The biggest tax season challenge for a small business is tax preparation and filing. Most SMB owners put off taxes until the last minute. It’s a grave habit if you don’t have professional tax accounting software backing you up. Poor tax planning can end up in paying penalties with accruing interest rates to the IRS. A lesser-discussed problem, conversely, is overpaying your taxes and losing money on miscalculations. Last year an average American overpaid $3,064 in taxes. Over half of small businesses claimed a tax refund, but not everyone can get their money back.
If you want to harness the tax game and avoid losing money, employing tax preparation services may become a turning point in your business. You can start with something simple. First, try to make the most out of your accounting software. As your requests grow, you may feel the need to advance to professional tax prep assistance.
In this article, you’ll find curated reviews of the best tax accounting software solutions on the market. Some of them may even become a lifesaver for your business during the tax season 2021!
Keep reading and learn about how you may benefit.
Ignore bookkeeping throughout the year — and you will find yourself in a tricky place. Poor record-keeping can create problems when it is time to file your taxes. You will not be able to defend tax returns or back your refund claims if audited.
QuickBooks Online will help you calculate estimated tax payments and produce the reports needed to finalize a tax return. Such features make tax preparation less stressful and less expensive. This online accounting service will let you print online 1099s, 1096, and Payroll Tax Forms. You’ll get assistance in listing depreciation if you need to decrease the amount of taxable income.
Accounting service software can do a lot to ease the pain of matching numbers during tax season. But integrating QuickBooksOnline with third-party automation software will bring even more peace of mind. Smart syncing will secure accurate data transfer from payment platforms and allow for quick and error-proof reconciliation. When all books match, there’s more time for sound sleep during tax season!
Free trial: 30 days.
QuickBooks Online prices: from $25 up to $285 per month, including a set of optional add-ons.
Because accounting service software has a record of all the money coming and going from your business, it can run the math for you. Estimating taxes, creating and editing tax returns will feel like a more achievable task.
Xero can even сreate a comparative report against a tax return you filed last year. You can also pre-lodge most types of tax returns from 2018 onwards. This accounting software does sales tax calculations, provided you did a correct job by entering transactions and selecting the tax rate for each line item. As your business is growing, it becomes harder and harder to keep track of the correct data record, especially left alone doing it manually! You might need to connect Xero to professional synchronization software to ensure a flawless import of data. Such solutions automate correct tax, fees, shipping, items, customers, and vendor records where they belong. When the sales data is in the right place, precise tax calculation is a matter of seconds.
Free trial: 30 days.
Xero Prices: from $20 up to $41 per month, including a set of optional add-ons.
If you want your business to be blessed with financial success, there’s no way you can achieve it without keeping financial records in order. Human error can result in mistakes that will attract unwanted IRS scrutiny, which can potentially lead to audits, fees, and other penalties. Synchronizing your accounting software with payment platforms will help you decrease the risk of threatening number disagreements.
Synder is a working tool to import all the transaction data into your books correctly. All taxes, fees, and shipping costs end up in the right places in your accounting system. The service is designed to help detect any unexplained discrepancies. And that’s with just a few clicks setup! Data sync runs automatically in the background, while you’re working on your business and increasing revenue.
Once it’s time to file, you can review what you owe first to make sure all the numbers look good. When all of your required statements are in the right place, the closing of the fiscal year becomes surprisingly gratifying.
Free trial: 10 syncs regardless of the time.
Synder Prices: from $19.99 up to $199.99 per month. You can get a 21% discount if you pay for a year in advance.
Jackson Hewitt Online
Jackson Hewitt Online is big on accuracy and the level of assistance they deliver during your filing duties.
Their library of crucial IRS forms can all be found via the Jackson Hewitt Online site. This tax prep service provides useful calculators to let you pinpoint depreciation costs. Jackson Hewitt Online also offers secure storage and access to your tax returns whenever you need them. Their feature lets you go back as far as six years for no additional charge. It proves to be useful if you face an audit or feel the need to revise your previous tax reports.
