Yes, TurboTax allows an upgrade from Deluxe to Home & Business, but it requires purchasing the new version and transferring your data manually.
Understanding TurboTax Versions and Upgrade Options
TurboTax offers several versions tailored to different tax situations, with Deluxe and Home & Business being two of the most popular. Deluxe targets individuals who itemize deductions or need to maximize tax credits. In contrast, Home & Business is designed for self-employed individuals, freelancers, and small business owners who need to report business income and expenses alongside their personal taxes.
Upgrading from TurboTax Deluxe to Home & Business isn’t as simple as clicking a button inside the software. Unlike some other software packages that allow seamless in-place upgrades, TurboTax requires you to purchase the Home & Business edition separately. This is because each edition contains specific features and forms tailored to its target users.
Once you’ve purchased the Home & Business version, you can import your data from the Deluxe return file. However, this process isn’t fully automatic; some manual adjustments might be necessary to ensure your business income and expenses are correctly entered.
Why Upgrade from Deluxe to Home & Business?
If you started your tax return with TurboTax Deluxe but later realized that you have self-employment income or business deductions, upgrading becomes essential. The Deluxe version lacks forms such as Schedule C (Profit or Loss from Business), which are crucial for reporting business activities.
Home & Business includes:
- Schedule C support for sole proprietors
- Guidance on home office deductions
- Tools for tracking business expenses and mileage
- Access to additional forms related to self-employment taxes
Without upgrading, your tax return will be incomplete or inaccurate if business income is involved. The upgrade ensures compliance with IRS requirements and maximizes potential deductions.
Step-by-Step Process to Upgrade TurboTax Deluxe to Home & Business
Upgrading TurboTax Deluxe to Home & Business involves several clear steps:
1. Purchase TurboTax Home & Business Edition
You must buy the Home & Business edition either online through Intuit’s website or via retail stores. The cost varies depending on whether you choose the desktop CD/download version or the online version.
2. Install or Access the New Version
For desktop users: install the new software on your computer. For online users: log into your TurboTax account and select the Home & Business option.
3. Import Your Existing Return Data
Open your previous Deluxe return file (.tax file) in the new Home & Business software. This imports your personal information, W-2s, deductions, and other entered data.
4. Manually Add Self-Employment Income and Expenses
Since these details aren’t supported in Deluxe, you’ll need to enter them manually in Home & Business under Schedule C sections. Double-check all entries carefully for accuracy.
5. Review and File Your Return
After entering all necessary data, run TurboTax’s review tools to detect errors or missing information before e-filing or printing your return.
The Cost Implications of Upgrading TurboTax Editions
Upgrading isn’t free — it involves purchasing a new license for the higher-tier product. Here’s a breakdown of typical pricing for various TurboTax editions during tax season:
| TurboTax Edition | Approximate Price (Online) | Main Features |
|---|---|---|
| Deluxe | $59 – $69 | Deductions, credits, mortgage interest, charitable donations |
| Home & Business | $109 – $119 | All Deluxe features + Schedule C support + business expenses + home office deduction |
| Self-Employed (Online) | $120 – $140+ | Includes tools for freelancers/contractors + expense tracking + industry-specific deductions |
Keep in mind that prices fluctuate with promotions and discounts throughout tax season. Additionally, state filings usually incur extra fees per state return.
Data Transfer Limitations When Upgrading From Deluxe To Home And Business?
One common question is whether all data transfers smoothly when upgrading from Deluxe to Home & Business. The answer is nuanced.
Basic personal information like Social Security numbers, addresses, W-2s, dependents’ info transfers without issue. However:
- No automatic import of business income or expenses: Since these aren’t supported in Deluxe returns initially started without them.
- Certain deduction categories may require re-entry: For example, if you claimed home office deductions incorrectly in Deluxe (which lacks proper forms), you’ll need to redo them.
- No merging of multiple returns: If you have separate returns (e.g., one started as Deluxe and another as Home & Business), merging is manual.
This means that while upgrading helps avoid starting completely over, expect some manual work entering self-employment details accurately.
Troubleshooting Common Upgrade Issues
Some taxpayers encounter hiccups during this process:
- Error messages when importing files: Usually resolved by updating software versions or reinstalling.
