Another tax software company bites the dust

[JSLATER]

October 24, 2008
CCH Small Firm Services Acquires IntelliTax

Addition Expands Unit’s Ability to Serve Small Tax and Accounting Professionals

Kennesaw, GA. (October 24, 2008) – CCH Small Firm Services (SFS), part of Wolters Kluwer Tax and Accounting, today announced that it has acquired the tax preparation software company IntelliTax®, formerly known as Orrtax Software Solutions.

SFS provides the ATX™ and TaxWise® lines of tax compliance and accounting software to 45,000 small professional firms in the United States and Puerto Rico. IntelliTax offers tax compliance software to 4,000 similar firms, who will now be offered the TaxWise program for the 2009 tax season.

The acquisition further expands the ability of SFS to serve as a partner to small firm professionals, delivering tax preparation software and services to increase their productivity, efficiency and accuracy. "The acquisition is great news for small tax firms that specialize in individual and business tax services for their clients,” said Jeff Gramlich, SFS President. “SFS already focuses on the type of high-volume electronic filing that is so important to many IntelliTax users. In addition, TaxWise will offer them an even wider range of tax forms and features than they have now.”

“TaxWise is a proven software product,” said Matt Scheuing, President of IntelliTax. “We’re pleased that our customers will benefit from the additional features and services that TaxWise will offer them.”

SFS processed and electronically filed more than 15 million tax returns this year to the Internal Revenue Service (IRS) and state revenue agencies. And for the past 11 years, TaxWise has been the exclusive provider of personal tax software to more than 10,000 IRS-sponsored Volunteers in Tax Assistance (VITA) sites and IRS walk-in offices.

[Snaggletooth]

Better for Orrtax customers

I'm sure Orrtax customers will be happy to know that CCH will now offer Orrtax as well as ATX and TaxWise. The customers will be delighted now that their parent company bolsters its newly-acquired product with superior resources and support.

This IS what's going to happen, right??

[erchess]

Corporate Activity

Maybe it is time to stop or at least limit the habit businesses have of merging with or buying each other. The free transferability of corporate interests (sale of stock) has on balance, I think, been good for the country. But what if we had a rule that pretty much guaranteed that any given firm had to participate in only one industry and could only sell to ten percent of its potential customers? Also what if the wages paid to the highest paid half of employees were not a tax deduction and neither were any payments whatsoever to foreign individuals and corporations?

In other words, yes you can put your tech support call center in India but you will pay for it with taxed dollars. No, you may not buy your competitor because if you did the new entity would control over ten percent of your industry. No you may not buy the company that is not your competitor because the new company would be involved in two industries. Yes you can pay your CEO and board whatever you want at least until we put a cap on someone's total pay for a year, but you will be paying them with taxed dollars.

It is time for a decision. If you really think the largely unregulated economy has been good for most Americans, then stop grousing about the shrinking number of tax software companies and the rising price of tax software. If you think the shrinking number of tax software companies and the rising price of tax software is a problem, then open your eyes to the other problems the almost unregulated market has brought us and vote for politicians who will put in sensible regulations. If there seems to be a shortage of those then run for office or support the candidacy of someone you know. WAKE UP AMERICA!!!!!!!!!!!!!!!

[David1980]

I'm sure Orrtax customers will be happy to know that CCH will now offer Orrtax as well as ATX and TaxWise. The customers will be delighted now that their parent company bolsters its newly-acquired product with superior resources and support.

This IS what's going to happen, right??

No, basically CCH only bought the customers and all the software and other services provided by IntelliTax just died.I'm listed as a customer with IntelliTax and basically this is one sentence from the email received.

For the coming tax season, you will receive TaxWise software instead of IntelliTax at no additional cost.

[Bees Knees]

Snaggletooth was being sarcastic. Of course he knows another software company just got eaten up for its customer list.