Jackson Hewitt Online prices: from $25 up to $249 per month, with state additionals available extra.
TurboTax is suited for diverse online tax filing purposes. It also deals with cryptocurrency, which is quite an appealing feature for start-ups.
Intuit tax preparation software allows you to create unlimited W-2, 1099-MISC, 1099-INT, and 1099-DIV forms. It checks your tax return against a database of over 350 deductions and credits. If you don’t want to wait for your tax refund check to arrive in the mail, you can choose to have it automatically deposited into your bank account. TurboTax also offers a guarantee on all of their tax calculations. The company promises to pay the IRS or state penalties, in case a TurboTax online filing is inaccurate.
Free trial: TurboTax is free until you electronically file taxes online or print a tax return.
TurboTax Prices: from free filing for simple tax returns up to $170, including state additionals.
H&R Block Online
H&R Block’s Online tax filing service supports all kinds of forms. It also assists with the forms that apply specifically to small businesses and self-employed individuals.
This tax prep software will guide you through the tax preparation process with prompts in plain language. Whenever you enter an item incorrectly or place something in the wrong field, the software notifies you of the mistake. If the tax filing program detects any errors, it flags them for you to fix. In addition to common H&R Block’s online tax services, a professional can prepare your taxes for an extra fee.
H&R Block Online prices: from free online tax filing up to $231.98 per month for filing with a tax professional.
FreeTaxUSA will fit a small business looking for cheap but trustworthy online tax filing services. Filing taxes for free with the IRS-approved provider does sound like a compelling offer, right?
FreeTaxUSA can ultimately deal with every state and federal tax filing form, including common credits. It’ll handle all of the main areas required for filing 1099 forms too. Federal taxes are always done for free on this service, and there’s no charge for tax extensions. That’s why it’s considered to be one of the best free tax filing sites available.
FreeTaxUSA prices: from free federal tax filing up to $14.99 per month for state tax returns, with multiple add-ons available on extra fees.
TaxAct provides professional assistance to improve tax planning for your business. It also gives taxpayers access to advice from CPAs and other experts in the field.
This tax preparation online service promises a maximum refund guarantee. It has a glossary of tax terms and a free inspection of your return. TaxAct deals with online tax filing and real-time estimates. It can send the forms directly to the IRS and keep tabs on your e-file status. The software also updates the calculations of your tax refund or the amount you owe in real time.
TaxAct prices: from a free online tax filing to $124.90 per month, including state additionals.
TaxSlayer is a professional online tax filing site with basic functionality for tax preparation and filing. It has a flexible pricing strategy to get full value from its four different packages. It means that you only pay for additional help if you need it.
This online tax service provides personalized tax tips. It sends reminders that are specific to your tax situation, for example, on more ways to receive your refund. It also gives access to new tools that enable faster more efficient online tax filing. Thanks to the ability to speak to a tax professional, you’ll also be able to work smarter and a lot more quickly.
TaxSlayer prices: from free plans up to $79 per month, including state additionals.
eFile is an online tax software focused on simpler tax liabilities. This program lets you do your tax prep online automatically, which is easier and quicker than on paper. But you can also choose to print your tax forms and mail them instead.
This tax preparation site offers live chat support, even during peak hours. When you file taxes online, you can get your tax refund via direct deposit. And you can choose to pay your eFile fees out of the tax refund you get, instead of paying by credit card.
eFile prices: from free online filing up to $78.90 per month, including state additionals.
Sometimes tax season brings lots of unnecessary drama and mayhem in the lives of small business owners. But the drama can be avoided if you’re ready to take the extra step for your tax planning. Small businesses can benefit largely from using tax accounting software honed to cover their tax needs. It provides the tools that are needed to complete tax filing accurately and keep audits at bay.
While some of the online tax filing software is free, other professional services will fly into a pretty penny. If you have demands for more professional features, you’ll need to pay extra. Is this investment worth it? Count all the losses on overpaid taxes, late filing fees, and don’t forget the sleepless nights — you’ll get your answer.