Sunday, June 20, 2021

Credit Karma tax prep is free and better than the rest

Do you get what you pay for or the best things in life for free? Credit Karma offers better-than-paid tax prep and it's free
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Credit Karma offers online tax prep for free. Die-hard TurboTax fans should give it a try. 

For the longest time, TurboTax was king. It’s been around since the the 80’s. If you’ve used it for years, all your tax returns are stored there for easy access. Your forms partly pre-filled for the next year, and it’s what you know.

Why should you ever switch from TurboTax? If you’re familiar with a tool there’s inertia. It takes effort to venture into the unknown, searching for something better. 

But that’s exactly what you should do, because TurboTax isn’t the best deal around anymore. 

Goodbye TurboTax

For one thing, TurboTax has gotten too expensive. If you file state and federal taxes, you’re looking at around $150-200. On top of that it’s not super easy to navigate the interface. 

TurboTax is arguably not very good at all for the self-employed. You can easily miss Schedule C deductions. 

If you’re a W2 wage earner, TurboTax looks for deductions though there are few if any when you take a standard deduction. But 1099 workers who take a standard deduction can also subtract expenses on Schedule C.

Unless it’s change very recently, TurboTax doesn’t invite you to Schedule C. It doesn’t seem to be geared toward 1099s. If you want to upgrade to a self-employed or deluxe version you have to pay even more. 

Why pay more? 

You can use Credit Karma online tax prep for free. There is no catch. It’s actually fre

Hello Credit Karma

Last year after filing my taxes with  TurboTax as I have done for years, I was walling in buyer’s remorse. 

Why did I DIY my taxes and still fork over enough money to buy a new accent chair for my living room? Inertia is the only excuse. 

Along came emails from Credit Karma, inviting me to do my taxes online for free. I vowed to try it this year.

The idea was to fill out the forms on both TurboTax and Credit Karma. How do they compare? 

I never got back to TurboTax. I was so favorably impressed with Credit Karma, I accepted their result and filed. 

Credit Karma is very easy to use and it takes you right to Schedule C. You can’t miss it. If you’re new to filing as a 1099, that’s incredibly important. 

The Credit Karma interface is simpler and easier to navigate. There’s a box at the bottom where you can search for anything from tips to sections and get great results.

Do you want to jump back to Schedule C? Just type “Schedule C” in the box. Not sure what “material participation” means”? Just type it in the box and learn. 

Handling complexity

Covid-19 added complexity to tax season this year. Would a free tool have all the necessary updates?

For example, Congress was late to the party but did pass a bill allowing people who collected unemployment to keep the first $10,200 tax-free. 

There were also provisions for people who took out money against their 401k. Penalties were waived and taxes were partially deferred over the span of three years. 

Can Credit Karma handle all that? You bet! It’s all there. So are your state tax forms.  

Credit Karma also offers audit-protection and free electronic filing. It’s hard to imagine simpler, easier tax preparation. A tool this amazing would be worth a fee, and yet it’s completely free. 

You can go back and check on your refund or get copies of your returns anytime. Like TurboTax, they keep everything on file for your convenience.

Other Perks

If you haven’t already, you should sign up for Credit Karma right away. You can get your credit score for free. You will also get regular analysis and recommendations delivered to your inbox. 

Credit Karma will find the best loan and credit card deals for you, and explain what’s improving or harming your credit score. You will also find tips on how to consolidate debt and so much more.

Years ago, you had to pay for this kind of information. Some of the major credit reporting agencies offered packages that were complex and expensive. 

I remember a time when it was difficult to sift through and find which package would give you your credit score! It was a nightmare. 

Now you have everything the major reporting agencies offered and more, and it’s all completely free. In case you’re wondering, no, I don’t get a kick-back for endorsing Credit Karma.

I’m sharing because I believer Credit Karma is amazing and everyone should know about it.

Conclusion

It’s a shame there are still people out there paying significant fees to prepare and file their taxes. 

Unless your taxes are exceptionally complex, you don’t need to hire an accountant. In my experience, many of them charge a fortune and leave you with a mess. After paying jaw-dropping fees in the past, I’ve felt completely ripped off and in some cases, wound up starting over, doing my won taxes from scratch.

The only good advice I’ve ever gotten from an expensive “expert” is that in Ohio, you don’t need to pay state taxes if you’re self-employed. That’s helpful, but not worth a fee that’s more than I make in a week—yes, it was that expensive!

DIY is the way to go for most of us, and now with Credit Karma, that option is looking better than ever. Sign up here for FREE.

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