Are you a small business owner who owns a company? Or, maybe you’re employed in a corporate environment and think about starting your own business? Or possibly you’re simply thinking about doing your own taxes for the very first time, but aren’t completely sure how to move forward. Either way, after you listen to my presentation on best tax software for business owners and learn the basics of how to prepare taxes, I think you’ll feel more comfortable moving forward with the task.
Would you like to learn tax software for small business? If you’re a small business owner or part of a growing company, the idea of tax preparation may be daunting. There are many different tax software packages on the market. Which one is right for you? The following guide will shed some light on best tax software for small business owners.
TaxAct
TaxAct is our choice for best overall tax software for small business owners because you can prepare both your individual return and business return in its online program. TaxAct is the only software reviewed that offers online preparation of both individual returns (Form 1040) and business returns (Forms 1120, 1120S, and 1065). The biggest drawback to the online program is that the price includes only one return, whereas desktop programs can be used for multiple returns. The typical C corporation (C-corp), S-corp, or partnership owner will spend $264.80 for their individual and business returns.
What We Like
- Online preparation of Forms 1040, 1120, 1120S, and 1065
- Import income and expense accounts from any software as a comma-separated values (CSV) file
- Save time by importing stock transactions
What’s Missing
- Price includes only one return, so it becomes expensive if you have multiple businesses
- No special cryptocurrency support
- No tax pro assistance for business returns
Pricing
- $64.95 per Federal Form 1040 individual return
- $44.95 per state individual return
- $109.95 per Federal Form 1120, 1120S, or 1065 business returns
- $44.95 per state business return
Features
TaxAct is ideal for businesses that want one-on-one tax assistance and also businesses that need to file corporate or partnership returns. It also provides an accuracy and maximum refund guarantee, a tax calculator, and a deduction maximizer. Its mobile app lets you electronically file (e-file) your returns and also track your IRS refund.
- Accuracy/Maximum Refund Guarantee: If you receive a reduced refund, increased tax liability, or have to pay a penalty or interest due to a TaxAct error, your fees will be covered by TaxAct. It will refund your software costs and pay any difference in your lower refund or higher tax liability.
- Mobile app: The TaxAct Express app lets you e-file your federal and state tax returns, file free federal extensions, track your IRS refund, and capture W-2 data. You can also switch seamlessly from the app to the desktop, picking up where you left off.
- Deduction maximizer: Using a question and answer format, TaxAct will provide you with a step-by-step guide to assist you with completing your returns while also maximizing your deductions. This tool is beneficial for self-employed individuals, who will be able to identify common deductions that are specific to their work.
- Tax calculator: TaxAct’s tax calculator allows you to look ahead to future years by creating what-if scenarios in your current return. You can also project changes to the data to estimate your tax liability for current or future years.
- Data import: You can import your previous year’s tax return as a PDF, regardless of whether you used TaxAct or another tax software.
Our Expert Opinion
TaxAct has a dashboard that shows all your current and prior-year returns filed with TaxAct Online. You can start a new return of any type with one click that begins the TaxAct interview process. Start as many returns as you like and only pay when you’re ready to file. The dashboard also provides useful tools like a quick tax estimator and tax planner.
Income and expenses can be imported from virtually any bookkeeping software by means of a CSV file. TaxAct provides a link from the interview to the help section that explains exactly how to format your CSV file or spreadsheet for import. You can get answers to your tax questions in its Answer Center, but you can’t talk directly with a tax professional.
Many small business tax programs offer some kind of audit support, whether that’s providing advice, consulting, or defense. While TaxAct does provide audit defense via its partner company Protection Plus, the cost is $49.95 and covers three years of audit services. However, if you’re only looking for audit assistance, TaxAct is lacking in this area, with only an FAQ page on its website. For a better option, check out TurboTax. Its Audit Support Guarantee gives you free one-on-one audit guidance from a trained tax professional and assistance with what to expect and how to prepare for the audit.
TurboTax
The venerable master of tax return software
TurboTax is a very popular choice for small business owners and it’s got a long track record that has helped to hone its impressive feature set. There’s a downloadable dedicated Business package too, which helps you work out the most advantageous tax-saving strategy for your concern.
It also lets you create unlimited W-2, 1099-MISC, 1099-INT and 1099-DIV forms, prepare tax returns for multiple businesses as well as allowing you to import from QuickBooks. There’s also lots of support available, with CPAs and EAs on hand, which might be particularly useful if you’re new to the tax filing process for small business.
You can also configure a TurboTax package to suit your specific requirements, with the Self-employed package being useful for tackling both personal and business income. Overall, TurboTax is user-friendly and a practical option if you’re going to need some hand-holding along the way.
