If you are a small business owner, getting a tax refund for your company is always welcome. However, if you don’t use a tax preparation software for small business, you will have to spend your valuable time preparing and filing taxes instead. That’s why using the best and most comprehensive-compatible tax preparation software for small business is important. This article compares the best free tax software for small business and highlights the benefits they offer.
There’s a lot of tax preparation software for small business on the market. It can be hard to tell which one to choose, especially because some are free, and others have trial periods. If you’re looking for best tax preparation software for small business around, here’s a list of top best tax software solutions.
TurboTax
- Cost$90 or $170 federal, $40 or $50 per state (see breakdown by plan below)
- Mobile appYes
- Live supportYes, costs extra
- Better Business Bureau ratingA+
Terms apply, see below for our methodology.
Pros
- Step-by-step guidance with a Q&A format that is easy to follow
- TurboTax Live provides on-demand advice and a final review from a tax expert or CPA
- Live Full Service has a tax expert prepare, sign and file your return
- 100% accuracy guarantee, or TurboTax will pay your IRS penalties
- Maximum refund guarantee, or TurboTax will refund the plan fees you paid
- Audit support, which provides free assistance if you get an IRS or other tax notice
Cons
- More costly than other software programs
- Live expert assistance plans cost $80 more for federal and $10 more per state
- Live Full Service charges an additional $90 for federal, state is additional
Cost breakdown by plan:
- Self-employed (for personal and business income and expenses): $90 federal, $40 per state
- Live self-employed (includes help from tax experts):$170 federal, $50 per state
H&R Block
- Cost$87.99 or $194.99 federal, $49.99 per state (see breakdown by plan below)
- Mobile appYes
- Live supportYes, costs extra
- Better Business Bureau ratingA+
Terms apply, see below for our methodology.
Pros
- Simple step-by-step guidance that’s easy to follow
- Unlimited on-demand chat or video support with Online Assist plans
- Ability to speak to a tax expert who has an average of 10 years experience (costs extra)
- Over 11,000 physical locations so you can meet with a tax expert in-person
- Maximum refund guarantee, or H&R Block will refund the plan fees you paid
- Audit support guarantee, which provides free assistance if you get an IRS or other tax notice
- 100% accuracy, or H&R Block will reimburse you for any penalties or interest up to $10,000
Cons
- Plans that include speaking with a live tax expert cost $107 more for federal returns
- One of the more costly software programs
Cost breakdown by plan:
- Self-employed (for personal and business income and expenses): $87.99 federal, $44.99 per state per state
- Online Assist Self-employed (includes help from tax experts): $194.99 federal, $49.99 per state
FreeTaxUSA
- Cost$0 federal, $12.95 state
- Mobile appYes
- Tax expert supportYes, costs extra
- Better Business Bureau ratingA+
Terms apply, see below for our methodology.
Pros
- Federal filing is free to use
- Audit defense available with the Deluxe edition, which gives you support from a representative if the IRS audits your federal tax return
- Maximum refund guarantee, or FreeTaxUSA will refund the plan fees you paid and provide a coupon for a free amended tax return
- 100% accuracy, or FreeTaxUSA will reimburse you for any penalties/interest charges
Cons
- Can’t import W-2s, so you have to manually enter the info
- State filing isn’t free, though it’s a low $12.95
- Priority customer support and live chat is only available with a Deluxe edition upgrade and costs $6.99
Liberty Tax
Seen Lady Liberty twirling a sign on a sidewalk recently? That’s Liberty Tax. Like H&R Block, Liberty Tax combines brick-and-mortar storefronts with online offerings—a great perk for new business owners who might want face-to-face help untangling tricky tax situations. Plus, Liberty Tax’s Tax Education School offers online and classroom tax courses. If you’re a brand-new business owner, these courses can help you gain tax know-how to save time and money the next time tax season rolls around.
If you’re self-employed, you’ll need Liberty Tax’s Premium plan, which starts at $44.95 for federal tax filing plus $34.95 per state.
eFile.com
Sure, eFile.com’s low federal filing starting price is a perk—but where the software really soars is in state tax filings. Unlike big-name competitors like H&R Block and TurboTax, eFile.com charges one flat price for unlimited state tax filings.
So how affordable are we talking? Small-business owners should buy the Premium edition, which normally costs $45.99 for federal filings. Unlimited state returns cost $21. With eFile.com, you can’t file a Form 1120 for corporations from the site. If your business is registered as a C corporation, you’ll need a different tax software provider. But smaller businesses score a solid value with eFile.
TaxSlayer
TaxSlayer was founded in the 1990s by local Georgia tax preparation company Rhodes-Murphy & Co. and currently prepares and files over 10 million returns each year. We chose it as the best value of all software reviewed, because it offers the lowest-cost business tax filing plan with support, compared to all the providers we reviewed.
TaxSlayer operates like most other tax prep software, letting users easily import W-2 forms and PDFs of past tax returns regardless of who prepared them. The software then walks the user through the step-by-step process, finding deductions along the way. TaxSlayer also offers phone and email support as needed.
Although TaxSlayer doesn’t offer personal support on par with some of the larger firms we reviewed, users still get a lot for their money. Its Ask a Tax Pro feature lets customers submit tax questions online which are then reviewed by IRS-certified tax professionals who answer with step-by-step guidance. TaxSlayer also offers a 100% accuracy guarantee and maximum refund guarantee, reimbursing its customers for any penalties and interest charges if something gets flagged by the IRS.
