Skip to main content

TaxWorks — TaxWorks

From the April/May 2007 Review
of Professional Tax Preparation Systems

TaxWorks offers a full tax suite for mid-sized and smaller firms, providing
comprehensive compliance for all entities for federal, state and municipal compliance
reporting. The system is available in several bundles or as separate modules
and supports multi-state processing. Several additional features are packaged
with the program or are available as add-ons, including fixed asset management,
tax planning, practice management and electronic client organizers. The program
also has integration with banking products. Pricing for the complete “The Works,”
TaxWorks’ most comprehensive package, starts at $2,595 and includes all entities,
all states, and the tax planner in a network-ready system that can be used by
any number of users in the same office at no extra cost. New for 2007, unlimited
e-filing for individual, business and state returns is included in the purchase
price. The company also offers a pay-per-use system. TaxWorks announced in February
that it has been acquired by H&R Block, which will continue to market and
develop the program.

Learning Curve — 4 Stars
TaxWorks is a fairly straightforward program, opening immediately to a master
screen from which the client list or other functions can be easily accessed.
Traditional Windows icons and pull-down menus complement this interface. The
client selection screen opens in a subwindow that allows the user to filter
or search by entity type and sort by various methods, while options for creating
new clients, reviewing, copying and other tasks are available on the side of
this window.

After initially setting up basic client demographic and contact information
in individual returns, TaxWorks offers three interview-based methods of data
entry that provide varying levels of guidance. This is a very nice feature for
both new and experienced users, since it lets more savvy preparers go at their
own speed, but only one interview method is available when working on other
entities. Overall, navigation is generally intuitive and, although a little
hand-holding might be necessary, little training should be required for most

During data entry, a multi-paned interface provides for simplified movement
between forms and schedules by hosting a forms menu on the side, along with
an output view of the form with real-time calculations and a running return
summary, which displays live client data such as AGI, tax due and other information.
The various panels can be resized to the preference of the user. Each of the
data-entry fields that relies upon transferred or calculated data provides links
back to supporting documents, and users have the ability to set notes or mark-ups
to entry fields. The program also includes a non-editable forms view that provides
drilldown access back to the forms.

Use/Workflow & Productivity Tools — 4 Stars
TaxWorks lets users get to client returns quickly, providing a good client selection
screen that displays various information on clients that can be sorted by ID,
name SSN, status and other options. The program also offers various individual
client summary options and simplifies the review process with the various checkmarks
and notes that the system allows users to set to returns. Additionally, user-level
security and an audit trail help to ensure the integrity of returns and identify
which users have accessed or changed data. Diagnostic reports and error checking
of returns also help to ensure the accuracy of forms prior to submission to
the IRS, while the online e-filing system allows users to easily check acknowledgements
and IRS codes from any location.

The program automatically fills in SSI and Medicare withholding for individual
returns, which are overridable, and offers “smart” selection lists for common
entries such as employer, EIN and other data. A ZIP Code database is also included
that automatically fills in city, state and even county and special taxing districts
based on a 5 or 5+4 ZIP. TaxWorks performs all calculations in real-time as
the user enters data and transfers it as needed to other parts of a client return.
TaxWorks includes electronic client organizers, and the Client Management module
includes basic billing functionality plus customizable detailed client invoices,
along with slip sheets, filing instructions, label printing, estimated tax reminder
letters, and a W-4 generator.

Optional components include an appointment scheduler that can integrate with
the system to remind users of client meetings or other tasks, and an asset management
system that offers more than 60 depreciation methods and can perform complex
disposition transactions such as partial and mass dispositions and like-kind
exchanges. The TaxWorks TaxPlanner provides a good basic planning tool that
allows tax professionals to work with their clients to proactively minimize
tax liabilities. It allows up to five simultaneous plans that can be viewed
on-screen side-by-side.

Integration/Import & Export — 3.5 Stars
TaxWorks offers printing straight to PDF, which helps with paperless document
management and also integrates with most e-mail systems to enable users to send
correspondence directly to clients from within the program. The system can import
client data from QuickBooks, other accounting systems and Excel files, and data
within the program flows to dependent returns and state returns as needed. No
integrated research functions are available. The company offers free conversion
from most other tax packages.

Support/Training & Help System — 4 Stars
The built-in assistance tools in TaxWorks offer line-specific assistance and
instructions from right-click menus, while a traditional Help index and user
manual provide additional guidance. The company’s online support center includes
access to the e-file center for tracking returns, as well as tutorials, a knowledgebase
and the reference manual, which is also provided in print. The program also
comes with a customer training video CD. The vendor offers live training
seminars and classes at annual events located in vacation destinations.

Relative Value — 4.5 Stars
The TaxWorks system is strong enough for most firms of any size and, with the
inclusion of unlimited e-filing this year, is priced very competitively. The
system is capable of handling complex returns with K-1 data flowing between
entities as needed as well as tracking and updating of suspended losses for
business entities, but its workflow and review processes make the program more
ideally suited to midsize and smaller tax practices. TaxWorks provides a friendly
user interface that should require little training and includes a good asset
management system, along with basic practice management, planning and scheduling

2007 Overall Rating — 4 Stars