Our first look at H&R Block TaxCut for the 2007 tax year reveals some key changes from the 2006 version, but nothing dramatic for the majority users.
TaxCut 2007 comes in four versions. We would advise skipping the $20 Premium because if you also need to manage state taxes, the separate TaxCut State costs an extra $30. The $40 Premium + State is a decent choice only if you plan to snail mail your return, because the $70 Premium + State + e-file covers the cost of filing electronically directly to the IRS. The $90 Home & Business edition is the better choice if you earn income outside of salaried work. All editions of TaxCut 2007 work with both Windows and Mac computers, except for the Windows-only Home & Business. For more hand holding, H&R Block provides the $80 TaxCut Signature, with which an H&R Block representative will review, edit, and e-file a return for you. TaxCut Online Office costs $100 and requires less data entry on your part, as a tax pro will do most of the leg work. The latter may be a good option for those who would prefer to fax data than manage it in a Web browser. p>
Setup and interface
Luckily, the modest system requirements haven't changed since last year. You'll need a computer running Windows 2000, XP, or Vista (or Mac OS X); a CD drive; and at least 128MB of RAM.
H&R Block also provides online editions of TaxCut that are extremely similar to the desktop counterparts. The new, Flash-based Tango tax preparation option also works within a browser. Although it includes 24-7 tech support, we find its $70 fee a bit steep. The Web-based software may better fit one person, while the desktop application can be used by multiple members of a household.
The desktop TaxCut took about five minutes to install, and another several minutes to download updates. Make sure to be online during setup so that the application will reflect the latest tax details. You'll be asked to register the software right off the bat, but you can fill out that form later.
Once TaxCut was running, we liked the tabbed interface that lets you skip among the topics, such as Federal, State, File, and Plan. Those who have used the company's tax products in prior years will notice a more streamlined appearance. For instance, the checklist no longer pops up in another window (although Help still does). A running tally of federal and state refunds appears too, as with TurboTax. We like the improved search capabilities, which make it easier to find details about tax questions that may leave you stumped, such as whether the alternative minimum tax may affect you.
The software immediately recognized our household's returns from last year--something that TurboTax failed to do in one case. Whether you import or start from scratch, one of the first steps involves telling TaxCut if in 2007 you had big life changes, such as major medical expenses, a move, or served in the military. Married couples should appreciate the Alternative Minimum Tax Estimator, which guides you through the ins and outs of tricky tax law.
H&R Block TaxCut can import data from Microsoft Money, Intuit Quicken, or from TXF files. Unfortunately, since our Money file was loaded with duplicate accounts we've never been able to weed out adequately, this wasn't so helpful in our case.
It was unclear why TaxCut's Guide Me questionnaire didn't qualify our fictional five-year-old daughter as a dependent. Since we described ourselves as single and not divorced, who else could claim the child as a dependent? We felt that TurboTax did a better job walking us through this process.