After conducting a thorough review of online tax software, we recommend Drake Tax as the best online tax software for professionals serving small businesses. We chose Drake Tax from dozens of online tax software options. To understand how we chose Drake Tax, you can look at our methodology and a list of online tax software vendors on our best picks page.
Why Drake Tax?
Drake Tax is a thorough, accurate and easy-to-use software application for tax professionals and preparers catering to small- and mid-market clients. Where it really shines is in its customizable reporting, which offers granular insights into every aspect of your practice's operations. Beyond its tax preparation capabilities, Drake Tax incudes a module that serves as a wholesale practice management system, so you can keep a centralized view on the health and efficiency of your business.
Ease of Use and Implementation
Drake Tax is an intuitive, easy-to-navigate system that offers comprehensive support for tax preparers, whether as members of an accounting firm, corporation or nonprofit. It includes all the major forms, prepares gift and estate taxes, offers all state returns, and includes additional applications to manage clients and document transfers.
A major useful feature of Drake Tax is its SecureFile Pro, which allows clients to electronically fill out the required paperwork and return it directly, streamlining the process and cutting out unnecessary hard copies. We also liked that state returns could be prepared directly in Drake Tax as one unified module, without the need to purchase add-ons or additional software.
Drake Tax's soup-to-nuts software includes several useful add-ons for practice management and secure file transfer purposes. It's an affordable solution that doesn't skimp on effective features and can help streamline virtually any tax process. Here's a look at some of the major features that won us over:
- Comprehensive filing: Drake Tax includes support for even the most complicated filers. Primarily useful for small- and mid-market clientele, Drake Tax offers all of the 1040 forms, all federal packages and 48 state packages (plus the District of Columbia), including forms for partnerships, S-corps, C-corps, estates, trusts, tax exempt organizations and more.
- SecureFile Pro: SecureFile Pro is Drake Tax's paperless way of obtaining source documents from clientS for use in the preparation process. This streamlines things on both ends, allowing for seamless communication between client and professional.
- Paperless options: Like SecureFile Pro, Drake Tax features opportunities to reduce the amount of paper needed in the process. Right down to e-signing, Drake Tax enables tax preparers to go green, whether it's collecting source documents, sharing information for revisions, or finally signing and e-filing documents.
- Data import: Easily import your data from QuickBooks or Microsoft Excel, simplifying the implementation process. If you like working in spreadsheets, importing them is straightforward and easy.
- Refund estimator: Like our other best picks, Drake Tax provides a refund estimator throughout the process so you can keep track of issues affecting your clients' refunds and keep clients apprised of your expectations throughout the process.
- Planning tools: Tax planning features help you compare taxes year to year. You can archive old information for personal exploration and also in the event of an audit. Planning tools also include an amortization schedule
- Review tools: We all make mistakes and oversights, but Drake Tax has built-in recommendations to help you avoid IRS rejection. Rejections are costly both in terms of productivity and reputation, so having a little bit of backup is encouraging.
Drake Tax offers two main pricing plans: an Unlimited version that allows for infinite returns (both federal and state) and a Pay per Return program for smaller organizations. We found both to be affordable solutions when compared with other online tax software options for tax preparers. Both packages come with free support and training. Here's a breakdown of the pricing for each product:
- Pay per Return: Pay per Return (PPR) includes 15 federal and state returns for $300 (additional returns are $20 each). If you purchase 85 PPR returns, at that point, your account is converted to the Unlimited plan. PPR includes access to add-ons Drake Tax Planner and Drake Documents, which supports electronic transfer of source documents to reduce paper waste.
- Unlimited: At roughly $1,300, Drake Tax unlimited includes an unlimited number of federal and state returns and supports all tax packages. It also includes DrakeCWU, a client-write up package that covers payroll, bookkeeping, and accounting services; Drake Tax Planner; and Drake Documents.
Drake Tax is often lauded by customers for its excellent customer service and technical support, and it showed when we contacted them. We were immediately taken care of and given the rundown of the entire tax module, even after we specified we weren't interested in making any purchasing decisions at the moment. Customer service staff was informative, and while we weren't able to test out the technical support, it has consistently received high marks from repeat customers.
In addition to a plethora of online resources and help materials, Drake Tax maintains a regularly accessible technical support department. During tax season – from December 2 through April 19 – customer support is available Monday and Friday 8 a.m. to 10 p.m. ET and Saturdays from 8 a.m. to 6 p.m. ET. From April 20 through December 1 (the off season), customer support is available Monday through Friday 8 a.m. to 9 p.m. ET.
DrakeTax doesn't have many drawbacks, but like many immense software applications, there is a learning curve. Drake Tax is user friendly and easily navigated, but it is so in depth that at first it can be difficult to find your way around.
The bottom line is that while Drake Tax is a great solution for accounting firms and mid-market companies, it might be overkill for small businesses with simpler tax needs. For those more common tax situations, consider Intuit Turbo Tax or TaxAct.
Already prepared to choose an online tax software? Here's a breakdown of the rest of our coverage: