Credit Karma: Free Tax Returns (New Features For 2020)

2020 update:

  • Max refund guarantee has been increased to a maximum of $100. There is now a $25 minimum
  • Free audit defense. More details on this can be found here.

December 2017 Update: Credit Karma has added a number of new features:

  • Click and fill: You can import Form W-2 from supporter major payroll providers or a mobile device
  • Easy Switch: If you used H&R Block, TurboTax or TaxAct last year you can import your past return data automatically
  • Mobile filing: You can fill out portions of your return on a mobile device and then complete it when you’re back at a computer (or vice versa)
  • Max Refund guarantee: $25 gift card if you receive a higher return from another tax preparation software when using the same tax return information.

Original post: In December 2016 Credit Karma that they would be offering free tax returns for their users. Credit Karma is most known as a free credit monitoring tool (and one of the websites we recommend using to monitor your credit for free). Given the fact that free credit monitoring and free FICO scores are becoming more common place, Credit Karma has been looking to expand their offerings and the latest is this free tax return offer.

credit karma tax

The service is completely free & no credit card is required (they make their money by marketing to you, if you’re a regular Doctor of Credit reader then you should be able to spot the bad deals). They are providing free tax returns for both federal & state taxes. You can view a list of supported forms here. I personally pay an accountant to handle my taxes for me, so I can’t really comment on how useful their offering is. If anybody has used it, or plans to use it I’d love to hear your thoughts in the comments below. Also feel free to share other options out there.

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Ryan Goldstein

I haven’t been able to use Credit Karma to file my taxes, since they have never supported Form 1116, which is required if you’ve paid more than $300 in foreign taxes (filing single). I really wish they’d add support for that form. Every other tax filing solution that I know of supports it.

TDD
TDD

Just used CreditKarma to file my taxes. Super easy. Just needed to navigate how to allocate some income, but it worked. Only weird thing is how they report some numbers on the summary pages. For example, if you have stock losses but have some DIV interest as part of your investments, the summary page will show the losses less the DIV interest (e.g. 3000 loss, 100 in DIV interest, itll show your losses as 2900 instead of 3000). It is just something weird about how they show things, but when you load up your preview tax forms it will show correctly. Some things aren’t as simple to figure out as TurboTax makes it, but if you take a few moments and learn how to file, you’ll get it.

Jake N
Jake N

I couldn’t get CK to verify my phone (on Google Voice) so I am going to try FreeTaxUSA. They are also available for up to 50% cash back on TCB and others.

https://www.cashbackmonitor.com/cashback-store/freetaxusa.com/

SamL
SamL

Yeah, I switched to FreeTaxUSA when TaxACT went totally nuts with price increases.

JAAS
JAAS

can the TaxACT last year’s data be imported to FreeTaxUSA?

JAAS
JAAS

can the TaxACT last year’s data be imported to FreeTaxUSA?

Paul S.
Paul S.

I tried CK for the first time.
30 minutes in I couldn’t find a way to import my 1099-B.
I’m not going to input hundreds of trades individually
Oh well, I guess it’s back to TurboTax

Kapil
Kapil

you can entry in summary form

Mike
Mike

Can Credit Karma handle HSAs in CA yet? That’s why I haven’t used them, besides the turn off of the privacy issues, they were unable to do my return.

Victor
Victor

What do you mean by whether they can “handle” HSAs in CA? As far as I can tell, they’re doing it right.

SamL
SamL

Perhaps you are not aware that CA (like a couple of other states) does not recognize the tax-sheltered status of HSAs, making the reporting situation significantly more complex. CK could put this in the too-hard basket.

jp
jp

I have an HSA and I was able to file last year. It wasn’t calculated properly the first time I entered it and I had to renter the numbers. Lucky that I had checked my tax return with a different service before ultimately using Credit Karma. There are still bugs they haven’t fixed so you have to double check before filing with them. I’m in MD BTW.

Hodor
Hodor

Hmm, I still don’t get why people are so willing to hand over their financial data to CK or other “free” services when tax software costs like $20.

Grant
Grant

The pay services also mine your information and lobby to make tax filing complex so…..

Hodor
Hodor

It’s documented that CK is using tax data to market credit products to users. The pay services I’ve used are only in the tax prep game, and they’re going to lobby whether they get my $20 or not. In any event, calling CK “free” is naive.

0x539
0x539

And how exactly does CreditKarma using this data to market credit cards to you cost you anything? They only make money if you use their link to apply, which still doesn’t cost you anything. CreditKarma is owed by TurboTax, btw, so they’re getting your data regardless.

Bison Bob
Bison Bob

Tax software doesn’t cost $20. For example, I’m self-employed. Here’s what I’d pay for three popular tax prep software choices:

TurboTax: $150

Tax Act: $74.95

TaxSlayer: $47

And most services charge an additional fee for state returns. Further, you’re handing over your financial data, regardless of which online service you use.

Kapil
Kapil

So the paid services don’t use your information?

Superman
Superman

Free CK Tax is a $4 moneymaker, best was $6. https://www.doctorofcredit.com/topcashback-get-6-cashback-with-free-credit-karma-tax-filing/
A few reasons I’d try them again:
• CK included my state filing vs. $40 more at HR, TT, TA.
• CK included my Schedule SE filing vs. $60 more at HR, TT, TA.
• CK included my Schedule D filing vs. $60 more at HR, TT, TA.
However, CK needed improvement:
• Importing past return data from HR, TT, TA was useless.
• Would freeze between steps with no clarification why a form field failed (e.g., Chuck & others informed readers that penny gains/losses from Swell Invest might be reportable, CK’s software could do automatic rounding for amounts >$1 but needed manual rounding for amounts <$1 and without that simple explanation you're stuck on that page for hours).
• Schedule C-EZ (8 lines) should be made available, completed unnecessary, time-wasting, 40 extra steps to complete Schedule C (48 lines).
• Should have checkboxes or direct input to enter business code, dropdown submenus were not searchable.

anonymous
anonymous

I’ll stick with OpenTaxSolver. 🙂
Why let myself be commoditized?

Superman
Superman

My services are up for sale to the highest bidder and using CK’s tax software last year paid out $6! Others want you to use theirs for free or to pay them $$.

anonymous
anonymous

Can you rephrase that? I don’t follow your train of thought.

Chris
Chris

They were spot on with Turbotax this year on my relatively simple return. My only complaint is CK made it exceedingly difficult to find and enter itemized deductions. Knowing I was getting the standard deduction anyways per TT, I didn’t bother hunting the website for long.

Hari
Hari

No love for Minnesota

JT
JT

Can I use credit karma tax in Minnesota?

Hari
Hari

Does not support Minnesota State as per the website. So probably we are limited to only Federal.