At first glance, you'll be hard-pressed to tell TaxCut and TurboTax apart, since they look nearly identical. Both programs rely on a Q&A interview for data entry, so you'll answer financial, lifestyle, and tax-related questions either by typing numbers or making selections from Yes/No or multiple-choice list. And both sport links to context-sensitive help files. TaxCut and TurboTax also fill out all the necessary forms for you or let you work directly on the forms if you want.
Both programs contain easy links to tax and program help. TaxCut's "Ask a tax advisor" button takes you online and, for $19.95 per topic, lets you ask an H&R Block expert a question via e-mail, real-time chat, or phone. Unfortunately, TaxCut doesn't let you select the expert who specializes in, say, small businesses or who also knows your state's tax laws, like TurboTax does.
However, like last year, TaxCut's written explanations still seem muddier than TurboTax's. When we hit the Capital Gains/Losses section, for example, TaxCut said, "In this topic, we'll ask for details about your 2001 sales of stocks, bonds, mutual funds, and other investment or personal property ('capital assets')." Huh? TurboTax, meanwhile, sports much simpler text: "Did you sell any stocks, bonds, or mutual funds in 2001?"
Other than these occasional lapses in clarity, however, TaxCut's interface and interview matches TurboTax's point for point; in a few places, TaxCut actually takes the lead. We love the way TaxCut's Take Me To... navigator displays a picture of exactly which parts of the return you have completed, which ones are still in progress, and which ones you have yet to begin. TurboTax still doesn't offer a similar status display.
Debut of data download
Just as TurboTax has stolen the "Ask a tax advisor" function from TaxCut, TaxCut 2001 practices a little pilfering of its own. Like its competitor, TaxCut now downloads W-2 salary and 1099 financial data directly from participating payroll companies and brokers, then automatically drops the numbers into your return. (Head to this TaxCut Web page for a complete list of participants.) But since this is the debut of Auto Entry, TaxCut's list is substantially shorter than TurboTax's.
This year, TaxCut also helps you navigate the wilderness of the new Tax Relief Act. TaxCut's Tax Law Assistant pops up with advice whenever the return reaches a spot where the law is different for 2001, much like TurboTax's Tax Law Advisor.
TaxCut has brushed up its data-importing skills, too. Now, you can copy year-round financial info from Intuit Quicken 2000/2001 (but not 2002) and Microsoft Money 2001/2002 and transfer last year's TaxCut or TurboTax return. We did, however, have a few troubles with TaxCut's import. One Money 2002 file wouldn't work at all (TaxCut kept saying our password was incorrect, but it wasn't), and TaxCut improperly imported another Money 2002 file (some numbers were missing, such as those for home mortgage). According to the company, the first problem is a known bug for which the site has posted a downloadable update. Our vendor contact says that the company will post an update to address the second problem shortly.
Get your services here
TaxCut boasts a small host of additions and enhancements, such as a retirement planner and a college fund savings planner, although many are designed to steer you to H&R Block services and separate you from your wallet. If you don't contribute to an IRA, for instance, TaxCut pops up with a screen that tries to sell you on H&R Block Financial Advisors' services. Getting a refund? TaxCut offers to use it to open an investment account with H&R Block. Or, you can send your finished return to an H&R adviser; for $30, he or she will look over the return and answer your questions.
Takes the same time to do as TurboTax
With all the similarities between TaxCut and TurboTax, we're hardly surprised that the two completed our sample return in a dead heat: around two and a half hours from start to finish, not including filing or printing. (Your mileage may differ, depending on how much data you import and from where and if you use the programs' automated W-2 and 1099 downloads.)
TaxCut's built-in help is outstanding--as good as TurboTax's--with much the same mix of IRS publications, tax tips, and video clips. But TaxCut's online help is lame, with little information posted now, but it will be updated continuously throughout the season. You can also send tech support and tax prep questions by e-mail or place a toll call for otherwise free phone support. During tax season (from January 6 to April 16), the lines are accessible 16 hours per day, Monday through Thursday, and 13 hours per day, Friday through Sunday.
Nearly as good as TurboTax but much cheaper
Of the three TaxCut editions--Basic ($10, after a $5 mail-in rebate), Deluxe ($20), and Platinum Home and Business ($50)--Deluxe is the best buy because it comes with rebates for a state return and one federal e-filing. We could do without the self-serving ads for H&R Block, but, otherwise, TaxCut is a good deal. These days, when money's tighter than Britney Spears's blue jeans, a bargain makes sense. For $10 less, TaxCut will prepare most returns as quickly and as thoroughly as TurboTax.