H&R Block
A beefy solution with lots of features
H&R Block is a great contender in the small business tax software arena in that it comes with an impressive array of tools for tackling more complex issues. As a brand, H&R Block is widely recognized as being one of the oldest suppliers in the business, but it does come at a price. That’s for good reason though, as H&R Block is a potent solution, with small business solutions in the shape of H&R Block Online, for the self-employed and H&R Block Office for small business.
One of the best things about it, especially if you’re a small business with demanding tax affairs, is that it’s possible to chat things through with specialists as part of the package. Choose from the likes of the H&R Drop-off service, the remote Tax Pro Go or the practical In-Office solution and all bases are covered. H&R has also teamed up with Xero, which means you also get accounting benefits too. Tie everything together and you’ve got a comprehensive solution.
You’ll want to be sure you’re going to make use of all its features if you do go for H&R Block, but it’s certainly got the lot. Packages cover a raft of users, but sole proprietors will want to look at the likes of Premium Online or Self-Employed Online. H&R Block also has new products under the Online Assist banner, that feature on-demand help from a tax expert, enrolled agent, or CPA.
TaxSlayer
A bargain tax solution for the self-employed
If you work for yourself then TaxSlayer’s Self-Employed package is a popular option as it’s ideally suited for the likes of contractors, 1099ers and other sole proprietors. At the same time, you get quite a good range of features and functions, and all for a reasonable price depending on the current TaxSlayer deal at any given time.
You’ll find TaxSlayer is nicely designed with an intuitive interface, plus there’s the added benefit of audit assistance if required. Considering its relative affordability, being able to talk things through via support is a bonus that adds in more value.
If you’ve got fairly minimal requirements and simple filing affairs to handle then this self-employed package might well fit the bill. Avoid it though if you’re running a business where you’ll need a more comprehensive suite of tools. TaxSlayer’s Self-Employed bundle is good, but it’s certainly not geared up for larger tax tasks.
Block Advisors
H&R Block is known for its tax preparation services, and it also offers financial support all year round with Block Advisors. Focusing specifically on small businesses and self-employed individuals, it allows you to either partially or fully outsource not only your tax prep but also your bookkeeping and payroll. Block Advisors is affordable and offers plans for different budgets, depending on how involved you want to be. You can work with your financial expert on the phone or online and can customize a package that will fit your needs.
What We Like
- Access to a financial professional near your home or business
- Ability to tailor a package that includes taxes, bookkeeping, and payroll support
- Customize reports including profit and loss (P&L) statements and structural analytics
What’s Missing
- Pricing isn’t totally transparent and requires a $50 consultation for more information
- Desktop software not available
- DIY option isn’t available for corporate and partnership returns
Pricing
- Self-employed: Starting at $195 to do your own and $229 to work with a pro
- S-corp, C-corp, and partnership: Starting at $250 to work with a pro
- Personalized consultation: $50
- Bookkeeping: Starter plan starting at $50 per month, full-service plan starting at $150 per month
- Payroll: Self-employed services starting at $59 per month, One+ Employees plan starting at $70 per month plus $10 per employee per pay run
Features
In addition to its accessible support options and personalized tax help, Block Advisors provide year-round accounting assistance that includes bookkeeping and payroll services. This is offered due to its partnership with Wave, which provides free accounting software. Block Advisors also guarantees its services with the 100% Accuracy Guarantee.
- Personalized tax help: With Block Advisors, you’ll receive unlimited live support from a tax advisor who has specialized training in small business taxes. They’re available year-round and have an average of 12 years of experience.
- 100% Accuracy Guarantee: If Block Advisors make an error on your return, they’ll reimburse you for any resulting penalties and interest. To qualify, the error must not be due to incomplete, inaccurate, or inconsistent information supplied by you.
- Accessible support: Block Advisors are available via phone, live chat, or video call.
- Year-round accounting assistance: In addition to its tax services, Block Advisors also provide bookkeeping and payroll support. For other options, check out our recommendations for the best online bookkeeping services.
- Wave partnership: Wave offers a tax filing integration with Block Advisors, which allows you to seamlessly file your taxes based on your accounting data in Wave.
Our Expert Opinion
Block Advisors is a branch of H&R Block, and most of its services are provided either online, over the phone, or through an H&R Block office. You have the option of handling most everything yourself with some outside support or handing everything off to an accounting expert. Because you’ll be assigned to a dedicated Block Advisor, you have the benefit of a personal relationship with someone who may be able to offer tax and money-saving strategies.
For all of its attractive features, Block Advisors doesn’t offer you the ability to file unlimited amended returns. If this is something you’re after, we suggest FreeTaxUSA, which does have this option. FreeTaxUSA offers inexpensive state return filing and supports a variety of business forms.
Conclusion:
If you own a small business, you couldn’t be blamed if you get anxious at the thought of preparing and filing taxes. And now that we’re in the middle of tax season, you may have more to worry about than just quarterly tax payments. You could be missing out on tax deductions or credits that you qualify for – often small businesses are confused about what does and doesn’t apply to them.