Credit Karma Tax vs H&R Block: Here's how the tax filing services compare on price, ease of use, and refunds

• This year I prepared my tax return on both Credit Karma Tax and H&R Block.
• I wanted to save money on preparation fees, get my maximum refund, and move through the process quickly and easily.
• Even though Credit Karma Tax is completely free, I chose to pay for H&R Block's Deluxe Online version.
• H&R Block enabled me to upload my W-2 for easy data input and got me about $200 more for my state tax refund than Credit Karma Tax.
• Check out Business Insider's picks for the best tax software »

Many people don't realize it's completely free to file your federal tax return with the IRS if you go the pen-and-paper route.

When you pay a company like TurboTax or H&R Block, you're covering the preparation fees. And it's usually worth paying for the extra help, since most of us aren't fluent in tax law.

But if your situation is simple enough, you shouldn't have to spend a dime. H&R Block and TurboTax both offer free versions and Credit Karma Tax is completely free. But they're not all created equal.

I've used H&R Block for the past few years and had a positive experience. This year, however, I knew I wouldn't qualify for free filing, so I tried out Credit Karma Tax to see if it was worth jumping ship.

Here's how they stack up.

Credit Karma Tax vs. H&R Block: pricing

Credit Karma Tax is completely free for both federal returns and state returns and supports most tax situations; you just need a Credit Karma account to start. What it doesn't cover, however, could be a deal breaker for some people, including disallowing returns for people who earned income in a state they don't reside in and part-year state returns.

H&R Block is a part of the IRS Free File program, allowing taxpayers with an adjusted gross income (AGI) under $69,000 to prepare and file their returns for free, regardless of the additional forms and schedules needed.

If you earned more than the Free File limit in 2019, you can still get free return prep through H&R Block. This version supports W-2 income, interest income, dividend income, retirement distributions, the student loan interest deduction, and the Earned Income Tax Credit.

If you want to itemize deductions, have a Health Savings Account (HSA), own a home, or earn self-employed income, you'll need to upgrade to one of H&R Block's paid products.

• Deluxe Online: $50 (currently on sale for $30). Everything the free version includes, plus the mortgage interest deduction and Health Savings Accounts (Form 1099-SA), and you can itemize.
• Premium Online: $70 (currently on sale for $50). Supports everything in the Deluxe version, plus rental property income and freelance/contractor income below $5,000. You can also import mileage and other expenses from common tracking apps.
• Self-Employed Online: $105 (currently on sale for $80). This is the highest-tier online package offered by H&R Block. It's ideal for self-employed people, including small business owners, partners, and contractors who earned more than $5,000.

Winner: Credit Karma Tax

Credit Karma Tax vs. H&R Block: ease of use

The W-2 upload option saves a ton of time on data entry

Businesses are required to mail your tax forms to you by late January, so you should have everything you need to file by now, including your W-2 or 1099, and any bank statements reporting dividend or interest earnings. If you're enrolled in electronic statements for your payroll provider or bank, the tax documents should be available in your online account for download.

If you have digital forms, H&R Block makes it really easy to input the data on your income form to save time. You can either upload the PDF file or import it directly from your payroll provider. Either option takes just a few seconds. I usually double-check all the numbers to make sure everything is correct and I have yet to find an error.

Credit Karma Tax also advertises W-2 upload capabilities, but the tool didn't work for me. I tried it at least three times before giving up and entering everything manually.

And though it's more of a quirk than a deal breaker, Credit Karma Tax asked me to choose from a list of occupations at the beginning of my return but didn't provide an option that even closely matched my actual job - a journalist. No "reporter," no "writer" ... not even "media." I wound up selecting "communication."

The instructions were clearer on H&R Block

On Credit Karma Tax, I had trouble figuring out where to enter my California State Disability taxes because some of the instructions were contradictory. I emailed Credit Karma's support team for help and still hadn't heard back after a few days.

Other than that, Credit Karma offered helpful instructions along the way, but I ultimately preferred H&R Block's easy-to-understand explainers. H&R Block made it perfectly clear in layman's terms what I would see on my W-2 and what I would need to enter, and where, on its form.

In my opinion, H&R Block excels at step-by-step guidance, which makes it a great choice for first-time filers or anyone who wants to be fully informed on their tax situation. If you're confused at any point and want further explanation for any form, you can search for more answers in a side-bar without leaving the page you're on. I used this tool liberally and found every answer I was looking for.

Winner: H&R Block

Credit Karma Tax vs. H&R Block: refunds

Even though I set out to get my smallest refund ever this year by matching my withholdings to my tax liability, I still want to make sure I'm getting back every dollar I'm owed.

Credit Karma Tax and H&R Block calculated the same federal refund for me, but the state tax refunds looked quite different. Credit Karma Tax calculated a state refund that was about $200 less than H&R Block. Maybe it had something to do with the previous issue regarding state disability taxes, but Credit Karma Tax never flagged an error in my data entry.

Considering my refund amounts, even with the fee I would be paying H&R Block for the Deluxe Online package - a total of $67 for my federal and state returns - I'd still wind up with more money in my pocket than if I went with Credit Karma Tax's free service.

Winner: H&R Block

Credit Karma Tax vs. H&R Block: Which is better for free filing?

If you're unsure whether you'll get more bang for your buck with H&R Block or Credit Karma, I recommend running your taxes through both services to see which results in a larger refund. If your situation is like mine, it's probably worth paying the fee.

Learn more about Credit Karma Tax »

Learn more about H&R Block »

• More tax day coverage:
• When are taxes due?
• How to file taxes for 2019
• Should I do my own taxes?
• Credit Karma vs. TurboTax
• Where is my tax refund?

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