"Sharing TurboTax with Family" can be a bit of a nuanced topic, as Intuit (the maker of TurboTax) has specific licensing rules. It's not quite like sharing a streaming service, but there are definitely ways to manage multiple family members' tax returns efficiently. Let's dive into how you can navigate this, step-by-step, with a focus on the desktop/downloadable version of TurboTax, as it offers the most flexibility for multiple returns.
How to Share TurboTax with Your Family: A Comprehensive Guide
Are you the go-to tax person in your family? Do you find yourself helping parents, siblings, or even adult children with their annual tax filings? If you're a TurboTax user, you might be wondering how to streamline this process and if you can "share" your software. The good news is, while direct "sharing" of online TurboTax accounts for separate individuals isn't allowed, the desktop/downloadable version of TurboTax provides a robust solution for preparing and e-filing multiple returns.
Step 1: Understanding TurboTax Licensing - Are You Eligible to "Share"?
Hey there, tax wizard! Before we jump into the "how-to," let's clarify what "sharing" means in the context of TurboTax. Many users mistakenly believe they can simply give their TurboTax Online login to a family member. This is generally not permitted and can overwrite existing tax returns! TurboTax Online is designed for one return per account.
The Key Differentiator: Desktop vs. Online. This is crucial.
TurboTax Online: Each individual needs their own separate TurboTax Online account and pays for their own return. While you can use the same email address for multiple accounts, each account requires a unique User ID. Trying to prepare a second return in the same online account will likely overwrite the first.
TurboTax Desktop (CD/Download): This is where the magic happens for families! A single purchase of the desktop software (e.g., TurboTax Deluxe, Premier, Home & Business) allows you to prepare and e-file up to five federal tax returns. This means you can prepare returns for yourself, your spouse (if filing separately), parents, adult children, or other eligible family members all from one installation.
For the purpose of this guide, we will focus on using the desktop/downloadable version of TurboTax, as it's the most practical and compliant way to prepare multiple family returns.
Step 2: Acquiring the Right TurboTax Desktop Version
Choosing Your Edition: TurboTax offers various desktop editions (Deluxe, Premier, Home & Business). The best one for your family will depend on the complexity of their tax situations.
TurboTax Deluxe: Good for most basic situations, including itemized deductions, student loan interest, and child tax credits.
TurboTax Premier: Ideal if anyone in your family has investments (stocks, bonds, mutual funds) or rental property income.
TurboTax Home & Business: Necessary if anyone is self-employed or has business income/expenses.
Pro-Tip: All desktop versions typically include the same forms, but higher-tiered versions offer more guidance and support for complex scenarios. You can often use a lower version even if a family member has investments, but you'll have less hand-holding.
Purchasing the Software: You can purchase the desktop version directly from the TurboTax website as a digital download, or from authorized retailers like Amazon, Costco, Walmart, etc.
Historically, TurboTax offered CD versions, but most computers no longer have disc drives. Downloads are the standard now.
Step 3: Installation and Account Linking
Install on Your Computer: Once you've purchased the downloadable version, install it on your primary computer.
License Code and Intuit Account: Starting with recent TurboTax Desktop versions (like 2023 and 2024), your license code will be linked to a single Intuit account. During installation, you'll be required to log in or create an Intuit account.
This linking helps with security and allows you to retrieve your license code if needed.
Important Note: If another family member needs to install the software on their own computer, they will need your Intuit account login information to complete the installation. While this allows installation on multiple computers (typically up to 3-5), their tax data will not be shared or visible to you through your Intuit account. Each return is saved locally on the computer it's prepared on.
Step 4: Preparing Multiple Tax Returns
This is where the flexibility of the desktop version shines.
Sub-Step 4.1: Starting a New Return
Open TurboTax Desktop: Launch the TurboTax software from your computer.
"File" Menu: Look for the "File" menu at the very top of the TurboTax window.
"New Tax Return": Click on "New Tax Return" from the "File" dropdown menu. This will open a fresh, blank return.
Do NOT Overwrite! This is critical. When starting a new return for a family member, ensure you are selecting "New Tax Return" and not opening or continuing a previous return.
Sub-Step 4.2: Entering Information for Each Family Member
Initial Setup: You'll be prompted to enter the primary taxpayer's information for the new return (Name, Social Security Number, Address, Filing Status, etc.).
Input Data: Proceed to input all relevant tax information for that family member, just as you would for your own return. This includes W-2s, 1099s, deductions, credits, etc.
Accuracy is Paramount: Double-check all entries to ensure accuracy. Mistakes can lead to delays or issues with the IRS.
Sub-Step 4.3: Saving Each Return Separately
Save Frequently: As you work on each family member's return, save frequently.
Unique File Names: When saving, it is imperative to give each return a unique and easily identifiable file name. For example:
_JohnDoe_2024_Federal.tax2024
_JaneDoe_2024_Federal.tax2024
_Parents_Smith_2024_Federal.tax2024
This prevents accidentally overwriting one return with another.
Location: By default, TurboTax saves files in a specific folder (usually in your Documents folder under "TurboTax"). You can choose to save them elsewhere, but remember where you put them!
