Understanding the big changes in TurboTax’s software

Q: After years of using TurboTax, I’m not happy with the changes that they made to their software this year and am ready to try another option. Any suggestions on an alternative?

Tens of millions of us use our personal computers and tax preparation software to file our tax returns, and Intuit’s TurboTax has long been the most popular, but recent changes are angering a lot of their longtime customers.

They’ve been making a concerted effort for years to nudge desktop software users over to their online products by making them cheaper, but with fewer features. According to a company spokesperson, this year’s changes were designed to make the desktop version the same as the online version.

The result is surprising longtime users of the desktop versions of Basic and Deluxe because the price didn’t change, but the functionality did.

In particular, the Deluxe version no longer allows users to electronically file Schedule C (P&L for sole proprietor businesses), Schedule D (capital gains and losses), Schedule E (rental real estate, royalties and partnership distributions) or Schedule F (farm income).

Turbo Tax Deluxe will allow you to manually fill out these forms, but they won’t be included if you plan to file electronically.

Initially, Intuit reacted to the uprising by users on a case-by-case basis by allowing those that needed to upgrade to Premier to call a special number to request a free upgrade.

They’ve since stopped requiring users to state their case and have gone to an automated process for requesting a $25 refund for those that were forced to upgrade to either the Premier or Home and Business. This only applies to those that purchased the download or CD version (not the online version), used TurboTax Deluxe to file last year and have already filed using the more expensive package this year.

In other words, it’s for customers that were able to file their taxes in 2013 using the Deluxe package that were forced to use Premier or Home and Business to e-file their 2014 return.

If you don’t need any of the omitted forms, nothing’s really changed for you if you normally use the Deluxe package.

If you usually use TurboTax Basic, the Schedule A form for itemized deductions such as mortgage interest or charitable contributions is no longer included.

As you can imagine, competitors such as H&R Block are taking advantage of the confusion and anger by offering miffed TurboTax users an interesting option.

H&R Block is offering anyone who bought TurboTax Basic or Deluxe to switch to their Deluxe+State package, for free.

Just email SwitchToBlock@hrblock.com and include your name, address, phone number, the type of operating system (Windows/Mac) and include proof of purchase (a photo or scan of a store receipt or the email showing a download code).

Regardless of which channel you choose, if you’re going to use your computer to file a return, make absolutely sure it’s free of hidden malware first!