It’s the calm between the tax seasons. And if you are like most, it’s the bad experiences from the past tax season that you remember, not the good ones (assuming there were good ones). And, like many, it’s probable that at least sometime in the past several months you’ve said to yourself that it may be time for a change.
And with that in mind, we've created our 2016 Tax Prep Software Comparison Guide.
As far as we know, there are no official statistics regarding the turnover between tax seasons, but the chance to snag a user of another product is why tax prep vendors spend so much in advertising. That’s true on the professional level as well as in the market for consumer tax preparation software.
While you may be one of the users looking for more from their tax prep software, at the root, much of the functionality of any application is the same in offerings from multiple vendors. That’s as true of tax preparation software as any other application. But the fact that the market supports multiple preparation products and vendors also points out that there is a difference between products and vendor offerings.
Sometimes that difference is in features, sometimes it’s in the perception of support, and at other times it might be in the approach a particular vendor or product offering takes in data entry, verification or timeliness of updates. Vendors can also differ in which forms and schedules they support.
When you’ve used an application for years, it’s easy to develop inertia. The prospect of changing to another vendor’s application can be daunting, especially when considering that not only will you and your permanent staff have to learn a new way of doing data entry and possibly a new workflow, but you’ll also have to know it well enough by tax season to teach seasonal employees.
But if you are really dissatisfied, or simply have different needs, take solace in the fact that vendors make it easier to switch every year. Most offer file conversion services and work on making data entry and application use easier to learn and easier to perform.
To get you started, we’ve assembled a comprehensive features chart. We’ve also asked the major players in the professional tax preparation market what new features they added or changed in the tax season just past, and what they are working on for the upcoming onslaught. In some cases, the vendors were reluctant to share work in progress, but a number of vendors responded positively. (For details on each tax prep software vendors plans for new features, see the online version of this story at AccountingToday.com.)
While no article or chart is going to provide enough information for you to make the decision to switch, it will hopefully let you narrow down the field to just a few vendors and products. After that, you can take over the fact-finding, and perhaps even take advantage of the free evaluation software most tax prep vendors offer.
VENDOR BY VENDOR
Wolters Kluwer CCH Axcess and CCH ProSystem fx Tax
The upgrades for the past and coming tax seasons are applicable to both CCH tax products, Axcess and ProSystem fx Tax. In the 2015 tax season, Wolters Kluwer created a faster and more efficient process for customers to download and install their tax software. Also implemented were CCH eSign capabilities, security, and tracking to any document within the firm such as engagement letters, internal documents, and Form 8879. The new My1040Data online organizer introduced for the past tax season takes a new approach to gathering tax return information, minimizing client data entry and allowing more efficient collection of client source documents.
In 2015 and for the upcoming 2016 filing season, Wolters Kluwer has added more than 40 new e-file states and cities and will continue to add new jurisdictions as they become available for the taxing authorities. They have also created more efficiency with additional e-mail notifications, so you’ll know immediately the status of e-filed returns. In addition, when using CCH eSign to send Form 8879 to your clients, the status is automatically updated their Electronic Filing Status System.
CCH Small Firm Services
ATX 2015 provided integration with both the CCH iFirm practice management platform to improve tax-return workflow efficiency, and the comprehensive Wolters Kluwer tax research solution CCH IntelliConnect. Expanded calculation capabilities for preparing complex returns included optimization of complicated tax calculations, such as credit for state taxes paid and optimization of education benefits, along with expanded municipal reporting. Additional asset reporting options also expanded the capabilities of the tax product’s large available forms library. For the coming year, ATX will develop even deeper integrations with research and practice management to help preparers maximize their firm’s workflow efficiency.
For tax year 2015, TaxWise introduced integration with the CCH iFirm practice management platform and a new e-signature feature as well as a host of enhancements to the cloud-based TaxWise Online. For the 2016 tax year, TaxWise will introduce closer integration with tax help powered by CCH IntelliConnect and further enhancements to e-signature. The TaxWise Online platform also will have a refreshed interface and new, built-in document management feature.
It was too early for Drake to talk about features in development for next tax season. In their 2016 tax preparation software, Drake introduced LookBack, which allows you to review prior-year data entry from within current year program, LinkBacks so you can track calculated results on the tax return back to the source data, and DoubleCheck that verifies line items on a tax return and flag them for review.
Intuit Lacerte, ProConnect Tax Online and ProSeries
For 2015, Lacerte added Intuit Link, a new technology making client collaboration easier and faster, with features like financial institution data downloads and mobile data capture. As part of the e-File build process, Lacerte also added the ability to automatically identify and convert required forms to PDFs. For tax year 2016, look for a unified workflow experience to collect payment and eFile as well as key enhancements that let tax preparers deliver a customized experience to their clients like auto reminders, e-mail templates and custom branding.
In 2015, ProConnect Tax Online launched Jump-to-Input, making it easier for new users accustomed to the forms view. Also improved was integration with Intuit Link client portal and QuickBooks Online Accountant to save time collecting client data. Other upgrades included updated navigation, search and the client list based on customer feedback improving the ability to find and use data, and security was bolstered with multi-factor authentication protocols. For 2016, the primary focus will be on enabling direct download of client data from financial institutions to save time and increase accuracy.
In 2015 ProSeries was updated with additional forms to support tax preparers’ filing needs. ProSeries customers were also introduced to Intuit Link, an online portal that helps simplify client data collection. Support for Audit Assistance was added, as well as also adding additional banks for greater connection to the company’s Pay-by-Refund offering. In 2016, Intuit is enhancing the features of Intuit Link with customizable templates and automated reminders. Additionally, ProSeries will support 1040 NR e-File functionality in line with IRS development.
Thomson Reuters UltraTax CS and GoSystem Tax RS
For the 2015 tax season, UltraTax CS expanded eSignature capabilities, including Form 8878 and engagement letters for non-1040 entities and further streamlined and automated the installation and update process. Client letters are now editable in Microsoft Word and tickmark capabilities are now available in supporting detail statements. UltraTax RS also added form and e-file support for Form 2290, Heavy Highway Vehicle Use Tax return as well as support for a number of additional return and e-file capabilities.
Thomson Reuter’s other tax preparation system, GoSystem Tax RS, rolled out a new, more efficient return listing/look-up screen and launched the new Customer Center help platform. This platform lets customers use chat-based support for e-file and systems questions and provides a new searchable repository of solutions to prior customer support questions. Also implemented in the past tax season were new Web-ticketing capabilities to make online support cases much quicker and easier, a streamlined e-file process providing additional data entry validation, and partnering with customer firms to redesign the K-1 data entry in 1040 returns for both power and ease-of-use.
For what’s coming next tax season with both products, Thomson Reuters will be focusing on new developments that will allow them to keep up with not just regulatory changes, but changes in the profession like tax theft identity, the ongoing shift to cloud-based solutions, and better accountant-to-client collaboration.
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