Backup: It's highly recommended to save a copy of each completed tax file (the .tax2024 file) and a PDF version of the return to an external hard drive or cloud storage. This provides a backup in case of computer issues and allows easy access to the return later without needing the TurboTax software installed.
Step 5: Handling State Returns
State Program Included (Often One): Most TurboTax Desktop versions include one free state program download. This means if all family members reside in the same state, you can prepare their state returns using that single state program.
Multiple States/Separate State Programs: If family members reside in different states, you will likely need to purchase additional state programs within TurboTax for each distinct state.
For example, if you're in New York and your child is in California for college, you'd need the New York state program and also purchase the California state program.
State E-filing Fees: While federal e-filing is often included with the desktop software purchase, there's usually a small additional fee to e-file state returns. You can avoid this fee by printing, signing, and mailing the state return.
Step 6: E-filing and Record Keeping
Sub-Step 6.1: E-filing Federal Returns
Review Thoroughly: Before e-filing, conduct a comprehensive review of each return within TurboTax. The software has built-in checks, but a human eye is invaluable.
E-file Limit: Remember, you can e-file up to five federal returns using a single TurboTax Desktop license.
Step-by-Step E-file Process: For each return, follow the on-screen prompts in TurboTax to e-file. You'll need the taxpayer's AGI (Adjusted Gross Income) from their prior year's return for verification purposes.
Confirmation: You will receive a confirmation email from TurboTax (and eventually from the IRS) once the return is successfully accepted. Keep these confirmations!
Sub-Step 6.2: E-filing or Mailing State Returns
Choose Your Method: Decide whether you will e-file the state return (incurring a fee) or print and mail it.
State E-file: If e-filing, follow the prompts within TurboTax for the state return.
Printing and Mailing: If mailing, print the entire state return, sign where indicated, and mail it to the appropriate state tax agency. Make a copy for your records.
Sub-Step 6.3: Maintaining Records
Digital Copies: Keep digital copies of both the
.tax2024file and the PDF version of each completed return in a secure and organized manner.Physical Copies: It's a good practice to print and retain a physical copy of each finalized tax return, including all supporting documentation (W-2s, 1099s, receipts, etc.).
Organized Folders: Create separate folders (digital and physical) for each family member for each tax year. This will make retrieving information in the future much easier.
Step 7: Communication and Privacy
Open Communication: Ensure clear communication with each family member regarding their tax information, deadlines, and any questions that arise.
Privacy: While you're preparing the returns on your computer, remember that each family member's tax information is private. If another family member is installing the software on their computer using your account credentials, be assured that their tax data will not be accessible to you through your Intuit account, as returns are saved locally. However, if you are the one preparing all the returns on your computer, you will, by necessity, have access to their sensitive financial data. Handle this information with the utmost care and confidentiality.
Secure Storage: Always store tax documents (digital and physical) in a secure location, protected from unauthorized access.
10 Related FAQ Questions
Here are 10 frequently asked questions, starting with 'How to', along with quick answers, to further assist you in sharing TurboTax with your family:
How to manage multiple family tax returns in TurboTax Desktop?
You can manage multiple family tax returns in TurboTax Desktop by using the "File" menu and selecting "New Tax Return" for each individual. Save each return with a unique file name to avoid overwriting.
How to avoid paying multiple times for TurboTax for family members?
To avoid paying multiple times, purchase the desktop/downloadable version of TurboTax. This allows you to prepare and e-file up to five federal returns from a single purchase, unlike the online version which requires a separate purchase per return.
How to transfer a previous year's TurboTax file for a family member?
If you have a family member's previous year's .tax file saved on your computer, TurboTax Desktop will prompt you to transfer it when starting a new return. Ensure you select the correct file belonging to that specific family member.
How to share the TurboTax desktop software installation with a family member on their own computer?
To share the TurboTax desktop software installation, your family member will need to use your Intuit account login (username and password) during the installation process on their computer. The license is tied to your account, but their tax data will be saved locally on their machine, not in your online account.
How to handle state tax returns for family members in different states?
If family members are in different states, you will need to purchase an additional state program within TurboTax Desktop for each unique state. The initial purchase typically includes one state program.
How to e-file a state return for a family member after preparing it?
After preparing a state return, TurboTax will guide you through the e-filing process, which usually incurs a small fee. Alternatively, you can choose to print, sign, and mail the state return to avoid the e-file fee.
How to ensure privacy when preparing taxes for family members on your computer?
Ensure privacy by saving each family member's return with a unique file name, backing up their data securely, and maintaining strict confidentiality of their financial information. Their data is stored locally on your machine, not shared via your Intuit account.
How to retrieve a lost TurboTax license code for desktop software?
You can retrieve a lost TurboTax desktop license code by logging into your Intuit account online, as the license is now linked to your account upon initial installation.
How to back up completed TurboTax returns for family members?
Back up completed TurboTax returns by saving both the .tax file and a PDF copy of each return to an external hard drive, USB drive, or a reputable cloud storage service.
How to get help if a family member's tax situation is too complex for you to handle?
If a family member's tax situation becomes too complex, consider seeking assistance from a qualified tax professional, such as a CPA or an Enrolled Agent. TurboTax also offers "Live Assisted" options where you can connect with a tax expert for help.