Comparing our Personal Taxes with TurboTax, Ramsey’s SmartTax, and Professional Filing
Get ready for our Tax Software Review!
Table of Contents
Have you ever wondered if you’re doing your taxes right?
Are you getting the right refund amount?
Most people don’t love doing taxes.
It’s a part of ‘adulting’ that we all kinda dread. Getting all the forms together, receipts, mileage, and statements takes time. It’s the moment where you peel back the curtain and look at how much you really made and calculate deductions.
I was never taught how to do taxes. Honestly, I’ve happily let my husband handle this area of our lives. We’ve always worked with a professional, so James has always pulled together all the documents. This year, I decided that I’m going to actively participate and do our taxes. As financial coaches, we see this play out in almost every couple: someone does the majority of the finances and the other doesn’t. I’m guilty of this. I’ve been the one passing off prepping our taxes to James.
Instead of doing our taxes once (like everyone else), we did something different. James had the hair-brain idea to conduct our own tax experiment. We did a side-by-side comparison of TurboTax, Ramsey’s SmartTax (and that’s Ramsey, as in Dave Ramsey), and professionally done taxes. Apparently, if I do taxes in three different ways, I’ll really get it down!
For this tax software review, we sat side-by-side on two different computers filling out our tax information on these two pieces of software. I filled out TurboTax and James did Ramsey’s SmartTax. We didn’t end up submitting either, since we got our taxes done professionally.
7 Insights from our tax software review: Comparing TurboTax to Ramsey’s SmartTax
1. Which is faster – TurboTax or Ramsey’s SmartTax?
I wasn’t sure how long it would take, since we had all the documents ready.
Ramsey’s SmartTax took less time to complete than TurboTax. It took us about two hours to complete Ramsey’s SmartTax and two hours and twenty minutes to complete TurboTax. The nice thing about TurboTax is that they tell you the estimated time it will take to fill everything out, and it was three minutes shy of how long it took me. I was impressed!
2. Is TurboTax and Ramsey’s SmartTax accurate?
From filling out taxes on my own, I do feel like there could be errors. I’m not sure if we got all the deductions available. At some points in the process, I wanted to ask questions to a professional. If you’re trying to spend as little as possible on taxes, you probably press submit with a little hope and a prayer.
There’s a level of anxiety we experienced wondering if we’re doing this correctly when we used both software on our own. If we submitted them, I would never be 100% sure that we did everything right and that it’s 100% accurate.
3. Which tax software is easiest to use?
Ramsey’s SmartTax was overwhelming in sections. There were so many questions on each page. It was much more complex to fill out versus TurboTax. TurboTax, was more simplistic and had fewer things to answer on each screen.
4. They don’t ask the same questions.
Since we looked at each other’s screens throughout the process, I was surprised that they didn’t ask the same things and the order was often different. I was surprised that TurboTax never asked questions about our mileage for volunteer work, but Ramsey’s SmartTax did.
5. Expect upsells
TurboTax upsells you SOOOO much more than Ramsey’s SmartTax. I had at least four separate upsells before I got to the submit and purchase step. They wanted me to buy identity theft insurance, upgrade my tax software, work with a professional, give tax refund money away, and more.
Ramsey’s SmartTax didn’t do any upsells, except at the beginning. You can choose to add EveryDollar or upgrade to their premium tax software.
I still keep getting emails giving me 20% off if I submit my taxes through TurboTax. I’ve gotten fifteen emails from TurboTax trying to get me to file our taxes through them. I’ve gotten twenty emails from Ramsey’s SmartTax reminding me to submit my taxes with them.
6. Unexpected challenges
It was difficult to distinguish my income from James using TurboTax. Since we own our own business, our business gets paid, not us individually. We then pay ourselves a salary from our business. It was hard to separate the income between us on TurboTax. I ended up just putting all the income on James to make it easier. Which I know isn’t ideal.
7. Politics and taxes are mixed.
I was surprised that on both software there were opportunities to give $3 to the presidential election. Maybe I’m living in the dark ages, but that seems like a weird question to ask, especially in today’s world.
The Real Numbers:
After seeing the results of our own little tax experiment, my first thought was, we MUST have done something wrong. So, we double-checked the information because the refunds were VERY different. I mean cray-cray.
We used the same information to fill out TurboTax and Ramsey’s SmartTax, and we verified it with each other.
Here are the results:
Ramsey’s SmartTax:
Federal Refund: $3,789
Owe the State: $10
Total Refund: $3,779
TurboTax:
Federal Refund: $6,081
State Refund: $470
Total Refund: $6,551
Professional:
Federal Refund: $5,850
State Refund: $480
Total Refund: $6,330
Now, I’m pretty shocked at the massive difference between TurboTax and Ramsey’s Smart Tax. Honestly, it makes me really leery of using any of these. I didn’t feel overly confident with either result. If they were closer to each other, it would be a different story.
This again is confirmation to me that working with a professional is worth it. We’re financial coaches and we don’t DIY our taxes. We stay in our lane.
The Bottom Line
Overall, the difference in returns between the two DIY tax softwares was $2,772. That’s insane!!
Those results made us really uneasy. Having a professional do our taxes gave us peace of mind, and if we just used Ramsey’s SmartTax, we would’ve left thousands on the table.
We were happily surprised that TurboTax was much closer to the true refund amount. We’re getting $221 less than TurboTax, and $2,551 more than Ramsey’s SmartTax.
I do have to say that we used the same exact information for the Ramsey’s SmartTax and TurboTax. When we worked with a professional, we ended up claiming fewer miles, so that could have impacted our final result.
My biggest takeaway from this experiment is to hire a professional if you have a more complex tax situation. We spent over four extra hours by filling out TurboTax and Ramsey’s SmartTax software.
Most people won’t fill out their tax information through multiple pieces of software to compare returns. And if you do, you may feel even more confused and just want to get them professionally done like us.
DIYing it doesn’t always save you.
Having a professional to do our taxes gave us clarity and peace of mind. The stakes are high if you get your taxes wrong.
Are you surprised by our tax experiment results?
What did you use to do your taxes?
Did you hire a professional?
If you’re ready to get intentional with your financial life, money coaching is for you. We won’t do your taxes, sell you insurance or financial products, or invest your money. We will help you get your financial life in order, take action, reduce your financial stress, and help you get unstuck.
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