Credit Karma Tax e-Filing | Review

Credit Karma Tax e-Filing | Review

On 7th December 2016, Credit Karma, a personal finance company, introduced Credit Karma Tax. It is a self directory tax preparation software.


It provides free state and federal tax preparation, along with free e-filings, only for it’s members. The CEO claimed that the company will make financial progress devoid of any hidden fees, trial periods or ploy. The tagline reads: $0 Federal, $0 State, $0 Always.

Truly Free Tax Returns’. So as there is nothing as good as free, let us have a look at this new introduction by Credit Karma.

Read Credit Karma Full Review… 

Is It Really Free ?

When a tax software company advertises something as free, it doesn’t really mean free. Credit Karma Tax is no different.

When you do your tax preparation in the software, you feed the software with your own information. The company uses this information to make their credit card offering system better. And if you happen to register for a credit card from the company, they get a commission. The company also uses the information to show you targeted advertisements based on your choices and gets paid in commission.

In a more layman view, the company acts more like Google and Facebook, where one uses the company’s free softwares while feeding them with information. This information is later used by the companies to target advertisements at them.

Credit Karma Tax Preparation Procedure :

One who is a present member of Credit Karma will be allowed to port his data to the workstation provided by the software. Though one cannot port the previous year’s tax return. That is a problem for business holders who need to frequently compare data across the years like real estate investors.

While other softwares in the block though not free are providing the feature for easy data shifting across platforms.Credit Karma Tax lags behind in this regard. After the completion of the personal information round comes a choice between interview style and self guided filling.

The interview style seems apt for starters and experienced veterans both. This mode guides one through many questions and at any point the view can be altered to “Tax Form View”. The other option on the other hand lets one navigate to relevant sections.

Though Credit Karma Tax features an easy-to-use software, it has some drawbacks. It is devoid of any import options, which leads to user error. Thus stock market traders, small business owners and real estate investors need to weigh out their depreciation and defrayal schedules.

Free Credit Karma Tax e-Filing….Seems Confusing ?

If filing your taxes with the software gets you perplexed, here are a few tips you can use :

  • The gray questions marks explain difficult terminology. While for more serious questions one has to refer to the company’s website which in itself is quite tedious.
  • The website contains some helpful articles under the subheading “Tax Help Center”.

Now that we know quite a bit about the software, let us discuss where the software outclassed everyone and where it could have done better.


  • The software features a very easy to use platform allowing more and more people to access the software.
  • The software has no up-sells, no upgrades and no premium version. Thus it is a software with no inside purchases.
  • Free Federal and State filing with free e file of 90% of fliers with no income restrictions.
  • Helpful for amateurs and experienced fliers to file for tax preparation.

Now it is important to note the limitations of the free do-it-yourself-software.


  • Sells information gathered to other companies that leads to targeted advertisements and is thus not completely free as it claims to be.
  • Devoid of an import option.

The software does not sync in with the following:

  • Those registrations by state devoid of a federal return
  • Foreign revenue income credit.
  • Married couples registering differently in common law states.
  • Property and Bonds income for K1 form.
  • Independent revenue income credit
  • Registering for numerous state or non-resident state returns
  • Non-resident federal filing – 1040NR

Credit Karma Tax  – Bottom Line

The deal is as simple as clear water. However, the Credit Karma Tax software is not apt for every situation.  As small time business owners and investors in various fields will need to invest in softwares like TurboTax if not well versed with tax laws.

And even the frequent traders might find the interface a bit clumsy to deal with. Apart from them a majority of the crowd should find this software immensely helpful.

So, if you don’t mind the company showing you advertisements using your information, it will give you free state and federal tax return. Whereas choosing TurboTax or H&Q Block can cost you around hundred dollars.

It’s advisable for people having a complicated tax return to invest a bit extra elsewhere for the services they will miss here.

What do you think about Credit Karma Tax e-filing?  Share your thoughts /comments down below!

Please follow and like us:

2 thoughts on “Credit Karma Tax e-Filing | Review

  1. credit karma is the bomb. I actually use it all the time. Now I have never done it for taxes, but now I know how. I havint done mine yet, but now I want to with this. Thanks so much, and excellent post

    1. AJ-

      Good to hear. Credit Karma tax is a new line for them (started December 2016). When you use Credit Karma tax, please share your experience with us.

      Thank you and wishing you all the best!

Leave a Reply

Your email address will not be published. Required fields are marked *