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Cash App Taxes: How It Works & Is It Worth It?

100% free with no upsells? Here's everything you need to know about filing your tax returns through Cash App Taxes.

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With tax season upon us, you might be catching a serious case of MAS (Major Avoidance Syndrome). Making sense of how to file your taxes tempts many of us to press the “panic” button and hide underneath a rock until April, especially if you DIY your tax returns.

Filing your own tax returns using free tax filing services can make a stressful process less overwhelming—dare we say—easy. Cash App Taxes is one of many tax services that can help you file your federal and state taxes for free. 

Below, we’ll explain how Cash App Taxes works, how it stands up against similar free tax filing platforms, its pros and cons, and how to use it to file your returns this upcoming tax season.

What Is Cash App Taxes?

Cash App Taxes, formally known as Credit Karma Taxes, is the new kid on the block for free online tax filing services. They’ve rebranded for the 2022 tax season, but its super-efficient product model remains the same. 

Here are some notable features of Cash App Taxes:

  • Free state & federal returns filing: If you’re inclined to DIY your taxes, you can file state and federal returns for free. Cash App Taxes can help you prep and file most tax forms and schedules without paying a cent.
  • Basic support for standard or itemized deductions: The free online filing service can also help you determine what deductions you qualify for and whether you should opt for a standard or itemized return.
  • Import from other tax filing services: If you’ve used Credit Karma, H&R Block, TurboTax or TaxAct in the past to file taxes, Cash App Taxes gives you the ability to import last year’s data and personal information.

How to Use Cash App Taxes

Cash App Taxes imports your tax information from the year prior. Once you upload your 1040 form, the app will pull your adjusted gross income and personal data from the form.

To use Cash App Taxes, you’ll need to:

  • Download Cash App
  • Create an account
  • Import your prior year’s tax information
  • Fill out your current tax year data
  • File and submit your returns


While you can prep and file your taxes through Cash App Taxes on a computer, you’ll need to install the mobile app on your phone to get a unique QR code to actually file your taxes.

For your convenience, you can also prep your taxes for federal returns and some state returns on your smartphone. Features include:

  • Itemizing deductions and filling out your 1040
  • Submitting payment
  • Setting up direct deposit for your tax refund or post-dating a direct deposit of taxes you owe

Cash App Taxes: Pros and Cons

First, we’ll dig into the main benefits of using the free tax filing platform:

Pros

  • File for free. This is the major draw of using Cash App Taxes. You can file your state and federal returns entirely for free. Plus, you won’t be pressed to purchase any expensive add-ons.
  • Get your tax refund early. You can receive your tax refund up to five days quicker because you can receive direct deposits within the software as soon as they’re received. Just sign up for direct deposit using your bank account and routing number. They’ll drop a max of $25,000 into your account per direct deposit and up to $50,000 within a 24-hour period. With the average tax refund for the 2022 tax season hovering around $3,000, you can potentially receive the money quicker.
  • Maximum refund guarantee. Let’s say you originally filed your federal tax return through Cash App Taxes. Then, you file an amended federal tax return through another tax filing service. Cash App Taxes will refund you up to $100 of the difference if you owe less on your taxes or get a larger return through the other tax filing service.
  • Free audit defense. Filing your tax returns through Cash App taxes means you’re eligible for Free Audit Defense. Should you be flagged for a potential audit, Cash App Taxes will connect you with a qualified case manager to help you gather documents for your case, draft written correspondence to tax authorities on your part, and respond to inquiries.

Cons

  • Need to use the mobile app. While you can prepare and file your taxes on your computer, you’ll still need to download and install the Cash App Taxes app to log in and scan a unique QR code. After that, you can hop back onto your computer to continue the process. This isn’t a major deal, but it could dissuade app-weary folks.
  • Limited customer support. While Cash App Taxes is entirely free, there’s limited customer support. Plus, unlike some of its competitors, there’s no option to work with a tax professional.
  • Can’t file foreign or multiple state returns. Currently, multiple state returns, part-year state filings, or foreign-earned income aren’t supported.

Cash App Taxes vs. the Competition

While all tax preparation services help you prepare and file your return, they’re not all created equal. Here’s how are a few tax filing services to compare

H&R Block

Whereas Cash App Taxes is a 100% free tax filing service, you can also file a simple return (Form 1040, plus Schedules 1 and 3) for free through H&R Block.

H&R Block employs a team of tax professionals available to walk you through the process and answer any questions you might have (for an added fee). Plus, H&R Block’s ability to import information and forms, and connect to external accounts, are more sophisticated than Cash App Taxes.

TurboTax Free Edition

Similar to H&R Block, TurboTax’s free edition allows you to file state and federal taxes for free for simple tax returns. This could benefit those with W-2 income who take the standard deduction. With Cash App Taxes, you can file an itemized deduction, if you prefer to go that route.

TaxAct

TaxAct offers free filing on federal tax returns on simple returns (aka W-2 forms) and some credits and deductions. While you can file both state and federal returns for free through Cash App Taxes, Tax Act charges $39.95 for each state tax return.

Support differs among platforms, too. Cash App Taxes has limited support and no phone support, while TaxAct features real-time advice from a tax expert for no extra charge.

Who Is Cash App Taxes Best For?

Cash App Taxes is best for folks who want a relatively simple way to file state and federal taxes without needing to pay for a tax preparation service or tax professional. This includes:

  • 9-to-5 ers (aka those with W-2 tax forms)
  • Business owners 
  • Freelancers, gig economy workers, and self-employed folks

If you live with a disability, have student loans, or are a retiree, the tax filing service might also be a good fit for you.

As mentioned before, it’s not best for those who:

  • Live and work in multiple states 
  • Need to file multiple state returns 
  • Need to file a part-year state return 
  • Need professional support for complicated tax situations

Cash App Taxes could be a solid choice if you’re comfortable going fully DIY, or looking for an option to file your taxes for free without needing to purchase add-ons.

FAQs

Does Cash App Taxes have an accuracy guarantee?

Yes. Should you get dinged with a penalty or interest from the tax authorities due to a calculation error made by Cash App Taxes, you’ll get reimbursed up to $1,000 through gift cards.

Can Cash App Taxes file your taxes for free?

You can file both your federal and state returns for free through Cash App. There are no upsells or pricey add-ons.

Do I need to download the Cash App to use Cash App taxes?

Yes. If you don’t already use Cash App, you’ll need to download it to file your tax returns through Cash App Taxes. Once you’ve downloaded the app, you can prep and file your taxes from either your computer or smartphone.

Is Cash App Taxes secure?

Cash App Taxes complies with the IRS’s privacy, security, and business requirements. Cash App uses security measures such as 128-bit encryption, two-factor authentication and an on-site security team.

While we work hard on our research, we do not always provide a complete listing of all available offers from credit-card companies and banks. And because offers can change, we cannot guarantee that our information will always be up to date, so we encourage you to verify all the terms and conditions of any financial product before you apply.

Jackie Lam
Jackie Lam
Jackie Lam is a freelance writer with experience covering small business, insurance, budgeting, freelancing and money, and personal finance. Her work has appeared in Salon.com, BuzzFeed, U.S. World & News Report, Time's NextAdvisor, Forbes, and Refinery29. She is an AFC (accredited financial coach) and works with artists, freelancers, and small businesses to improve their relationships with money.

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