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Best Tax Software for Self-Employed

H&R Block

A Business News Daily Review

Product and service reviews are conducted independently by our editorial team, but we sometimes make money when you click on links. Learn more.

Whether you're a freelance photographer or the owner of a one-person shop, self-employment can add more hurdles to tax season. Just as for other types of business owners, your tax situation is fraught with more forms than the average individual. Picking the right tax software can help you navigate the tax filing process and alleviate the headache.

To find the best tax software for the job, we conducted multiple rounds of testing, which led us to again recommend H&R Block as the best tax software for self-employed filers. We came to that conclusion after spending time with a variety of online tax software options that offer their services for freelancers, independent contractors, and companies incorporated as LLCs or partnerships.

To understand how we chose H&R Block, you can find our methodology and a list of online tax software vendors on our best picks page.

Of all the services we tested, H&R Block had the most suitable features for very small businesses and self-employed filers. The software's tax preparation and filing platforms are easy to learn and navigate. It covers federal taxes extremely well and offers tools to file state taxes, albeit for an additional $39.99 charge.

In addition to the company's online and downloadable tax programs, users can have a tax professional assist (either in person or online) or take over for an additional fee. Since one mistake can mean audits and fees or worse, the option to get help from a professional can provide peace of mind.

During our time with H&R Block's online software, we found it to be very user-friendly. The interface is attractive and logical, making it simple to navigate. After you enter some basic information about yourself (such as your full name, birthdate and Social Security number), it takes you to the main screen. On the top of the screen are four tabs: Overview, Federal, State and File. Under each of those tabs are sections for your income, deductions, credits and more.

As you provide more information, the software fills out each appropriate form and displays updates to your federal and state tax return figures in real time. If the software detects any errors in the process, it flags them for you to fix. Once complete, the final forms are displayed so you can give them a once-over before filing them. Throughout the process, your data is protected with high-powered encryption.

In addition to a positive user experience, we found several major features that set H&R Block apart from the rest. The software automates several processes to ensure accuracy and make tax filing as easy as possible. Here are some of the things H&R Block's online tax software offers:

  • Free imports: H&R Block can import your data from your W-2 or from other leading software, like TurboTax or Quicken, so you won't have to redo all that data entry if you're switching from another vendor.

  • Step-by-step filing: The software guides you through the filing process by displaying prompts in plain language. The instructions are easy to understand and follow, keeping you on the right track as you proceed.

  • Filing forms: The premium version includes support for itemized deductions, investment income, retirement income, self-employment income and rental properties.

  • E-filing: You can send your tax filings directly to the IRS through the software. Data sent through the program is encrypted and secure.

  • Reporting assistance: This feature is available for managing income from capital gains, home sales and retirement assets.

  • Free storage: The software can archive your documents for later use, whether it's for a personal accounting need or in the event of an audit.

  • Maximum refund guaranteed: If using another vendor's software results in a larger tax refund, H&R Block will refund any fees you paid to it for your tax return.

We found that H&R Block's online tax software is finely tuned for accuracy. Whenever we entered an item incorrectly or placed something in the wrong field, we were notified of the mistake. Human error can result in mistakes that attract scrutiny from the IRS in the form of audits, fees and other penalties. The safeguards in H&R Block's platform help you feel confident that your returns are accurate.

The program also tries to help you get the biggest return possible by searching its extensive deduction and credit database to see if any are applicable to your specific situation. Like the rest of its features, this assistance is automated.

If you need a human touch to check your deductions and overall tax return accuracy, the company gives you access to the insights of a tax expert on its staff for no additional cost. You can receive this help either online or in person at participating H&R Block locations.

For an additional fee, you can have your taxes prepared by a professional either online or in person. You can even drop off your tax documents at your local H&R Block and have them contact you when they're done. This costs an additional $49 for online tax prep and $59 for the in-person or drop-off service.

H&R Block also offers tax audit services and assistance from tax professionals. If you're targeted for an audit, these additional services might prove especially useful.

As with anything tech-based, things can go awry with tax software, so you need a company with responsive, helpful customer support. During our testing, we were impressed by H&R Block's customer service. We spoke with customer representatives over the phone, as well as through the live chat service, and found ourselves speaking with an engaged, knowledgeable person each time.

Both customer service and technical support teams provide live chat assistance on the company's website. Phone support is also available 24/7. In case you prefer in-person assistance, H&R Block is one of the largest tax preparation companies in America, so the odds of finding a physical location nearby are pretty good.

While we are very confident in H&R Block's suitability for microbusinesses and self-employed filers, it costs extra to file state taxes. On top of paying nearly $79 for the self-employed online option or $75 for the downloadable software, each state tax filing costs an additional $39.99.

Already prepared to choose an online tax software application? Here's a breakdown of the rest of our coverage:

Andrew Martins

Andrew Martins is an award-winning journalist with a Bachelor of Arts in journalism from Ramapo College of New Jersey. Before joining Business.com and Business News Daily, he wrote for a regional publication and served as the managing editor for six weekly papers that spanned four counties. Currently, he is responsible for reviewing tax software and online fax services. He is a New Jersey native and a first-generation Portuguese American, and he has a penchant for the nerdy.