements what works best for him.

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