Best Free Tax Software in 2025

Free tax software aids individuals and organizations in the preparation and filing of income tax returns at no cost.  Given the importance of tax preparation, there are numerous applications on the market that offer tax solutions. These typically calculate tax dues, carry the latest tax forms, provide step-by-step guides to accomplishing and filing tax forms, and automate the tax preparation workflow. The best free tax filing software offer generous free plans alongside paid packages that strategically expand the apps’ competencies.

Paying taxes means giving away a portion of your income, thus businesses and individuals often ask “What tax programs are free?” Thankfully, many of the best tax filing software solutions offer free trials or free plans that let you enjoy some of their core features without cost. Based on their high product ratings in our product reviews, these platforms are the ideal choices: Zoho Books, Wave, H&R Block, FreeTaxUSA, and SimpleTax Canada. You can try any of these products and see which works best for your operations.

Free tax software platforms are generally classified based on the types of users they serve. Smaller-scale apps are reserved for individual users while the more comprehensive ones are for business users. The following are the targeted users of free tax software.

• Proprietors and Freelancers looking for a simpler way to accomplish their taxes. Accomplishing taxes can be a tedious process for microbusiness owners and freelancers, given that smaller-scale operations don’t always have dedicated staff to handle taxation. Free tax filing software solutions for individuals, which come as physical box retail software and SaaS platforms, impart convenience since these streamline taxation workflows and make the process of filing taxes easy.
• Small Businesses, Mid-sized Firms, and Large Enterprises aiming to manage their taxes better. Organizations of all scales are busy dealing with numerous transactions daily while ensuring that their operations are running smoothly. With free tax software, they get to accomplish their taxes painlessly, as they obtain, fill up and submit their tax forms with just a few clicks and key presses. In addition, these systems guarantee tax compliance.

• Zoho Books: An intuitive accounting solution with a comprehensive tax module that helps businesses of all scales accomplish their tax duties while streamlining their accounting workflows. Users can receive payments, send invoices, compute their taxes, and obtain and submit tax forms with the platform.
• Wave: An integrated accounting system equipped with taxation, invoicing, and payroll features. The platform helps users compute their taxes and tax deductions, manage their tax forms, keep track of their financials, and ensure that their cash flow is in order.
• H&R Block: A dynamic tax platform that enables users to file their taxes with ease. It affords users access to tax tools and calculators, carries a repository of tax information, and holds various tax forms and preparation checklists. The system also provides tax tips to professionals who are new to taxation.
• FreeTaxUSA: A feature-rich tax preparation system known for its generous free plans and offering solutions to various tax situations. It provides tax calculators to go along with functionalities for preparing taxes and tax extensions, auditing tax returns, and securing financial information.
• SimpleTax Canada: A robust tax preparation tool that offers solutions exclusive to Canadian territories. The system is built with a library of certified tax forms, a feature for managing tax refunds, an auto-fill functionality for tax forms, and solutions for simple and complex tax scenarios.

Free tax filing software tools are generally classified into two categories. These are based on the types of users to whom these platforms’ functionalities are tailored.

• Free Personal Tax Filing Software. These platforms help freelancers and sole proprietors obtain, accomplish, and submit tax forms. In addition, the systems have calculators and compliance solutions to ensure that all submitted forms are accurate and within the bounds of the law.
• Free Business Tax Filing Software. These systems offer comprehensive solutions for a range of tax situations. Their typical functionalities include a tax form library, a knowledge base on tax information, tax forms with an auto-fill functionality, calculators, and sometimes automated workflows.

The core features of free tax software are often similar, regardless if they come as standalone systems or modules of bigger platforms like accounting systems or ERP software. These functionalities are designed to simplify the taxation process by optimizing tax-related workflows, ensuring compliance, and making tax calculations easy.

• Tax Calculator. Tax calculators help individuals and businesses compute different types of taxes. Some free tax software in 2022 leverage AI to automate calculations based on the percentages of each tax type.
• Digital Tax Forms. Free tax filing software tools offer digital versions of various tax forms. This eliminates the need to travel to tax offices just to obtain forms. Some platforms have an auto-fill feature based on previously entered information to minimize errors and speed up the process of accomplishing forms.
• Electronic Filing. Accomplished forms can be filed within a platform’s interface, eliminating the need to mail or visit tax offices. The IRS prefers this filing method since it’s secure, typically has fewer errors, and is easier to process.
• Data Storage. Many free tax systems provide ample storage space for users to comfortably store pertinent documents like accomplished forms and tax returns. This enables users to accomplish all tax-based activities within the interface.
• Diagnostics and Compliance. Tax policies tend to have varying requirements, which can confuse taxpayers. As such, the best tax filing software systems list these down per tax type and check if you have entered the right information. Some platforms automatically detect errors and notify users to supply the correct information.
• Tax Information Knowledge Base. Not everyone is knowledgeable about tax policies, especially those who recently ventured into business. With this, the best free tax software systems maintain a library of information that users can browse to know more about tax forms, the different types of tax, and how the software’s features work.