As to limiting big company buy outs, many small business (owners) look forward to the day when a big fish comes along and gobbles them up. It’s called cashing in your chips. You worked hard all your life trying to make a buck. Then a big company notices your success and wants to buy your company. You now have the chance to retire at a relatively young age. Are you going to say, no big company. I don’t want your 40 million. You are just going to kill my product so you can create your own monopoly.

Money talks. Of course the employees of the small company now have to find a new job.

[Bees Knees]

It is time for a decision. If you really think the largely unregulated economy has been good for most Americans, then stop grousing about the shrinking number of tax software companies and the rising price of tax software. If you think the shrinking number of tax software companies and the rising price of tax software is a problem, then open your eyes to the other problems the almost unregulated market has brought us and vote for politicians who will put in sensible regulations. If there seems to be a shortage of those then run for office or support the candidacy of someone you know. WAKE UP AMERICA!!!!!!!!!!!!!!!

It has been my experience that regulation does the opposite for small business growth. How many of your Schedule C filers never expanded because of all the hoops they have to jump through just to hire help?

If you want to help small businesses stay in business, patronize them.

[JohnH]

I like Bees' approach. I'm certainly glad my clients like small businesses and want to patronize them, at least with respect to accounting & tax matters - I should be willing to do the same whenever possible.

[Black Bart]

Gosh, E C

...vote for politicians who will put in sensible regulations...

I'd like to, but nobody comes to mind.....

[JohnH]

Reminds me of the story about the lady in the crowd who yelled out to Adlai Stevenson in his 1956 campaign, "Senator, you have the vote of every thinking person." To which he replied, "That's not enough, madam - we need a majority!"

[joanmcq]

Erchess, I think there is already a limit on the deductibility of CEO salaries. Or was that just a proposal I read? I just don't do enough returns for multimillion dollar companies, I guess.

[DTS]

If you want to help small businesses stay in business, patronize them.

When I opened my first business, some older gentleman gave me some good advice, which was "Cultivate relationships and purchase from as many local businesses that you can. They will return the favor".

It works.

[Black Bart]

The Godfather Returns

Making them an offer they can't refuse:

...CCH...has acquired...Orrtax Software...4,000...firms...will now be offered the TaxWise program...

"It's nothing personal; it's just business."

..."The acquisition is great news for small tax firms..."

[Black Bart]

My ATX

I wonder if they plan to eventally axe the X (AT)? It's great software but the management's nuts (i.e., elimination timing of ATX Forum and Maine support staff).

If they do try to make us walk the plank to TaxWise, I'm bailing out, biting the bullet, and going back to Lacerte (yes, yes -- even if it does cost an arm and a leg and they make TurboTax to boot).

Y'know, it's just mind-boggling -- the brass of corporate liars to proclaim "...the acquisition is great news for small tax firms..." when it's plainly, clearly, and obviously terrible news for OrrTax users. As a former ware war (Tasco-Intuit) victim, I've got an idea how they feel about trudging up a steep learning curve during tax season.

[erchess]

Proposal I heard

Erchess, I think there is already a limit on the deductibility of CEO salaries. Or was that just a proposal I read? I just don't do enough returns for multimillion dollar companies, I guess.

The proposal I heard was to cap total pay to anyone in one year at $10 Million. Part of the idea would be that anything beyond that must be deferred, and in the case of CEOs and other key decision makers of a business, conditioned upon the ongoing profitability of the business. I'm not aware of any current limit to the deductibility of CEO Salaries but of course we all know there are limits to both total contributions and deductible contributions to their pension plans.

[Bees Knees]

I'm not aware of any current limit to the deductibility of CEO Salaries but of course we all know there are limits to both total contributions and deductible contributions to their pension plans.

IRC Section 162(m): No deduction is allowed for employee compensation in excess of $1 million for any covered employee of a publicly held corporation. A publicly held corporation is one whose stock is subject to the Securities and Exchange Commission rules. A covered employee is the CEO and his/her top 4 paid executives.