- Mismatched data fields: Double-check imported entries against source documents.
- Duplication of entries: Happens if importing multiple times; delete duplicates carefully.
- Lack of access to certain forms: Confirm you purchased correct edition before attempting import.
TurboTax offers customer support and community forums where many users share solutions for these common challenges.
The Benefits of Choosing Home & Business Over Staying With Deluxe Only
Opting for Home & Business instead of sticking with Deluxe pays off in several ways:
- Simplified Tax Filing: All necessary forms are built-in so no scrambling for external paperwork.
- Deductions Maximized: The software guides users through industry-specific write-offs like vehicle expenses or equipment purchases.
- Avoid IRS Red Flags: Properly reporting self-employment income reduces audit risk compared with incomplete filings.
- Saves Time: Automated calculations for self-employment tax reduce manual math errors.
- User-Friendly Interface: Step-by-step prompts tailored specifically for small business owners make filing less daunting.
- Email Support/Live Assistance: Often included with higher-tier versions like Home & Business.
These advantages justify the upgrade cost if you have any freelance gigs, side hustles, or small businesses generating taxable income.
The Legal Side: IRS Requirements That Necessitate Upgrading Your Tax Software
The IRS mandates accurate reporting of all income sources including wages (W-2), investment earnings (1099-DIV/INT), and business profits (Schedule C). Filing a personal return without including Schedule C when required can lead to penalties or audits.
TurboTax’s different editions reflect these legal requirements by bundling appropriate forms:
- Turbotax Deluxe: Supports standard individual returns but excludes Schedule C.
- Turbotax Home & Business: Includes Schedule C plus related forms such as SE (self-employment tax).
Failing to upgrade means missing critical forms needed by law when reporting self-employment income — which could trigger IRS notices demanding amended returns later on.
The Impact on State Returns When Upgrading From Deluxe To Home And Business?
State tax returns often mirror federal requirements but vary widely across states regarding business income reporting rules and credits available.
When upgrading:
- Your state return will also reflect new business-related inputs once imported into the upgraded software.
- If your state has specific credits/deductions tied to small businesses (e.g., California’s Qualified Small Business Stock exclusion), those become accessible only via higher editions supporting these features.
Note that each state filing generally costs extra regardless of edition chosen — so factor this into total upgrade expense calculations.
Key Takeaways: Can I Upgrade Turbotax Deluxe To Home And Business?
➤ Upgrade available: You can upgrade from Deluxe to Home & Business.
➤ Additional features: Home & Business includes self-employment tools.
➤ Cost difference: Upgrading requires paying the price difference.
➤ Data transfer: Your Deluxe data imports into Home & Business easily.
➤ Support included: Home & Business offers priority customer support.
Frequently Asked Questions
Can I Upgrade TurboTax Deluxe To Home And Business Easily?
TurboTax does not offer a direct in-software upgrade from Deluxe to Home & Business. You need to purchase the Home & Business edition separately and then import your Deluxe data manually. Some adjustments may be required to ensure all business-related information is correctly entered.
What Is Required To Upgrade TurboTax Deluxe To Home And Business?
To upgrade, you must buy the TurboTax Home & Business edition either online or in stores. After purchasing, you install or access the new version and import your existing Deluxe tax return data. Manual review is important to include all business income and expenses accurately.
Why Should I Upgrade TurboTax Deluxe To Home And Business?
If you have self-employment income or need to report business expenses, upgrading is essential. The Deluxe version lacks forms like Schedule C, which are included in Home & Business. This upgrade helps ensure your tax return complies with IRS rules and maximizes deductions.
How Do I Transfer My Data When Upgrading TurboTax Deluxe To Home And Business?
After purchasing Home & Business, you can import your data from the Deluxe return file. The transfer isn’t fully automatic, so you should carefully review and adjust entries related to business income and expenses to avoid errors on your tax return.
Are There Any Additional Costs When Upgrading TurboTax Deluxe To Home And Business?
Yes, upgrading requires buying the full Home & Business edition separately. The price depends on whether you choose the desktop or online version. There is no discounted upgrade price within the software itself, so plan for this additional expense when upgrading.