Self-Employed Plan
- $54.95 + $39.95 per state filed
- Prepare, print, and e-file
- Student loan interest and education expenses
- Free phone and email support
- Includes all credits like Earned Income Tax Credit and Child Tax Credit
- Includes all deductions and adjustments to income
- Includes all income types, no form or schedule restrictions
- W-2 import and PDF upload
- IRS Audit Assistance for three full years
- Ask a Tax Pro service
- Priority phone and email support
- Live chat
- Unlimited assistance
- Guidance with 1099 income
- Maximize Schedule C work expense deductions
- Quarterly estimated tax payment reminders
- Personalized guide to self-employed taxes
- Year-round tax and income tips
FreeTaxUSA
FreeTaxUSA was founded in 2001 by CPA firm TaxHawk to provide fast and free online tax preparation services. All 150+ employees live and work in the United States and have filed millions of federal tax returns since the company started. We chose it as the best free software because it offers free federal tax filing services.
FreeTaxUSA works similarly to the other software we reviewed and lets users get started by importing their prior-year returns from TurboTax, H&R Block, or TaxAct. Users also get a maximum refund guarantee and a 100% accuracy guarantee with real-time checking as they enter information, double-checking as they complete each section, and a final check before they file their return.
FreeTaxUSA lets small business owners file their federal tax returns absolutely free. State fees are only $14.99 per state filed, which means that business owners in a state where no state tax return is required can still file for free. FreeTaxUSA also offers a deluxe plan for $6.99, which lets users chat directly with specialists, amend tax returns after they’ve been submitted, and access audit specialists who can answer questions in the event of an IRS audit.
As mentioned above, FreeTaxUSA offers free federal filing for business taxes reported on Schedule C.
Self-Employed Plan
- $0 federal + $14.99 per state filed
- Over 350 credits/deductions
- Import from TurboTax, H&R Block, and TaxAct
- Print finished tax returns now or later
- Itemized deductions
- Get credit for donations
- Compare this year’s numbers with last year
- File taxes with self-employed, 1099, or contractor income
- Report income from stocks, bonds, and dividends
- Claim your expenses and rental income
- Get a deduction for Health Savings Account
- Write off the interest paid on student loans
ProConnect Tax Online
If you’re an avid user of QuickBooks Online, you’re probably going to like ProConnect Tax Online. ProConnect Tax Online is designed specifically to serve the tax preparation function for firms centered on QuickBooks Online Accountant. The programs integrate very tightly and can be managed from a single dashboard inside QuickBooks Online Accountant. ProConnect Tax is priced on a pay-per-return basis with no annual fee. QuickBooks Online ProAdvisors can try ProConnect for free and not pay until the return is filed.
Pros
- Cloud-based system eliminates information technology (IT) headaches
- Manage tax returns from your QuickBooks Online dashboard
- No annual license fee
Cons
- Pay-per-return pricing is expensive for high-volume preparers
- No options for unlimited returns
- Cannot customize client letters and invoices
PricingProConnect Tax Pricing
All users must pay per return on a sliding scale based on the total number of returns purchased.
- Business returns: Starts at $117.95 each for the first nine returns and gradually decreases to $59.95 for each return over 200.
- Individual returns: Starts at $94.95 each for the first nine returns and gradually decreases to $47.95 for each return over 200.
Features
Any firm that specializes in QuickBooks Online should give serious consideration to ProConnect Tax, as it provides powerful features such as missing data review and document management. ProConnect Tax also has a K-1 package and a tax planner with the ability to project multiple case scenarios:
- Document management: ProConnect Tax allows you to upload documents, store them, and view them as you do the return, with the option to download forms if desired. You can also customize your requests for tax information, based on the previous year’s information.
- Tax planner: You can plan ahead with your 1040 and Schedule C clients by playing around with comparative tax scenarios. These scenarios include making multiyear comparisons for up to three years and building multiple case scenarios. You can also calculate tax liability and import diagnostics.
- K-1 package: Partnerships, S corporations (S-corps), and fiduciaries can produce letters, K-1 forms, K-1 state forms, and other applicable forms for each individual partner or shareholder.
- E-filing: View the e-file status of all of your clients with a dashboard that allows you to sort, filter, and check for rejections. You can also offer e-signature, which lets your clients review and sign forms from anywhere, on any device.
- Missing data review: ProConnect Tax will flag missing data fields so that you can identify any gaps prior to filing. This streamlines the process of identifying any errors, which will create a faster review time.
Our Expert Opinion
ProConnect Tax is a great companion program for firms specializing in providing client services with QuickBooks Online. It’s powerful software that can prepare returns for forms 1040, 1120, 1120S, 1065, 1041, 990, and 709. However, it can’t prepare form 5500 or form 706 returns. The biggest drawback to ProConnect is the lack of a plan for unlimited returns.
For high-volume preparers, TaxAct Professional might be a better choice. With the low price of $725 for unlimited individual and $1,325 for unlimited individual and business returns, it also allows for unlimited e-filing. It’s an affordable but powerful solution that’s ideal for users that need to prepare a large number of individual and business returns each year.
BlockAdvisors
Who can use BlockAdvisors: General partners and S-Corp owners.
Cost:
- File online with unlimited expert help: $145 and up for federal return; $36.99 per state return.
Pros: BlockAdvisors provides wraparound support for small business owners including tax prep, bookkeeping, and payroll services; this is an advantage if you’re looking for all-in-one financial help, though each service can be purchased individually, including tax prep.
Plenty of help is available if you need it: You have the option to hand off your taxes to an expert (costs will vary) or DIY your taxes online with unlimited help.
Cons: Total filing costs aren’t clear up front, and the starting price is higher than our top choice, TaxAct.
Conclusion:
Pay the government. Pay Uncle Sam. Pay your taxes. It’s what you have to do if you want to keep playing the game. But it sure can be a mystery when trying to decipher which small business tax software is worth the money, and which ones are a waste of time and resources. After reviewing dozens of options – it became clear that some tax programs are so good that they give you your money back! That seems too good to be true…but it’s totally possible with the right tax preparation software for small business.