Remote Tax Filing

Free tax software enables users to file their taxes on their desktops or mobile devices at any place that has an internet connection, whether it’s at home, in the office, or at a vacation spot. Likewise, tax refunds can be obtained remotely.

Calculates Tax Deductions

Tax policies tend to add new deductions or change every once in a while. Tax platforms account for these changes in their computations. Users are advised to update their software regularly so that the tax policies covered are always up to date.

Stores Tax Information

Free tax filing software systems record and store the tax details of users. This simplifies and speeds up the process of filing taxes in the long run since the data is applied to various tax forms.

Automatically Audits Information

Many tax systems automatically spot errors in entered information and inform users that certain entries have to be adjusted. This reduces the occurrence of errors in accomplished forms, enabling users to avoid IRS audits.

Provides Tax Information

Businesses have to hurdle different types of taxes, some of which may be unfamiliar to entrepreneurs. As such, many tax systems have a library of articles that contain information on various taxes along with their respective deductions. The knowledge base also contains information on how the features of the tax app work.

More Efficient Taxation

Tax apps enable users to file taxes, audit tax forms, ensure compliance, and learn more about taxes within the interface. These also integrate with related platforms to painlessly pull financial information. This speeds up the entire taxation process and reduces the likelihood of errors.

Costless Tax Filing

Some of the leading tax filing platforms on the market offer generous free plans that carry the system’s core features. In using one, businesses won’t need to deal with pricey monthly or annual subscription fees while enjoying a more convenient and efficient taxation process.

Incorporation of Optical Character Recognition

Some forms are marked with terrible penmanship and migrating these to a tax platform can pose a challenge. It’s logical for tax systems to incorporate optical character recognition solutions to scan handwritten entries and turn them into readable text. This saves time, reduces errors, and expands the capabilities of tax software.

High Demand for Cloud Platforms

Cloud platforms are gaining traction in the global market. In 2020, 82% of small businesses and 52% of enterprises used cloud accounting software. These percentages would have likely increased this year, given that more firms have completed or advanced their digital transformations. Tax software is part of this trend as more and more people prefer to transact online.

Integration with Accounting Platforms

Taxes are part of business finance and is reflected in accounting books. And so, some tax platforms come as modules of or integrate with accounting software. As a result, data siloes are eliminated, the entire accounting process is streamlined, and business users can manage their finances more painlessly.

Software Glitches

Some free tax preparation software systems are plagued with glitches that kick users off and cause problems with the functionalities. There are even bugs known to haunt the Help section. Should you encounter a glitch, contact the software provider’s technical support team.

Limited Tax Determination

Some tax platforms, instead of performing taxability determinations, simply supply categories from which users characterize the goods they sell. Misinterpretations or entering items in wrong categories lead to costly errors. In addition, users will have to perform due diligence in settling their tax dues.

Limited Knowledge Base

While tax platforms often have knowledge bases, not all Help sections have the answers to every pertinent tax question for liability reasons. As such, users will have to research taxes or seek legal assistance from professionals. The process can be costly and time-consuming.

• The global tax software market is valued at $13.64 billion.
• In the United States, there are 137,371 businesses in the tax preparation services sector.
• The global tax software market is set to grow by 8.34% annually from 2022 to 2027.
• There are 268,967 employees in the tax preparation services sector in the United States.
• According to the IRS, there were an estimated 151,448,000 tax returns e-filed.

File taxes early

It is not advisable to file taxes at the last minute, even when using free tax software 2022 guides indicate. Do it at least a week before the deadline so you would have ample time to spot errors and perform corrective action, which prevents an IRS audit. You can also file for an extension as needed, although some states require a portion of the balance to be paid prior to its approval.

Routinely update your security software

Cybersecurity is a high priority for taxpayers since a data breach can literally cost millions to resolve. As such, tax preparers are required to note their security plan in regard to safeguarding client data. Often included in the plan are security features like password protection, data encryption, and secure FTP, which come with the best tax filing software.

Paper is still relevant

Some returns require the use of paper for filing, so having paper in the office is advisable. Filing paper-based returns takes longer than e-filed ones. This means businesses and individuals should file their taxes early to avoid penalties and other concerns in the long run.