Best small business tax software for 2021: for your federal and state taxes
The best tax small business software will make it easier to manage your state and federal tax filings, and ensure you don’t overpay.
However, different tax software packages have different features for different needs, so you need to ensure that you choose the right one to fit yours.
Running a small business means you’re probably got enough to think about already, so having tax software that simplifies various parts of the process should make your life easier. For example, ensuring you’re able to fill in and copy online forms, or file for different schedules, can be immensely helpful for starters.
Additionally, being able to import figures from previous years, or even accounting software, can reduce the workload and keep the process running smoothly.
Whether your a sole proprietor or LLC, the best tax software for your small business will prevent overpayments, and ensure you can claim refunds on expenditure at the state and federal level.
Here then are our options for picking the best SMB tax software.
Best small business tax software at a glance:
- TurboTax
- H&R Block
- TaxSlayer
- Liberty Tax
- eFile
- TaxAct
- FreeTaxUSA
- Jackson Hewitt Online
TurboTax is a very popular choice for small business owners and it’s got a long track record that has helped to hone its impressive feature set. There’s a downloadable dedicated Business package too, which helps you work out the most advantageous tax-saving strategy for your concern.
It also lets you create unlimited W-2, 10
99-MISC, 1099-INT and 1099-DIV forms, prepare tax returns for multiple businesses as well as allowing you to import from QuickBooks. There’s also lots of support available, with CPAs and EAs on hand, which might be particularly useful if you’re new to the tax filing process for small business.
You can also configure a TurboTax package to suit your specific requirements, with the Self-employed package being useful for tackling both personal and business income. Overall, TurboTax is user-friendly and a practical option if you’re going to need some hand-holding along the way.
H&R Block is a great contender in the small business tax software arena in that it comes with an impressive array of tools for tackling more complex issues. As a brand, H&R Block is widely recognized as being one of the oldest suppliers in the business, but it does come at a price. That’s for good reason though, as H&R Block is a potent solution, with small business solutions in the shape of H&am
p;R Block Online, for the self-employed and H&R Block Office for small business.
One of the best things about it, especially if you’re a small business with demanding tax affairs, is that it’s possible to chat things through with specialists as part of the package. Choose from the likes of the H&R Drop-off service, the remote Tax Pro Go or the practical In-Office solution and all bases are covered. H&R has also teamed up with Xero, which means you also get accounting benefits too. Tie everything together and you’ve got a comprehensive solution.
You’ll want to be sure you’re going to make use of all its features if you do go for H&R Block, but it’s certainly got the lot. Packages cover a raft of users, but sole proprietors will want to look at the likes of Premium Online or Self-Employed Online. H&R Block also has new products under the Online Assist banner, that feature on-demand help from a tax expert, enrolled agent, or CPA.
If you work for yourself then TaxSlayer’s Self-Employed package is a popular option as it’s ideally suited for the likes of contractors, 1099ers and other sole proprietors. At the same time, you get quite a good range of features and functions, and all for a reasonable price depending on the current TaxSlayer deal at any given time.
You’ll find TaxSlayer is nicely designed with an intuitive interface, plus there’s the added benefit of audit assistance if required. Considering its relative affordability, being able to talk things through via support is a bonus that adds in more value.
If you’ve got fairly minimal requirements and simple filing affairs to handle then this self-employed package might well fit the bill. Avoid it though if you’re running a business where you’ll need a mor
e comprehensive suite of tools. TaxSlayer’s Self-Employed bundle is good, but it’s certainly not geared up for larger tax tasks.
Liberty Tax is an affordable option for small business owners and is available online in a trio of editions, Basic, Deluxe and Premium, with the Deluxe version being suitable for the self-employed and a Premium package that is better suited to S corporations. Basic is just that, for those with the simplest of tax affairs to sort, so unlikely to be of appeal to SMBs.
It also comes with the back-up appeal of mixing cloud-based tax preparation with on-site options, allowing you to mix and match your filing duties. Functionality is, in the main, fairly spartan without too much in the way of frills, but that’s all that many users want from their business accounting package anyway.
