How to use Credit Karma Tax®

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In a Nutshell

Every year, millions of Americans pay to have their taxes prepared, either by a professional or with DIY tax software they purchased. But you don’t have to be among the taxpayers who will shell out hundreds of dollars to have someone else do your taxes. Here’s how to use Credit Karma Tax® to take your federal and state tax returns to the next level.

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This article was fact-checked by our editors and reviewed by Christina Taylor, MBA, senior manager of tax operations for Credit Karma Tax®. It has been updated for the 2019 tax year.

When you already have to pay taxes to Uncle Sam, you probably don’t relish the idea of also paying to do your taxes.

Yet millions of people pay for tax preparation every year.

Maybe you started out doing your own taxes when they were simple — a standard deduction, one W-2 and the now-defunct 1040EZ and you were done. But if your taxes have become more complex, you might be thinking it’s time to start paying to have them done. Or you may think you have to pay for tax software that will help you do your own taxes.

Not necessarily. You may still be able to use a free online tax preparation service to file your state and federal income taxes, while saving yourself some money. For example, Credit Karma Tax® supports most of the popular IRS tax filing forms, so most people should be able to use it to file their taxes.

Having grown-up taxes doesn’t mean you have to start paying to file your tax returns. Here’s how  to use Credit Karma Tax to take your federal and state tax returns to the next level — for free.

1. The new 1040

The 1040A and 1040EZ are gone, but the new, shorter 1040 isn’t necessarily easier for everyone.  The single-sheet 1040 also comes with a number of new 1040 schedules that many people may need to attach to their return. Some lines from the old 1040 forms have been moved off the new one and onto the separate schedules, which now contain information about common items like student loan interest deduction, self-employment tax, education credits and estimated tax payments.

Even seasoned taxpayers might find the new schedules confusing. Credit Karma Tax® can help you complete common forms and schedules — free of charge. In fact, Credit Karma Tax®, an online tax preparation and filing service supports five of the new 1040 schedules. Other DIY tax software companies may charge for these schedules.

2. Compare standard deduction to itemizing

You may already understand how to use Credit Karma Tax to file when you’re taking the standard deduction. But as your income grows and your financial life matures, you may find the standard deduction no longer gives you the maximum tax benefit.

When you’re ready to itemize, Credit Karma can walk you through the deductions that might be available to you. Plus, the tax service can help you compare what your tax outcome would be using either the standard deduction or itemizing, so you can choose the option that benefits you most. Some free tax software may not allow you to itemize deductions for free.

If your itemized deductions for the tax year exceed your standard deduction, you could get more tax benefit from itemizing and should consider filing an itemized return.

3. You don’t have to reinvent the wheel

Most people’s tax situations change gradually over time, which could mean a lot of the information from last year’s tax return will apply to your current-year taxes, too.

Credit Karma Tax can import your prior year 1040 and pull your personal data and adjusted gross income from the federal tax form. You won’t need to re-key this information if you filed with Credit Karma Tax, H&R Block, TurboTax or TaxAct last year.

4. Take control of your taxes

Let’s have a moment of brutal honesty — the first time you filed your taxes, your parents (or their accountant) did it for you, didn’t they? But if the Great Recession taught Americans anything, it’s that being tuned into your personal finances — including your taxes — is crucial.

Your taxes are an important aspect of your overall financial well-being. By doing your own taxes, you can have a more accurate picture of your financial status. Plus, you will be taking control of your own tax destiny.

When you learn how to use Credit Karma Tax, the online tax-preparation and -filing service can help you take control by guiding you step-by-step through the process of filing your federal and state income tax returns.

5. Free to start? How about free all the time?

You have plenty of options for e-filing your taxes for free, including other online services. Many allow you to start the process for free, but may ask you to pay if your tax situation turns out to be more complicated than expected. Or, some will allow you to file your federal income tax return for free and then charge you for your state return. It can be difficult to know upfront just how much federal and state filing may cost you.

With Credit Karma Tax, filing your federal and state returns is always free, start to finish. Plus, if you used Credit Karma Tax, TurboTax, TaxAct or H&R Block last year, you can import the information into your Credit Karma Tax return. And if you’re a Credit Karma member, you have access to free audit defense, even if you filed your return with a different tax service.

6. Mobile tax prep

If you’re pressed for time and want to do your taxes on the go, Credit Karma Tax offers mobile tax preparation for federal returns and certain state returns.

When you know how to use Credit Karma Tax’s app, you can itemize deductions and fill out your 1040 from a smartphone. The app is set up to help you prepare and file your tax forms on your mobile device, and even submit a payment, set up direct deposit for any tax refund you’re owed, or post-date a direct deposit of taxes you owe so that the IRS won’t take the money from your account until you’re ready (as long as it’s before Tax Day, of course).


Bottom line

Now that you know how to use Credit Karma Tax to take your return to the next level, don’t wait until the last minute to file your taxes. The sooner you file, the sooner you could get any refund you’re owed. Plus, since you’re using Credit Karma Tax, you can be confident you’re maximizing your refund, since the online tax preparation service is always free.


Christina Taylor is senior manager of tax operations for Credit Karma Tax®. She has more than a dozen years of experience in tax, accounting and business operations. Christina founded her own accounting consultancy and managed it for more than six years. She co-developed an online DIY tax-preparation product, serving as chief operating officer for seven years. She is the current treasurer of the National Association of Computerized Tax Processors and holds a bachelor’s in business administration/accounting from Baker College and an MBA from Meredith College. You can find her on LinkedIn.