The eSmart Tax Difference

IRS Tax Form-based eSmart vs. Tax Interview Software

Though all IRS authorized tax software needs to be tested by the IRS, not all are created equal.

The IRS publishes tax Forms 1040, 1040A, and 1040EZ to guide taxpayers through the tax return preparation process. Depending on individual situations, taxpayers use additional forms and Schedules (A, B, C, D, etc.) to compute or report additional information. This information is then added into a Form 1040 to complete the tax return. The basic concept of a 1040 tax return is actually very simple:

1. Income - You add up all of the income you collected for the year
2. Deduction - Deduct the items and amounts allowed under the law from your total income to arrive at taxable income.
3. Tax and Credit - Based on your filing status and the tax table, your tax liability is calculated. Next you check to see if you qualify for the tax credits on the 1040 form and adjust your tax return accordingly.
4. Other taxes - Self-employment, household employment taxes, etc.
5. Payment - Depending on how much tax you have already paid, you will either get a tax refund (90% of taxpayers do) or have to pay additional taxes.

Traditionally, many personal tax software applications use an interview approach to tax return preparation. A user responds to many questions, one at a time, while the software collects the data, performs computation and completes the tax return. With multiple questions and tax logics, the software tries to be idiot proof and guide the user by the hand to a completed return.

eSmart Tax online software started with a totally different approach and is a smart extension of the IRS tax forms. eSmart Tax software follows the logical steps of the 1040 form and guides you through each line of the tax form based on the instructions from the IRS. The software performs all computations and consistency checks the information. It is like a mirror image of the IRS tax form except the software has built-in tax logics and automatic computations. You know exactly where you are in the preparation process and the impact of all data you have entered. It is clear, concise and quick. Instead of going through hundreds of questions, you go through less than half of the number of web pages to complete your return.

No single tax software is perfect for all taxpayers. Different users at different times may prefer different approaches. If you have not used eSmart Tax before, we encourage you to try eSmart Tax online and our unique, clear preparation process and decide for yourself if this is for you. Many users enjoyed the preparation process because they felt in control and understood what they did.