4 Best Tax Softwares for Small Business Owners
Tax software is particularly important for small businesses in tackling complex tax returns—on the state or federal level. Using tax software allows small business owners to prepare their own tax returns for a fraction of what it would cost to hire tax professionals. And we all know how important it is to save a little extra dough when you’re a small business owner, right?
But taxes really aren’t something you want to mess around with. So how do you know which software to trust? Let’s look at some of the best options on the market and then you can decide.
What to consider when choosing DIY business tax software
As the business owner, it’s important that your business structure sets you up for success. You can’t use the same forms for an S-Corp that you can for an LLC, and the same goes for software. You’ve got to be aware of how your business structure plays into your personal returns and go from there.
Also, taxes are much easier to prepare when you’ve got your business expenses in check. Softwares like QuickBooks or FreshBooks are ideal for this. (I’m an S-Corp and I ADORE Wave Financial. Highly recommend.) These accounting softwares allow you to keep track of everything from income to expenses and they typically generate a profit/loss statement for you—without the expense of a human bookkeeper.
Things to look for in your business tax prep software
Before we look at the various types of tax software for small businesses, let us get familiar with the key features of a tax prep software that will help you determine the best one for you:
Supports small business tax forms: It’s essential for the tax software to prepare business entity returns for S-Corps and LLCs, as those are the most common entities for small biz.
Deduction finder: The best tax softwares help businesses find deductions that apply to their industry and also find the best way to deduct expenses for maximum returns.
Data import: Good tax software can import data from accounting software like QuickBooks and Quicken as well as from financial institutions.
Audio Support and Error Check: Mistakes on your taxes could cause you some serious headaches. The right software will have diagnostics to identify mistakes and any missing data.
Human beings: Additionally, your chosen tax software should provide support from a representative in case there are any hiccups in the process.
Ease of Use: The best tax software should be easy for any computer literate person to use and navigate.
Top Tax Softwares For Small Businesses
Regarded as the best tax software by most small business owners, this software is applicable for partnerships, C-Corps, S-Corps, LLCs, trusts, and estates. It enables business owners to import TurboTax returns for the previous year, thereby saving time. It also allows for the importation of accounting data from QuickBooks and does the classification of that data. In case the business owner encounters any difficulties entering the incomes and expenses, this software offers guidance and support regardless of the method of tracking.
Intuit TurboTax business software also helps you capture all your industry-based deductions and business expenses. For new businesses, there is extra guidance on the start-up tax deductions so that your business benefits from the maximum tax savings possible. It also offers extra guidance and support on asset depreciation, enables thousands of error checks, and offers guidance on real estate commercial property activities.
It’s an affordable, yet functional tax software that presents the best solution for single return filings. As such, it is an ideal tax software for small business owners and freelancers who don’t have to worry too much about being audited. With TaxAct, one can easily import the tax returns from the previous year from H+R Block or TurboTax within a short amount of time. Its tax tools include a tax calculator, which give accurate results, leaving less room for error. TaxAct also informs you of your return status to ensure that you file tax returns on time and avoid any penalties.
With this tax software, you can upload a return from other tax services. It also gives a business complete representation in the occurrence of an IRS audit. What’s more, TaxSlayer offers a business a guide to tax reforms, including an exclusive guide to the new tax laws. In this process, they cover calculations, brackets, rates, and deductions.
In terms of their customer support, businesses get unlimited phone calls for assistance. How cool is that? They also support their clients through email and live chat. Whenever you need a one-on-one chat with a representative, their personnel is always willing to help with technical support.
This tax software offers a budget-friendly choice for sole proprietors. Starting from $59.95 for federal and $36.96 for the state tax returns, you can prepare your Form 1040 and other personal forms for your tax returns. It also enables downloading and importing of the Form W-2 wage data from the participating employees. Its deduction finder accurately determines whether you are eligible for deductions and tax credits. Further, this tax software incorporates audit support, which helps business owners know how their audit and tax returns were prepared.
Tax return software can come in handy for small businesses when tax season comes around once again. Most softwares help with the quick retrieval of the previous year’s data, but what you really want to look out for is a software that caters to your business structure and does a good job at maximizing your deductions.
Listen friends, I’m not a tax professional, so be aware that the best tax advice you can get is from your CPA. However, if you’re bootstrapping, there’s a lot you can accomplish with tax software online if you’re an LLC or sole proprietor, so this list should get you pointed in the right direction come tax season.
Meet the Author: Shauna Armitage
Shauna is a Marketing Director or Fractional CMO helping early-stage startups scale with effective strategies, creative solutions, and unparalleled integrity by making the most of small budgets for maximum impact.
As a vocal advocate for women in business, Shauna is on a mission to redefine what it looks like to be a working woman and to support other women doing the same. She spends her free time traveling with her husband and four kids while drinking Coca-Colas. Connect with her on Instagram at @shauna.armitage.