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Accounting · head to head

TaxAct vs Xero

TaxAct logo

TaxAct

Accounting

Get your maximum refund, guaranteed

From
Free
Rated
-
Full reviewWebsite
Xero logo

Xero

Accounting

Beautiful accounting software

From
$13/month
Rated
-
Full reviewWebsite

The short version

  • Only TaxAct has a free tier, so it costs nothing to try first.
  • Each has a real cost: TaxAct free edition available only to approximately 40% of filers; Xero the Early plan caps you at 20 invoices and 5 bills per month, and the invoice limit counts both approving and sending
  • Prices and features above were last checked on 31 August 2026.

Where they differ

Only the attributes on which TaxAct and Xero actually diverge.

Attributes where TaxAct and Xero differ
AttributeTaxActXero
Starting priceFree$13/month
Pricing modelone-timesubscription
Free tierYesNo
PlatformsWebWeb, Ios, Android, Api
FoundedUnknown2006

Identical on both: user rating (Not yet rated), category (Accounting).

What each one covers

Drawn from each product's published feature list. An absence here means we hold no record of it - not that the product lacks it.

Only in TaxAct

Nothing recorded that Xero does not also cover.

Only in Xero

  • Bank reconciliation
  • Invoicing
  • Bill payment
  • Expense claims
  • Financial reporting
  • Inventory tracking
  • Project tracking
  • Mobile apps

What people use each for

The jobs each tool is most often brought in to do.

TaxAct

  • Individual tax filingnot Xero
  • Self-employed tax preparationnot Xero

Xero

  • Small business bookkeeping, invoicing and bank reconciliationnot TaxAct
  • Bill payment and purchase order managementnot TaxAct
  • Sharing books with an accountant or bookkeepernot TaxAct

Where each one falls short

Documented limitations, not opinions. Every one is a constraint you would hit in normal use.

TaxAct

  • Free edition available only to approximately 40% of filers
  • Pricing excludes separate state filing fees
  • Xpert Full Service pricing available on request only

Xero

  • The Early plan caps you at 20 invoices and 5 bills per month, and the invoice limit counts both approving and sending
  • Invoices created by connected app partners count against the Early plan invoice limit
  • Multiple currencies, project time and cost tracking, employee expense and mileage claims and industry benchmarking are restricted to the top Established plan at $90 per month
  • Cash flow forecasting is capped at 30 days on Early and 60 days on Growing, with 180 days only on Established
  • Payroll is not included in any plan and costs an extra $36 a month plus $6 per employee or contractor through Gusto
  • Inventory Plus is a paid optional add-on rather than part of any plan
  • The advertised 90% off applies only to the first 6 months, after which the regular $25, $55 or $90 monthly price auto-renews
  • The introductory discount excludes add-ons, usage charges and payment fees
  • Payment fees apply to online invoice payments and to bill payments other than standard domestic ACH, and are billed on top of the subscription
  • Subscriptions are billed monthly with no annual payment option, and after upgrading you must wait one month before downgrading to a cheaper plan
  • Xero states subscription prices are increasing from October 1, 2026

Pricing, plan by plan

TaxAct

Free
  • Free EditionFree
    • W-2 income
    • Unemployment
    • Basic credits and deductions
  • Deluxe$59.99/tax-year
    • All Free Edition features
    • Home ownership deductions
    • Childcare and dependent care
  • Premier$99.99/tax-year
    • All Deluxe features
    • Investment income and capital gains
    • Cryptocurrency reporting
  • Self-Employed$109.99/tax-year
    • Complete business support
    • For contractors, freelancers, and sole proprietors

Xero

$13/month
  • Early$13/month
    • Send 20 invoices
    • Enter 5 bills
    • Reconcile bank transactions
  • Growing$37/month
    • Unlimited invoices & bills
    • Bulk reconcile transactions
    • Short-term cash flow
  • Established$70/month
    • Everything in Growing
    • Use multiple currencies
    • Track projects

Which should you pick?

Choose TaxAct if

  • You want to start without paying.
TaxAct review

Choose Xero if

  • You need bank reconciliation.
  • You work on Web, Ios, Android, Api.
  • You also want invoicing.
Xero review

Questions people ask

Is TaxAct or Xero better?
Neither clearly leads. TaxAct starts at Free and Xero at $13/month, and user ratings are close enough to be indistinguishable. Choose on capability and platform support.
Which is cheaper, TaxAct or Xero?
TaxAct has a free tier; the other does not. Paid plans start at Free for TaxAct and $13/month for Xero.
Does TaxAct or Xero run on more platforms?
TaxAct runs on Web. Xero runs on Web, Ios, Android, Api.
Can I use TaxAct for free?
Yes. TaxAct has a free tier, so you can try it without paying. Xero starts at $13/month.
What is TaxAct best used for?
TaxAct is most often used for individual tax filing, self-employed tax preparation. Of those, individual tax filing and self-employed tax preparation are not what Xero is typically brought in for.
What can TaxAct do that Xero cannot?
Xero covers Bank reconciliation, Invoicing, Bill payment, Expense claims.

Answered from the vendors’ own pages

TaxAct: How much does TaxAct cost?

TaxAct offers a free edition for approximately 40% of filers, Deluxe at $59.99, Premier at $99.99, and Self-Employed at $109.99 per tax year.

Source
TaxAct: Is TaxAct truly free for eligible filers?

Yes, TaxAct's Free Edition is available at no cost for W-2 employees, students, and filers meeting basic income and deduction requirements.

Source
TaxAct: What is the difference between Premier and Deluxe plans?

Premier adds support for investment income, capital gains, cryptocurrency, rental properties, and home sale reporting compared to Deluxe.

Source
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