Tax Software Preview 2005: Work Smarter & Faster

Time-savings tax-software features are fueling efficiency, accuracy and speed.


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For tax season 2005, software vendors, like the automakers, are touting speed. Many new features are designed to shave time off the preparation of every individual and business tax return. Time-saving tools include the ability to quickly move from one screen to the next, access to more state and federal tax forms and the ability to automatically populate data from a client's W-2 to their 1040.

For example, Drake Software has updated its data-entry module to conform to Microsoft Windows. The new module, available on all its tax packages including individual, corporation and partnership returns, will be natural for Windows users, says Tim Hubbs, president and CEO of the Franklin, N.C.-based company.

"We are bringing the software to be more in line with what's already in the market.'' notes Hubbs. "In my view, the old version can't be beat in terms of speed. The new one will be more intuitive for people accustomed to Windows functions."

Partner Insights

For a lot of users, speed is important, but not just in operating the software. And here's where Drake's tech on the support line counts, says Sharon Falardeau, an Enrolled Agent in Woodburn, Ore., who switched to Drake from Orrtax last tax season. Falardeau, who prepares about 200 returns a season, calls Drake approximately once a week during tax season. "They're so quick,'' Falardeau says, "I call rather than spend the two or three minutes to look it up on the computer." She contrasted that with her previous supplier, Orrtax, who would put her on hold for 30 minutes during the 2004 tax season. Also, she continues, "Drake's software is user friendly and for the same $1,000, I receive extra features that I didn't have before,'' An Orrtax spokesperson says that glitches in both the Orrtax and Internal Revenue Service computers produced a high-volume of inquires last year and the problems have been eliminated.

Similarly, the goal of the enhanced features being offered by Intuit's Lacerte operation is to save the user one minute on each return rather than seconds on just a few. The company is making it possible to automatically populate data from a W-2 form into the electronic file, says Jorge Olavarrieta, senior product manager for Lacerte. "We can't eliminate data entry, but we can certainly simplify it."

Lacerte also now has navigation between tax forms and the tax laws so that preparers don't have to leave the pages that they are working on.

Intuit has the same goal with its ProSeries software. "Customers don't need a lot of new stuff,'' says David Kramer, group product manager for ProSeries, "but, there are opportunities to do what we do better to help them prepare tax forms faster."

ProSeries users now can instantly access state and federal forms by typing in the name of the form desired, which should be far faster than having to search through a checklist of forms, click through to the category, and then click on the form.

For those who prepare taxes for workers from a large employer in the area, ProSeries Express will automatically populate the employee identification number on the forms 1040 and 1040EZ.

Perhaps one of the biggest changes was the pricing for ProSeries. The company offered users who signed up early a three-year freeze on pricing. Also, for the cost conscious, Intuit introduced ProSeries Basic for the past tax season. For the upcoming one, users can customize client's letters to include their logo and print the logo on their invoices. They can also preview a completed page before it is printed.

The Forms Approach

TaxWise, which sports a more forms-like interface, also is simplifying data-entry and striving for ease of use. "We have introduced a lot of drop-down menus wherever there are IRS required fill-ins. There are also auto form-fills," notes Gene Goldenberg, vice president of marketing for the Rome, Ga.-based company.

TaxWise also has added context-sensitive help to the bottom of each page. The new QuickLink enables users to click on an icon to be automatically taken to the source field for information that has been carried to a form.

"In general, we have tried to make the program even easier and faster to use," says Goldenberg. "Despite the fact that these are professional programs, in many situations, whether it's a CPA office or a retail tax situation, there are always seasonal people and new people."

ATX/Kleinrock similarly changed its interview feature, adding context-sensitive help and letting the users customize the interview itself, says Ken Crutchfield, vice president of the Rockville, Md.-based company.

The company's tax software has improved diagnostics that include more than 8,000 error messages to alert the preparer when entered data is inconsistent with the rest of the return. ATX has also tightened the integration of its tax preparation with the tax research products from Kleinrock, its sister company, to provide preparers with instant answers. This is accomplished by adding line-by-line linkages from the seven major forms - 1040, 1041, 1065, 1120, 1120s, 990, and payroll - and their supporting schedules to the corresponding sections of the Complete Tax Library.

A Clearer View

CCH Tax and Accounting is simplifying the Worksheet View that it introduced with its software for the 2004 tax year. That includes improving keystroke functions to simplify data entry for users who would like to use a mouse less.

The company has also added Office Manager options that can limit staff access to either Interview Forms or Worksheet View and scrolling between state K-1s to increase the speed of both data entry and review. Another change aimed at speed is the elimination of the Organizer View and Financial Statement input methods.

ProSystem fx is also supporting dual monitor systems, frequently used in paperless environments. CCH is adding an optional DVD installation because new functions mean that in October it will need to ship two installation CDs, while the DVD technology can still hold all the data on a single disk.

"We know how CPAs are using the technologies," says Ernest Zoumot, director of software product management for CCH ProSystem fx, "we want to make certain that ProSystem fx tax works well with these new technologies and provides our clients with maximum flexibility and efficiency."

The Torrance-Calif.-based group has expanded the integration of ProSystem fx Tax with its other ProSystem fx products. Financial statement data can now be exported to its Profit Driver and Write-up software, while the company's DynaLink and Quiklink tools let users import farm and rental property tax lines into a tax return from ProSystem fx Engagement.

CCH is integrating ProSystem fx Tax with Sage Software's FAS Asset Accounting, one of the results of an alliance that the two vendors struck last year when Sage decided to drop its CPASoftware tax line.

The Web is an also increasingly important part of the tax prep game, although it has a long way to go in user acceptance.

Creative Solutions gave its clients around-the-clock access to read-only version of returns via its Ultra Tax 1040 portals. Completed returns are posted on a private portal for the client to access with a secured password.

"This is the last touch for making a tax return completely paperless,'' says Jack LaRue, CSI's vice president of marketing. Having returns available on the Web should lessen the client's need to request the accountant retrieve copies for bankers when applying for a mortgage. UltraTax CS 1040 is priced at $2,000. The portals cost $5 each per tax return or $1,000 for an unlimited number of returns.

CSI, which rebranded its product line this year, is extending the ability of its products to work with the same data. Currently, UltraTax CS can track the status of 50 different items, including status, whether efiled, or amended. The new Practice CS is able to show the status of tax files through a dashboard that is automatically updated.

CSI is also increasing the integration of its products with those of its sister company RIA Compliance. That includes two-way links between GoSystem, UltraTax CS and Engagement, which is being extended to other CSI accounting products. Previously, users could export balances from the accounting product to the tax product. With two-way transfers, accountants can go into the tax product to make adjustments and export the data to the accounting software.

CSI has also integrated its Form/LineFinder with RIA Checkpoint tax research system and is working on integration with another sister company PPC. Form/LineFinder is expected to integrate with PPC's 1040 DeskBooks.

For many users, the strength of GoSystem RS continues to be the basic fact that it is Internet-based and can be accessed from anywhere at any time. "We are a paperless firm. Everything that we do is through some kind of electronic medium," says Mike Kolk, partner in charge of tax for Akron, Ohio-based Cohen & Co. The firm has 40 to 50 people in the tax department and it is useful to have access from any of its six offices or from other locations. "We have people at home that access RS through our VPN [virtual private network]," he says.

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