Alexis Kestler
As a small or medium business owner, properly managing your taxes can be complex, time-consuming, and prone to errors. Investing in tax planning software can streamline the process through automation, integration, planning tools, and more. This expert guide examines the top tax planning software options to consider for your growing business.
Tax planning is an essential, ongoing process for any successful business. Proper tax management ensures you maximize deductions, avoid penalties and audits, understand your tax liabilities, and keep more profit. However, between changing tax codes, multiple business entities, and tracking expenses, tax compliance can become an overwhelming challenge for SMBs.
This is where tax planning software comes in. The right software solution can automate tax document collection, integrate with your accounting system, project future tax liabilities based on business growth, ensure full compliance, and save you significant time and money.
In this comprehensive guide, you will learn:
- Key benefits of using tax planning software
- What features to look for when choosing tax software
- 10 top-rated tax planning software options for SMBs
- Detailed overviews of each software’s capabilities, integrations, pricing, and ideal users
- Expert advice on selecting and implementing the right tax solution for your growing business
Properly managing your small business taxes does not need to be the dreadful chore it once was. Read on to find the tax planning software that best meets your needs and takes the stress out of tax season.
Benefits of Tax Planning Software
Before examining the top tax planning software solutions, let’s review why SMBs need this type of software in the first place:
Automated tax preparation: Tax software automates much of the number-crunching, form population, e-filing preparation, and more. This saves significant time compared to manual methods.
Accuracy and error reduction: Automation also minimizes costly taxpayer errors. Software flags suspicious deductions, ensures forms are completed properly, and can diagnose issues.
Integration: Many tax planning solutions integrate directly with popular SMB accounting software like QuickBooks. This eliminates duplicate data entry and keeps tax planning numbers in sync.
Tax planning and projections: Quality software moves beyond compliance to help you predict future tax liabilities based on business plans and growth projections. This aids better decision making.
Document management: Cloud-based software centralizes taxpayer documents like bank statements, receipts, payroll records, 1099s, and more in one secure portal for easy access.
E-signature capabilities: Leading solutions support electronic signature collection from clients for e-filing forms, organizing documents, and more.
Support and training: Paid tax software usually includes access to expert support and software training to ensure you use all features correctly.
The right software can save a small business owner dozens of hours each year while minimizing risk and liabilities. Now let’s examine 10 top solutions to consider.
10 Top Tax Planning Software Solutions for SMBs
1. Drake Tax
Drake Tax is a popular tax preparation and planning solution used by over 60,000 accounting professionals. It specializes in automating individual and business tax returns for rapid preparation and e-filing.
Key features:
- Supports individual 1040s plus business returns like 1065, 1120S, 1041
- Robust diagnosis tools spot errors or missing info to prevent rejections
- Tax planner helps visualize how marital/dependent changes impact liability
- Seamless multi-state/city return support
- Integration with Drake Accounting and other practice software
- Bank product program for easy client fee collection
Drake Tax is best suited for tax professionals, CPAs, multi-preparer offices, or individual FILERS looking for DIY tax prep. Pricing starts at $995 per preparer but drops based on volume. Support and training are included along with the ability to add scanned document management. The cloud version includes client collaboration tools.
2. UltraTax CS by Thomson Reuters
UltraTax CS is an end-to-end professional tax solution that automates complex return preparation, planning, calculations, e-filing, and more. It supports individual 1040s and a wide range of business entity returns.
Key features:
- Supports 1040, 1041, 1065, 1120, 1120S, 706 estate tax, and other returns
- Integrates seamlessly with Thomson Reuters bookkeeping solutions
- Multi-monitor support for input forms and previous filings side-by-side
- Diagnostic tools spot errors early
- Multi-state/city return support with auto-linking of entity returns
- eSignature support and virtual office capabilities
Designed for tax professionals and medium to large accounting firms, UltraTax CS is enterprise-grade software with advanced capabilities, analytics, integrations, and scalability. Licensing starts at $2,295 per preparer. Support plans and tax research tools are also available.
3. ProSeries Tax by Intuit
ProSeries Tax is Intuit’s professional-grade solution designed for accountants, enrolled agents, and return preparers. It focuses on automating complex return preparation, planning, e-filing, and practice management.
Key features:
- Supports 1040 individuals returns and all major business entity returns
- Integrated diagnostic tools spot errors early
- Built-in tax planner for visualization and planning
- Bank partner program for easy client payment
- iOS/Android app for managing your return preparation firm
- Integrates with QuickBooks Online Accountant and Lacerte Tax
ProSeries Tax starts at $1,418 per preparer. Support plans, unlimited e-filing, and add-ons like scanned document management are available. Intuit offers flexible payment options. The software best suits tax professionals, multi-preparer firms, or CPAs managing complex tax situations.
4. TaxWise
TaxWise is an end-to-end professional tax solution supporting 1040 individuals returns and all major business entities. It focuses on productivity, automation, speed, and ease-of-use.
Key features:
- Supports 1040 individuals and all business entities
- Specialized features for bilingual filing needs
- Virtual Office suite for cloud access and collaboration
- Integrates with QuickBooks Online Accountant
- TaxWise Mobile app for clients uploading documents
- Document management with integrated eSignature
- Bank Partner Program for easy client fee collection
TaxWise is built to scale from a single preparer up to large, multi-office firms. Pricing starts at $2,100 per office for up to 5 preparers. Support, training, and add-ons like automated workflows are available à la carte based on needs.
5. Canopy Tax
Canopy Tax is a fast-growing professional tax solution built for the cloud. It focuses on intuitive and automated tax preparation, seamless collaboration, unlimited document storage, and real-time progress tracking.
