Small Business Tax Software

Small business tax software is available from many software companies. The small business absolutely needs to manage its taxes, just as much as it needs to manage revenue and expenses related to its products.

The very first thing a small business owner should decide about when filing his taxes is if he should calculate and file his own taxes, or hire an accounting firm to do it for a fee. The small business should process its taxes if:

  • Resources are limited
  • There is someone on staff that has some accounting knowledge
  • The business transactions aren't overly complicated
  • There is a desire to do your own taxes
  • You've been keeping good accounting records

Good accounting records should be a prerequisite before you try to do your taxes. Invest in accounting software and keep your transactions up-to-date, this is good business. If there are good accounting records, then the numbers you need for your taxes will be at hand.

Good small business tax software can be inexpensive and easy to use. Turbo tax and H&R block software are a couple of the more popular ones. Be sure to get the proper software for your needs though:

  • If your business is a sole proprietorship, then all you need is a home and business type software.
  • If however, you business is a corporation or partnership, you should invest in the more expensive software that is able to handle the needs of these type of businesses.
The tax software will walk the user through each step to filing his taxes. The software is in a question and answer type format. The user just needs to answer the questions by filling in the response boxes. The software fills in the appropriate tax forms and some will even e-file for you.

I've used both Turbo Tax and H&R Block and don't have a preference for either one. They both do a fine job. Once you have used either of these software packages, the information from the prior year will automatically populate into the new year's taxes. This is a tremendous time saver.

And, if you use Turbo Tax this year, you can use H&R Block next year, or vice versa, since the softwares are able to recognize each others information and pull it into their software. Depreciation schedules, investment information, basic setup information, are all pulled in from last year. If you had carried over losses, etc, that is recognized and included in the calculations.