--- title: Doing Your Taxes Online? The Price Is About to Go Up description: And nobody knows exactly when. authors: - name: Julia Glum role: Managing Editor url: https://money.com/author/julia-glum/ bio: A graduate of the University of Florida, Julia has more than eight years of experience in personal finance journalism. In addition to overseeing news and newsletters, she leads Money’s tax coverage, which includes extensive reporting on tax credits, policy changes and the IRS. education: University of Florida at_money_since: 2018 articles: 453 covers: - Taxes - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping - Technology also_seen_in: - Newsweek - International Business Times - CBS News - Good Morning America - WUSA9 - Pix 11 - The New York Times - Mashable - The Washington Post - CNBC - Politico social: - https://x.com/superjulia - https://www.linkedin.com/in/julia-glum published: '2020-02-13T18:30:59.000Z' modified: '2024-01-10T15:29:09.000Z' section: Taxes tags: - apex25 - income taxes - News word_count: 1357 canonical: https://money.com/tax-prep-fees-increase/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![200213-Online-Tax-Preparers](https://img.money.com/2020/02/online-tax-preparer_f.gif) Attention, procrastinators: If you put off filing your taxes, you're probably going to pay more. At some point before April 15, judging from the crossed-out costs on TurboTax's [Products & Pricing](https://turbotax.intuit.com/personal-taxes/online/) page, the Deluxe service will increase to $60 (up from $40), Premier will become $90 (from $70), and Self-Employed will become $120 (from $90). On top of that, each will have an additional $45 fee per state file (up from $40). The price increases are nothing new. TurboTax Online, which more than [32 million people](https://s23.q4cdn.com/935127502/files/doc_presentations/2020/02/2019-IR-Marketing-v2-Final.pdf) used to file their taxes in fiscal year 2019, has a history of hiking its fees as tax season wears on. According to social media posts, the Intuit-owned brand raised its prices after [March 19, 2015](https://twitter.com/jbensonwrites/status/576450289407930369); [March 17, 2016](https://twitter.com/selch/status/708333385047912448); [March 16, 2017](https://twitter.com/leepnet/status/840299202064277504); [February 28, 2018](https://twitter.com/TeamTurboTax/status/967864641077563392); and [February 28, 2019](https://ttlc.intuit.com/community/taxes/discussion/there-was-a-message-on-turbotax-that-said-file-by-2-28-and-save-30-does-that-mean-if-i-file-after/00/431782). TurboTax [has said](https://twitter.com/leepnet/status/840299202064277504) it's intended to "encourage early filing." But it's unclear exactly when those prices will go up in 2020. With roughly three weeks to go until March 1 — the date by which, going by previous years, fees will jump — [TurboTax](https://money.com/pr/ud31501196cb?ap_referrer=https%253A%252F%252Fmoney.com%252Ftax-prep-fees-increase%252F) hasn't put a warning on its website about them. There is a fine-print disclaimer about how "actual prices are determined at the time of print or e-file and are subject to change without notice," but there's no publicized deadline. The price hikes aren't really mentioned in the TurboTax blog post listing "[6 Reasons it Pays to File Your Taxes Early.](https://blog.turbotax.intuit.com/tax-refunds/6-reasons-it-pays-to-file-your-taxes-early-19100/?cid=soc_tw_o_education_20200108_sf227724761&sf227724761=1)" And this practice isn't even abnormal for the industry, which experts say raises consumer protection issues. "Honestly, there's zero transparency with respect to tax prep fees," says Pippa Browde, a federal tax law professor at the University of Montana. "They can do what they want." ## Think Early Bird Special, But for Taxes Offering lower prices for early filers is a common business move, not unlike [Uber's surge pricing](https://www.bloomberg.com/news/articles/2016-03-08/surge-pricing-on-your-tax-return-preparers-squeeze-procrastinators) or airlines that change fares based on [browser history](https://millionmilesecrets.com/guides/are-airlines-raising-your-ticket-price-based-on-browser-history/). It's a way to lock in repeat customers earlier and attract new ones with flashy discounts, according to Lopo Rego, an associate professor of marketing at Indiana University. From an operational perspective, Rego says it's likely in TurboTax's best interest to distribute web activity evenly over time. It may be a resources issue, where it doesn't want millions of people crashing its servers at the last minute, or a staffing concern, where it needs to lessen the burden on the live accountants it hires for support. He compares it to the early bird special at a restaurant. "By giving you an incentive to come in sooner, they're better managing their demand," he says. "People who are more price sensitive will go and have dinner at 5 p.m., and that frees up tables at 7 or 8 p.m." But a restaurant usually advertises when its specials end. A coupon in the Sunday newspaper typically has a printed expiration date. Tax sites are not quite so up front about the timing of their price increases. (A TurboTax spokeswoman says customers get advance notice of price changes via email, on the homepage and in other interactions with the brand.) "Under current law, tax return preparers and the tax return preparation software industry endure little regulatory oversight," tax scholars Jay A. Soled and Kathleen DeLaney Thomas wrote in a 2017 [paper](https://scholarship.law.unc.edu/cgi/viewcontent.cgi?article=1299&context=faculty_publications). "Members of both groups may essentially render their services or produce their products in any manner they please." So they do. ## A Standard With No Schedule TurboTax isn't the only online tax preparer that raises its fees over time. H&R Block, which prepared more than 23 million tax returns in fiscal year [2019](https://www.hrblock.com/tax-center/newsroom/around-block/financial-statements/fiscal-2020-second-quarter-results/), has a [page](https://www.hrblock.com/online-tax-filing/) displaying crossed-out prices for its online Deluxe, Premium and Self-Employed services. As of Feb. 13, Deluxe cost $29.99 (discounted from $49.99), Premium cost $49.99 (from $69.99) and Self-Employed cost $79.99 (from $104.99). Each had an additional $36.99 fee per state filed. Like TurboTax, H&R Block acknowledges that prices are "ultimately determined at the time of print or e-file" and "subject to change without notice." "H&R Block provides an extra benefit in the form of discounted prices to consumers who file their taxes online early," spokeswoman Susan Waldron tells Money, adding the company typically emails customers about a week ahead of changes. TaxAct has similar procedures. As of Feb. 13, [TaxAct's paid online programs](https://money.com/pr/u7aacdbb6ccb?ap_referrer=https%253A%252F%252Fmoney.com%252Ftax-prep-fees-increase%252F) included Deluxe+ for $23.96 (down from $29.95), Premier+ for $31.96 (down from $39.95) and Self-Employed+ for $59.96 (down from $74.95). Each had an additional fee, ranging between $31.96 and $39.96, per state filed. Amy Roepke, a spokeswoman for TaxAct, says it's a standard industry practice to increase fees over time. She says TaxAct prices "likely will increase once or twice as we near the filing deadline," but "there is no set schedule at this time to share." When TaxAct knows a price hike is coming, she says it often puts a banner alert on its homepage a week in advance. She adds that TaxAct consistently messages users to encourage to file [sooner rather than later](https://money.com/best-time-to-do-taxes/), which can be especially useful for people who are anticipating refunds or are concerned about tax fraud. "There are a variety of reasons filing early is beneficial to a customer, and paying a lower price is one of them," Roepke says. ## 'They Need to Make Money to Survive' It's not only laziness — some people have legitimate excuses for delaying their taxes. While Form W-2s usually go out by the end of January, other documents take time. For example, people in limited partnerships must [wait](https://thecollegeinvestor.com/15233/what-to-do-if-youre-waiting-for-tax-forms/#tab-con-2) until the firm does its own taxes to get their Schedule K-1s. But that deadline isn't until mid-March, meaning taxpayers are often left hanging for weeks. Some tax preparers offer loopholes for customers in these situations. TaxAct used to have a guarantee where customers could lock in the lowest possible price even if they hadn't finished their taxes yet (it has since been eliminated). TurboTax has also previously [allowed](https://ttlc.intuit.com/community/taxes/discussion/yes-you-can-prepay-at-any-time-by-following-the-steps-be/01/155387) people to prepay, taking advantage of promotional prices and then actually filing later on. "This is a business, and they need to make money to survive," says Browde, the University of Montana professor. As she points out, one goal of virtual tax preparers is to produce returns that don't get audited, so they tend to be conservative in their interpretations of tax law. That means customers could be at risk of overpaying anyway — which, to some, might be worth it to not have to deal with the IRS. Still, the tax prep industry is far from perfect. A recent [government audit](https://www.treasury.gov/tigta/auditreports/2020reports/202040009_oa_highlights.html) [found](https://www.propublica.org/article/turbotax-and-others-charged-at-least-14-million-americans-for-tax-prep-that-should-have-been-free-audit-finds) that software companies charged over 14 million people for tax prep last year when they could have had it free of charge. H&R Block and Intuit have [repeatedly](https://www.vox.com/2016/3/29/11320386/turbotax-boycott-lobbying-tax-filing-season-tax-day-april-15) [lobbied](https://www.propublica.org/article/filing-taxes-could-be-free-simple-hr-block-intuit-lobbying-against-it) against automatic tax filing, while Democratic senators [have](https://www.washingtonpost.com/politics/2019/04/17/tax-preparation-services-hit-low-income-filers-with-added-fees/) [criticized](https://www.washingtonpost.com/politics/2019/04/17/tax-preparation-services-hit-low-income-filers-with-added-fees/) tax products that unfairly burden low-income customers. ## How to Score Discounts Anyway The lesson? If you want to avoid surprise fee hikes, file early. Or at least buy the services you need before you actually need them, which is what Indiana University's Rego does. Otherwise, be aware that prices will fluctuate for online tax prep — and realize it's not a shady policy so much as a marketing tool. It's just business. Not only do huge portions of the country's 150 million-plus tax filers file [around](https://www.irs.gov/newsroom/with-tax-filing-deadline-nearing-irs-says-about-50-million-still-need-to-file) April 15, but Rego says they also care less about price the closer it gets to that date. Companies know that as the urgency increases, so too does a person's willingness to pay whatever it takes to get their taxes done. "If it's April 14 and I have not filed my taxes, and I go on to TurboTax's website ... I may not even be aware that the discount existed. But more important, I don't care," he says. "At that point, I need to file my taxes. The last thing I'm going to be thinking is, 'I've heard there was a $20 discount.'" *This story has been updated to include a comment from TurboTax.* ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/tax-prep-fees-increase/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Taxes", "item": "https://money.com/taxes/" }, { "@type": "ListItem", "position": 3, "name": "Tax Preparation", "item": "https://money.com/tax-preparation/" }, { "@type": "ListItem", "position": 4, "name": "Doing Your Taxes Online? 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