Will there be new, low cost tax prep software?

[BOB W]

Bob W, what software do you use? Do you do mostly 1040s or also businesses? I've been using ATX so am shopping this year, and am leaning toward a package that is powerful for a sole proprietor to get some help with diagnostics, carrying info to two states (CT and NY are common for me), etc.

Lion> sorry I missed your post >>> I use Creative Solution's Ultra Tax> Not cheap but I can count on it for doing a return quickly and correctly. Plenty of diagonostics and other bells & whistles. Get a Demo and play with it.

[George Boutwell]

For the ATX Quirk Collection

I have a client who underpaid his state tax by $400 on an extension request because ATX allowed the credit for taxes paid to other states to be subtracted twice, in determining the amount to be paid by April 17.

I like ATX because it always keeps me on my toes. The minute I assume the software does something correctly, it slaps me in the face and reminds me that human involvement is always necessary.

[Lion]

Bob W

Bob W, what software do you use? Do you do mostly 1040s or also businesses? I've been using ATX so am shopping this year, and am leaning toward a package that is powerful for a sole proprietor to get some help with diagnostics, carrying info to two states (CT and NY are common for me), etc.

[Joe Btfsplk]

Cheap software

No one with a million dollar practice should use cheap software, but someone who does only 100 returns more or less, definitely needs to consider the cost of the software.

Just like efiling--some like it and some don't.

If my clients were constantly being questioned about errors I made, I might need to efile since that would catch some kinds of errors--such as incorrect SSNs.

I rarely make any kind of error that would be caught by efiling. If I leave out some interest or dividends or fail to report a stock sale, efiling would not catch it. On the other hand, if I leave out an EI number efiling would certainly catch it, whereas a paper filed return would not even need the EIN.

The only clients I have that really perceive any extra value in efiling are those who have large refunds--which makes sense and I will efile those kinds of returns at no extra cost to them, since they generally do not job-hop and do not have constanty changing data that won't roll over.

[OldJack]

Why would anybody want "cheap" software. You get what you pay for, and you should not overpay, but get the one that helps you the most and pass the price on to the customers. (Is that a run on sentence?)

Well... I agree for the most part JON, but then it seems like now days to get what you need you pay for a lot of whiz-bang that you don't need or use. Example for me is that ATX-max has always included efile in their price yet I have never efiled. I can't easily switch to TaxAct or TaxSlayerPro since those programs do not offer some forms such as estate tax returns.

I do a low volume 1040 tax work but require most forms that the IRS has to offer as most of my 1040 are large returns such as 15-20 pages. However, most of my tax work comes from business and estate tax classification therefore requiring forms not in the typical cheap software.

So yes... I have to buy more expensive software and pass the cost which makes me twice (or more) expensive than my competition. Therefore, I don't take "cheap" clients and I sell my tax expertise and personal service to justify my fees. The point of this post is that not all tax preparers have the same need for the same type software. Cheap is good if its what you need.

[JON]

Cheap software

Why would anybody want "cheap" software. You get what you pay for, and you should not overpay, but get the one that helps you the most and pass the price on to the customers. (Is that a run on sentence?)

[LawrenceGR]

I'll Chime in

I started last year E-filing all 1040's(before I gave folks an option) here in Mich if you reach a certain volume of returns they all have to be E-Filed or the state charges I don't know how much. Most of my clients like it I just bumped my fee to included the cost.

[sea-tax]

If you don't mind my asking, which program do you use?

Lacerte

[GIMoe]

Program

...at least my program has some diagnostics about efiling and will not let me e-file returns that have issues.

If you don't mind my asking, which program do you use?

[sea-tax]

What is the connection between CP-2000's and e-filing?

George I never said cp-2000 , I said cp whatever letters.

There is no connection that I am aware of , other than by e-filing you have certain recognition that the taxpayer's name or dependant name is correct or social numebr is correct or if you have a new s-corp and you try to e-file it it will give you a rejection if the 2553 was not filed.
Basically as I see it it is one way to help cut down on those IRS letters for stupid things like name changes and the sort. Also it does provide the tax practioner one more form of checks , or at least my program has some diagnostics about efiling and will not let me e-file returns that have issues.

[George Boutwell]

Furthermore being able to recognize a problem instantaneously instead of months if not years later is a major plus. Most of those stupid cp whatever letters seem to always come in the middle to end of tax season.

What is the connection between CP-2000's and e-filing?

[sea-tax]

Well I hate to jump in to this thread in the middle of the battle. But what the heck it has never stopped me before.

I am currently an e-filer. I personally completed over 400 personal returns for 2006. I had 2 EIC's and no most of my clients have at least a sch a coupled with a sch d, sch e, or sch c. Not exactly what I would call the " RAL Crowd".

In my three offices looking at the numbers we e-filed approximately 80% of returns for individuals.


Like I think BOB W said it is a matter of efficiency. We use a high end program that allows for easy use for e-filing and accepting acknowledgements. Coupled with the fact that our practice is migrating to a "paperless office" I think that e-filing is a simple jump.

Furthermore being able to recognize a problem instantaneously instead of months if not years later is a major plus. Most of those stupid cp whatever letters seem to always come in the middle to end of tax season.

[George Boutwell]

You may prefer to save the time it takes to print extra copies and do additional mailing

My printer runs about 20 ppm and the average return runs about ten pages. So by the time I have reviewed and signed the "original", the client copy and my file copy are ready. Half my clients take their returns with them because their returns are completed during their in-office appointment. They may have some additional mailing to do, but I don't.

[Bees Knees]

Your second comment makes me wonder why you didn't cut your fee by $ 35 due to the extensive benefit you obtained by efiling.

People who run their own business have always known that the fee you charge a customer is based in part on the services provided. Increase the quality of the service = an increase in the fee you can charge.

That is basic entrepreneurship 101.

Did you lower your fee when you switched from doing returns by hand to computers? You received a benefit by switching to computers. So why didn’t you lower your fee?

[OldJack]

Good posts Joe!

Its nice to see an open mind analyzing a controversial subject.