Key features:
- Supports 1040 individuals and all major business entities
- Drag-and-drop simplicity for importing client tax documents
- Automated data import from 400+ forms and documents
- Integrated client collaboration tools
- Custom branding and proposals built-in
- iOS/Android app for managing your business
- Integrations with Hubdoc, QuickBooks Online, Xero, and Bill.com
Canopy Tax starts at $1,080 per preparer annually. It best suits single preparers, small firms, or fast-scaling cloud practices looking for an integrated solution. Support, unlimited training, and e-filings are included along with free client portals and unlimited document storage per client.
6. CCH Axcess Tax
CCH Axcess Tax is a professional-grade tax preparation and compliance solution built by Wolters Kluwer Tax and Accounting. It focuses on productivity, time savings, and IRS audit support.
Key features:
- Supports 1040 individuals and all major business entities
- Precision Tax Editor checks every entry for errors
- Interactive IRS Audit guides for managing correspondence
- Integrated banking solutions for easy client fee collection
- Client collaboration portal with document management
- iOS/Android app for managing your business
- Integrates with Wolters Kluwer and select accounting software
CCH Axcess Tax starts at $1,300 annually per preparer on desktop with discounts for multi-year agreements. Cloud pricing starts higher but scales. Support, IRS Audit Assistance, and add-ons are available based on needs making CCH a scalable solution for firms of all sizes.
7. Lacerte Tax
Owned by Intuit, Lacerte Tax is professional tax preparation software designed for midsized to large CPA and accounting firms. It focuses on automating complex returns for high net-worth individuals and supporting specialty needs like foreign trusts.
Key features:
- Supports 1040 Individuals plus estates, trusts, partnerships, and business returns
- High-Net-Worth add-on for specialty needs like foreign trusts
- Diagnostic tools spot errors early
- K-1 Recipient Management tools
- Integrates with Intuit Practice Management
- iOS/Android app for managing your firm
Lacerte Tax starts at $2,800 annually per preparer. Volume discounts apply along with flexible payments and bundled packages. Lacerte best suits midsized and large CPA/accounting firms supporting high net-worth individuals or specialty needs.
8. Xero Tax
Xero Tax is cloud accounting giant Xero’s integrated tax compliance solution. It simplifies return preparation, planning, document management, payments and more within a single ecosystem.
Key features:
- Federal and state return support
- Automated tax calculations based on Xero accounting data
- Year-round planning tools and projected payments
- Integrated bank payments and billing
- Unlimited storage for client tax documents
- Advisory tools at tax season
Xero Tax is built exclusively for Xero accounting software users and their clients. Subscription pricing is based on the number of tax returns being filed under a single Xero organization subscription. Xero Tax simplifies end-to-end compliance and payments without ever leaving Xero.
9. Intuit Tax Online
Intuit Tax Online (formerly Lacerte Tax Online) is Intuit’s cloud-based professional tax solution designed for midsized CPA and accounting firms. It focuses on automating complex tax preparation, analysis, planning, payments and more within one unified platform.
Key features:
- Supports 1040 Individuals plus estates, trusts, partnerships and business
- Integrates with QuickBooks Online Accountant
- Unlimited e-filings included
- Secure client portal for document uploads
- Diagnostic tools spot errors early
- iOS/Android app for managing your firm
Subscription pricing starts at $35/month per return, billed annually. Volume discounts apply along with accountant focused support resources and onboarding. Intuit Tax Online suits midsized firms and cloud-focused practices looking to manage tax prep in one integrated platform.
10. H&R Block Tax Professional
H&R Block Tax Professional offers H&R Block’s DIY consumer tax filing experience tailored for tax professionals and accounting firms. It combines powerfully simple tax prep software with access to expert tax professionals on-demand.
Key Features:
- Supports 1040 Individuals, Itemized Returns, plus business returns
- Ask a Tax Pro feature staffed by CPAs and EAs
- 100% accuracy guarantee
- Fixed subscription price regardless of return volume
- Integrated bank partner program
- iOS and web access
At $3,000 per year regardless of volume, H&R Block Tax Professional positions itself as an affordable solution for easy tax situations. Supporting documents must be uploaded via a web portal. Additional services can be added a la carte.
Choosing the Right Tax Software
With numerous tax software options now covered, how do you select the right solution for your growing small business? Follow this methodology:
Step 1: Determine Current Needs
Consider factors like:
- What tax entities do you need to file now (1040 Individual? Partnerships? Estates?)
- What is your current tax preparation volume per year? Per preparer?
- How complex are the returns you handle (high net-worth individuals? Specialty needs?)
- What is your budget for tax software? Per preparer? Per year?
Step 2: Estimate Future Needs
Tax software is a long-term investment, so consider potential growth factors like:
- How quickly is your client roster or return volume growing?
- Do you plan to expand into new tax specialty offerings? New geographic markets?
- Are there niche offerings like wealth management or bookkeeping you plan to layer on?
Step 3: Make Your Shortlist
With your must-have features, pricing, and scalability needs defined, make a shortlist of 2-3 potential solutions that warrants further comparison.
Step 4: Schedule Software Demos
Vendors offer free personalized demos showcasing how their software would handle your real client tax scenarios. Take them up on this offer to experience the UI, workflow, integrations and support first-hand.
Making the right professional tax software investment takes time but pays dividends in boosted productivity, reduced risk, saved time and expanded advisory offerings for years to come. Reach out to your shortlist for demos today!
For DIY simple tax filing needs, also review our guide on the best tax software for small businesses.
