Small Business Tax Filing Software: Choosing the Right Solution for Your Company

Tax season isn’t anyone’s favorite part of running a small business, but the right tax filing software can mean the difference between a smooth filing experience and hours of frustration. Let's look at what you need to know about small business tax filing software and how the major providers stack up.

What is tax filing software?

Tax filing software helps you prepare and submit your business tax returns electronically. Basic tax preparation tools might help organize financial info throughout the year, but filing software specifically handles the submission of tax forms to the IRS and state agencies.

These platforms guide you through the filing process, automatically calculate tax liability, check for errors, and allow you to e-file directly. Most also handle state returns and calculate estimated taxes.

Key features to look for

When you’re weighing corporate tax software options, certain features matter more than others.

• Business structure support is fundamental. Make sure the software handles your entity type, whether you're a sole proprietor, LLC, partnership, S corp, or C corp.
• Import capabilities save significant time. Look for software that imports data from accounting platforms like QuickBooks, FreshBooks, or Xero. Manual data entry increases errors and eats up hours.
• Error checking and audit support protect you from costly slip-ups. Quality software flags potential issues before you file.
• State filing options matter if you operate in multiple states. Some platforms include state returns, while others charge separately.

TurboTax Business

TurboTax Business handles corporations, partnerships, LLCs, and trusts. Sole proprietors filing Schedule C need TurboTax Self-Employed instead.

The interface uses TurboTax's familiar step-by-step interview format. You answer questions in plain English, and the software determines which forms you need. This works well if you're comfortable with tax concepts but want a guide for the process.

TurboTax Business imports data from QuickBooks seamlessly if you already use Intuit's accounting platform. The software handles multi-state returns, though state filings cost extra beyond the base package.

The main limitation is price. TurboTax Business is more expensive than competitors, especially when you factor in state returns and add-on services. The platform includes free audit support for guidance if the IRS reviews your return, but actual representation requires their more expensive Audit Defense service.

TaxAct Business

TaxAct Business provides corporate tax software at a lower price point than TurboTax while covering the same business structures. TaxAct Business handles C corporations, S corporations, partnerships, and multi-member LLCs. Like TurboTax, sole proprietors use a separate platform, TaxAct Self-Employed.

The interface is more utilitarian than TurboTax's polished design, but it covers all the necessary forms and calculations. Some users find the navigation less intuitive.

Where TaxAct Business stands out is pricing. The software costs significantly less than TurboTax Business, and state returns are often included rather than charged separately. This makes it appealing for businesses watching their bottom line.

TaxAct Business imports data from accounting software, though the range of supported platforms is narrower than TurboTax. If you use less common accounting tools, verify compatibility before purchasing.

H&R Block Premium & Business

H&R Block Premium & Business handles sole proprietorships, partnerships, LLCs, S corporations, and C corporations, making it one of the more comprehensive single packages.

The software offers both interview-based guidance and form-based filing for users who prefer direct form completion.

H&R Block Premium & Business includes unlimited help via chat and phone with tax professionals, which sets it apart from competitors. If you get stuck on a question or need clarification about a deduction, you can get real-time assistance without paying extra.

The platform imports from accounting software, including QuickBooks and Xero. State returns cost extra, similar to TurboTax's model.

One advantage is H&R Block's network of physical offices. If you start with H&R Block Premium & Business and decide you need in-person help, you can transfer your return to a local office and have a tax professional finish it.

Wise Business Could Help Your Company Save on Global Payments

Comparing the options

When comparing TurboTax Business, TaxAct Business, and H&R Block Premium & Business side by side, the differences primarily come down to price, support, and user experience.

TurboTax Business offers the most polished interface and strongest QuickBooks integration, but charges premium prices. TaxAct Business provides solid functionality at the lowest price point. H&R Block Premium & Business splits the difference while offering the most robust support through unlimited professional assistance and in-person backup.

Making your decision

Choosing small business tax filing software isn't about finding the single "best" option but finding the right fit for your situation.

Consider your business structure first. Make sure any corporate tax software you're considering fully supports your entity type and the specific forms you need to file.

Evaluate your comfort level with taxes. If you're confident in your understanding, you might prefer faster navigation and lower costs with TaxAct Business. If you need more guidance, TurboTax Business or H&R Block Premium & Business with robust support justifies a higher price.

Think about your accounting workflow. If you already use QuickBooks, TurboTax Business integrates seamlessly and saves hours of manual data entry.

Factor in the total cost, including state returns, support options, and any add-on services you might need. The advertised base price often doesn't reflect what you'll actually pay.

Save Time and Money On Overseas Payments With Wise Business

Wise Business can help you save big time on international payments.

Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. The Wise Business account is designed with international business in mind, and makes it easy to send, hold, and manage business funds in currencies.

Signing up to Wise Business allows access to BatchTransfer which you can use to pay up to 1000 invoices in one go. This is perfect for small businesses that are managing a global team, saving a ton of time and hassle when making payments.

Some key features of Wise Business include:

• Mid-market rate: Get the mid-market exchange rate with no hidden fees on international transfers

• Global Account: Send money to countries and hold multiple currencies, all in one place. You can also get major currency account details for a one-off fee to receive overseas payments like a local

• Access to BatchTransfer: Pay up to 1000 invoices in one click. Save time, money, and stress when you make 1000 payments in one click with BatchTransfer payments. Access to BatchTransfer is free with a Wise Business account

• Auto-conversions: Don't like the current currency exchange rate? Set your desired rate, and Wise sends the transfer the moment the rate is met

• Free invoicing tool: Generate and send professional invoices

• No minimum balance requirements or monthly fees: US-based businesses can open an account for free. Learn more about fees here

Use Wise Business >>

Making tax season easier for your business

Small business tax filing software has made it possible for businesses to handle their own returns without hiring expensive accountants. TurboTax Business, TaxAct Business, and H&R Block Premium & Business each offer capable solutions with different strengths.

The right choice depends on your business structure, the complexity of your finances, your budget, and how much support you want during the filing process. Take advantage of free trials or demos before committing so you can try before you buy and save a lot of regret down the road.

Sources:

1. Small Business Taxes | TurboTax
2. Business Returns | Tax Act
3. Premium Small Business Software | H&R Block