2010 Review of Professional Tax Systems (Advanced Workflow)

From the April/May 2010 Issue

As the tax and accounting profession continues to evolve with technology, so too, are we at The CPA Technology Advisor adapting to those changes. In this year’s review of professional tax preparation systems, you’ll notice several significant changes. In his April/May column, Executive Editor Darren Root, CPA.CITP, explains the rationale for these changes, along with the benefits we believe they will provide you, our readers.

TWO CATEGORIES FOR TAX SYSTEMS
While I’ll leave much of the discussion about purpose to Darren, I would like to point out the most notable changes in our reviews. First, we’ve divided the large group of professional tax preparation products into two categories: tax preparation products for traditional workflow practices, and systems designed for firms with more advanced internal workflow needs.

Why did we do this? Because, simply put, what may be a 5-star tax program for one firm may not be for another. And the factors that are most likely to determine what features and functions a practice needs from their tax system generally revolve around the level of complexity in a firm’s workflow structure. It isn’t simply a matter of how complex their client returns may be, although that does influence the complexity level. Nor is it strictly related to a firm’s size or the volume of returns they process.

Only 15 years ago, the most critical assessment of a tax preparation system was in its calculation abilities and whether it could correctly move data from parts of a return or related worksheet/schedule into the proper place. All tax packages are competent in these areas now. Only a decade ago, as “tax compliance suites” were developing, a key concern was in the ability to handle all forms. Well, all of the major tax preparation systems on the market today can pretty much handle any return.

CHANGING WORKFLOW NEEDS & EXPECTATIONS
With the continuing revolution in the way that professional practices manage engagements, we’ve seen movements toward paperless workflow, digital document management, advanced collaboration features, data routing, scan and organize, remote access capabilities, client portals, automatic population and other features. So many of the new key factors in finding the best tax system for a particular firm is in determining what level of complexity that firm experiences, not only in terms of their clients, but also in terms of the workflow processes that take place within the practice.

The end result is that there are firms who expect and demand these dynamic and more technologically advanced workflow functions, and there are firms who don’t expect or have a need for those functions. So we’ve divided the tax systems based on both our view and the vendors’ of the type of practice each program would best be suited for. This will allow us to better compare products in an “apples-to-apples” way, which should provide greater benefit to professionals seeking a new tax compliance system.