Now, when things are relatively calm return-wise, is probably a good time to review how last tax season went, where your successes occurred, and where there is room for improvement. One of those areas that deserves scrutiny is your software supplier.
We’re not necessarily advocating changing your tax preparation software and vendor. But many things can change over time, including your needs. Your client mix can also change, adding new clients who need substantially different returns or, heaven forbid, you might lose a client with special requirements and not need as robust a return system.
Massive changes in the Tax Code are another reason to consider a change. How well did your current software handle such things as the Section 199A qualified business deduction and the increasing need for better cybersecurity? And just how satisfied are you with the way your vendor handled any problems you encountered this past season? Was their response time acceptable? Were their support hours comprehensive enough? Many practitioners find that apparent lack of responsiveness is a warning flag that a change might be mandated.
While every new year is a new opportunity to examine your needs and workflows, it’s not necessarily a wake-up call that a change is the best thing for your practice. Before you can make any decision, you really have to sit down and take a closer look at what’s changed in your practice and the direction you see it going. Only then can you look at how well your current applications, including tax prep, are or are not meeting current and future needs.
One common conception is that tax prep software is generic. This is true to some extent. After all, all of the different offerings need to address the major forms and schedules required in 1040 and ancillary returns. But at the same time, vendors often take very different approaches. A glance at
What’s new with vendors
Canopy: New for the upcoming tax season, Canopy is adding to its line of tax professional-oriented software with a full-featured tax preparation application that integrates with its Tax Resolution and Practice Management software. As with every Canopy product, Tax Prep is cloud-based and accessible from anywhere, with no IT resources, servers, or manual software upgrades required.
Drake Software: Drake Software is implementing a number of enhancements in 2020, ranging from new features to improved account security to lessen the chances of identity fraud. Tax professionals will be able to accept credit card payments remotely, collect e-signatures from clients who can’t make it into the office, and send and receive instant messages with SecureFilePro. Drake Tax will now allow Form 4562 imports, and the new optional multi-factor authentication can help tax professionals better secure their accounts.
Intuit: With Intuit Lacerte in the upcoming tax season, users can increase productivity with the ability to add multiple instances of filings (franchise, LLC, etc.) within the same client e-file. The vendor is also adding the ability to use a single e-file wizard to select filings for federal, state, and "other" filings, such as property tax, within the same client e-file. Another upgrade is the ability to sort customer lists with a simple click on any column header, without disrupting the user’s preferred view, as well as the new capability to easily password-protect any client file when using "Print to PDF" and save it to the user’s desktop or share it with a client, without leaving the current workflow.
With Intuit ProSeries, Intuit has improved the Client Letter with the addition of new letters (i.e. engagement, privacy and Spanish letters) and added the ability to print selected letters. Users will be able to collect electronic signatures more easily with signature pad integration. An upgrade will allow a user to work faster with an undo/redo functionality without disrupting the workflow. Finally, new system requirements and security enhancements will let users stay up-to-date to help make sure that the system has the best possible performance and safeguards.
With Intuit ProConnect Online, “Prep for taxes” lets a user seamlessly prepare and file year-end taxes. Users will now be able to clearly see which accounts from the books map to specific tax return line items through the collapse all and expand all capability, and quickly and easily assign and update tax line items in the Tax Mappings view.
Thomson Reuters: For UltraTax CS, to ease preparation and review of the redesigned 1040 return, a new Form 1040 Reconciliation Worksheet was added which combines information on the new 1040 return with the look of the more familiar, traditional Form 1040. Given the change in tax brackets, a new “Reconciliation of Marginal Tax Rates” was added to the Two-Year Comparison Report to compare taxpayers’ taxable income and marginal tax rates year over year. Comprehensive QBI calculations, diagnostics, and worksheets have been added to support Section 199A, while new Schedule K-1 QBI amounts are now included in the automatic data share of Schedule K-1s. To aid in identifying and communicating with clients affected by Section 199A and other TCJA provisions, numerous pre-built data-mining searches and letters were added. Security enhancements include increased encryption-levels on PDF files generated out of the system, as well as a convenient warning message to the user prior to the automatic timeout period.
For GoSystem Tax RS, a new and improved fully web-based client organizer was added for all return types that can be utilized without any desktop footprint or install. This new organizer also offers a version that redacts personal information to prevent taxpayer fraud, and tracks an audit trail or history of events. Several new data import/export templates have been added for efficiency in entering certain items such as: assets, capital gain amounts, Schedule K-1 amounts, and PFIC amounts. To aid in tracking return statuses, a new paper filed option can be selected in the e-file status window. A new “Print Requirements” report was added to assist in identifying values needed to produce or omit certain tax forms. A new QBI cost basis schedule and detailed QBI statements per activity have been added.
Wolters Kluwer Tax Solutions: New with CCH Axcess Tax Suite is the introduction of CCH Axcess Financial Prep, a cloud-based trial balance solution for preparation engagements. CCH Axcess Financial Prep eliminates the manual process of grouping accounts and removes duplication efforts in managing clients. Client data can flow directly to CCH Axcess Financial Prep, removing the need for manual import/export and instantly producing accurate balances. It recently added integration with Xero. The new CCH Axcess iQ expert solution takes regulatory and legislative events and matches them with specific client portfolios in accounting firms, so that accountants can proactively advise their client. In addition, multi-factor authentication was implemented and new diagnostics were added to accommodate the “10 Business Day Rule.” Finally, as a result of the Tax Cuts and Jobs Act, hundreds of new federal/state forms, such as the Section 199A qualified business deduction, are now included.
For CCH® ProSystem fx® Suite, MFA was implemented as an added security measure. Also, new diagnostics and the Electronic Filing Status System were added to accommodate the “10 Business Day Rule.” And a filter option was included to show returns with states that will expire based on the number of business days remaining. In addition, as a result of the TCJA, hundreds of new federal and state forms were added. New electronic filing states for 1040 and business returns were developed as well.
With TaxWise, the TaxWise Online mobile app is planned for launch later this year to provide firms with a remote taxpayer data collection tool. The mobile solution will allow a firm’s clients to securely populate their tax data from the comfort of their own home and snap photos of key documents with secure upload functionality.
