A tax practitioner has teamed up with a software engineer to create a new tax prep program aimed at preparers who service Spanish-speaking taxpayers, especially undocumented immigrants who are ready to begin filing tax returns.
Latino Tax Software's MultiTax distinguishes itself from more established tax software packages by helping clients obtain Individual Taxpayer Identification Numbers from the Internal Revenue Service and allowing them to file multiple years of tax returns they have avoided filing earlier. The software also lets preparers toggle quickly between screens in English and Spanish.
Company president Manuel Alvarez (pictured) started his practice, Latino Taxes, four years ago in California and has since grown it to 1,000 clients. About 85 percent of his clients are Hispanic and Brazilian, while the rest are Latino.
"Within the Hispanic and Latino community, there are some specific challenges," said Alvarez. "Many people have never filed their taxes in the past, so we help them prepare multiple years of taxes at a time. We work with a lot of undocumented immigrants. Many of them do not have a valid tax ID number, and we work with them so the IRS can choose an ITIN for them."
Alvarez, a Stanford University MBA, came up with the idea for the software a few years ago and met an engineer at Stanford who helped him develop the program after tax season this year. He previewed the software at the IRS's National Convention of ITIN Acceptance Agents in Dallas last month and plans to show it later this month at an IRS Tax Forum in New York.
Alvarez sees a lot of upside potential for his software, especially with the presidential candidates in both parties talking about the need for immigration reform. He is targeting several markets, including independent tax practitioners, service bureaus, and large tax prep chains. He noted that the Hispanic population is now an estimated 15 percent of the U.S. population and is predicted to grow to 25 percent by 2050.
He has already been in talks with some nationwide tax prep chains about his software. "They view the Hispanic market as one of the largest growth areas and they are very interested in the solution we're selling to drive efficiency," he said.
Alvarez plans to charge a base price of $500 for software to prepare just federal returns, or $800 for both federal returns and all the states. There will be additional fees for electronic filing, or $500 extra for unlimited e-filing. Users will be able to try the software for free for 30 days. A beta version of the software is expected to be available for download starting Monday.
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