Having the ability of getting help, either online via chat or email, can be mighty useful if you’re not too confident with your filing duties. At the same time, getting someone to check things over in person is even more beneficial in some cases. Liberty Tax also has online and classroom-based tax courses if you really want to get on top of your taxes.
On the downside, customers of Liberty Tax occasionally grumble about some aspects of its usability and less on-the-ball customer support. Nevertheless, if you’re prepared to take on those compromises then Liberty Tax is another option to consider, especially if some face-to-face assistance is likely to be required along the way.
Another option if you’re looking for a simple-but-effective means to tackle your tax is eFile. This online-only option currently comes in three different packages, with a Free Basic being only suitable for standard W-2 income affairs. However, eFile is pretty useful if you’re a self-employed business person.
While eFile isn’t really aimed at, or indeed geared up for larger businesses due to its inability to let you file the corporations Form 1120 using the service, it is also useful for SMBs. Indeed, for businesses there’s the Premium edition, which delivers a speedy calculator-style system that issues useful estimates, plus a support agent to help you through the process.
Going down the eFile route means you’ll probably want to bypass the Deluxe edition and go for that Premium model in order to enjoy all of the benefits of a small business targeted filing system. While eFile has a slightly more light-hearted feel to its approach, generally speaking this is a solid and reasonably-priced option.
The suite of TaxAct products aimed at business are known for being easy to use, fast and affordable too, which is why it’s an ideal solution for many SMBs. Currently, TaxAct Business products allow you to start out for free and then move into a paid-for setup once you’ve decided whether or not it works for your needs.
Sole Proprietor, for example, covers Form 1040, Schedule C, while the Partnership package tackles Form 1065. Meanwhile, C Corporation, Form 1120 and also the S Corporation, Form 1120S bundles deliver the same initial flexibility thanks to a pay-when-you-file approach. There’s a Tax-Exempt Organizations, Form 990 option available too.
Usefully, the TaxAct website helps you work out which package is best suited to your needs and tailors a package to suit. You get a solid, no-nonsense approach, with lots of step-by-step help, the ability to import last year’s returns and other data entry wizardry, plus unlimited free support that adds a lot of value.
FreeTaxUSA might not be the best option to head for if you’ve got more sophisticated small business tax affairs to get sorted, such as Form 1120 for a corporation for example. However, it is worth a look if your tax affairs really are pretty pedestrian as FreeTaxUSA offers basic functionality via a simple-to-use interface.
While there are apparently Simple and Premium options available, small business owners will really need to head straight for the Advanced package to ensure there are enough tools to get the job done. There is a charge for State returns too, so don’t expect a free ride, despite the name. One bonus is the easy import of a prior year return from TurboTax, H&R Block or TaxAct if you’re looking to change.
FreeTaxUSA gets a thumbs up for its Advanced bundle as it comes with assistance for all sorts of business income, with a raft of the major forms all being supported. Beefing up the appeal of FreeTaxUSA is the way the service can carry out real-time monitoring as you enter information, double-check things when you’ve completed a section and then run a final check before you e-file.
The name is already a familiar sight in many physical locations across the US, but Jackson Hewitt Online is a useful extension of the brand that allows filing via the internet. While Jackson Hewitt Online does have its main focus on individual needs, it also caters for small business via its Premier Edition.
Jackson Hewitt Online is certainly an ideal solution for tax filing duties if you require online and real-person advice in order to ensure you’ve covered all bases. The Premier edition is tailored to tackle tax affairs of those with income over $100,000, the self-employed, those with rental property as well as covering itemized deductions along with other income, credits or deductions.
And, even though filing can be done online, the additional edge of Jackson Hewitt is the way that you can combine that with the ability to connect with a tax professional. The Jackson Hewitt Online website suggests its premium-priced package is best for the self-employed and those with complex tax affairs. So, if you want the reassurance of being able to work through all of that with a real person then it’s worth investigating.
