SurePrep — 1040SCAN

From the Sept. 2008 Feature on Scan/Fill/Populate Systems

1040SCAN is the most mature digital document organization and auto population system on the market, having been used the past three tax seasons by thousands of professionals. For TY2007, the secure, web-based system and its population features were used to process more than 125,000 returns, and the company expects that number to double next tax season. SurePrep also offers a Lite version of 1040SCAN that offers only scan and organize (no population) features, which is best-suited to users of non-supported tax programs. The vendor also offers domestic outsourced tax preparation services.

The key benefits to 1040SCAN are its population capabilities, which integrate with GoSystem Tax RS, ProSystem fx Tax, and Lacerte to automatically extract data from scanned documents for preparing client 1040 returns. As a part of this process, the system automatically identifies all of the scanned documents and organizes them, then provides the user with a bookmarked PDF file that includes all of the items in an order that follows the flow of the return. This set of electronic workpapers can greatly streamline the review process, with documents easy to find and quickly retrievable. 1040SCAN can identify and extract data from thousands of variations of all 1040-related forms and consolidated statements from more than 70 brokerage entities.

In great part due to its maturity on the market and the fact that the company has more than 200 professional U.S. tax preparers on its staff who help in program development, 1040SCAN provides the most advanced data verification and analysis tools. In fact, SurePrep built a separate diagnostics program focused specifically on classifying documents and identifying potential duplicates or errors. The result is much greater accuracy than simply relying on OCR and can alert users to issues such as data previously entered on an organizer that has also been scanned into the system. The program also offers a series of diagnostic reports.

Operation of 1040SCAN is simple and geared toward non-professional administrative staff who first scan the client documents and upload them to SurePrep’s secure servers, where they are identified, organized and data is extracted for use by the population feature. The next step is completion of the 1040SCAN Review Wizard, a verification process that guides the user (ideally still an admin or intern) through a checklist of potential errors or duplications. The bookmarked PDF is available after this process, and client data can be exported into one of the supported tax systems with just a few mouse clicks. The professional assigned as the preparer is then notified that this client return is in progress and awaiting action.

According to Bret Wier, SurePrep’s VP of Sales and Marketing, optimizing a firm’s workflow is one of the biggest factors in achieving the greatest results from such a system. Additionally, the practice should utilize up-front scanning and data verification and use a high-quality scanner.

“The quality of the scanned images is critical because it affects the ability of the OCR to recognize forms and data contained on them,” he said. “Each year, we stress to our users that having a good scanner is essential, and we often recommend the Fujitsu 6130 with VRS from Kofax. That scanner model costs about $1,100 (from Dell.com), and Wier notes that it is a good fit for firms preparing up to 2,000 client 1040 returns.

1040SCAN also includes numerous workflow management tools, enabling preparers and managers to quickly see the progress of returns assigned to them, and alerting them to when action is required on their part. These tools are especially valuable since they help firms implement more efficient workflow processes that can help save as much as 25 percent of senior reviewer time. 1040SCAN’s list price is $30 per return with a 20 percent early season discount if purchased prior to the end of September 2008.