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Updated Oct 23, 2023

10 Tax Solutions for Small Businesses

Sally Herigstad
Sally Herigstad, Business Operations Insider and Senior Writer

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Entrepreneurs and small business owners often face complicated tax obligations. With so many other duties related to running their companies, tax season can be frustrating and time-consuming as they try to comply with payroll taxes, federal and state income taxes, and excise tax requirements.

Fortunately, tax solutions provide an efficient, do-it-yourself way to prepare and file various taxes without any guesswork. Many tax apps, business tax software solutions, and other tools are specifically created with small business tax needs in mind.

TipTip

Your tax liability is the total amount of taxes you owe to the IRS or another government entity. Reduce your business’s tax liability by staying aware of all business expenses you can deduct from your taxes.

10 small business tax solutions

Consider the following 10 small business tax solutions that can ease a business owner’s tax burdens and create seamless tax preparation and filing processes. 

1. Hurdlr

Hurdlr simplifies business expense and mileage tracking. Proper documentation for every tax deduction helps you keep more of what you earn. Hurdlr simplifies complex record-keeping with a mobile app that uses GPS to track mileage for mileage reimbursement. You can record time, activities, and mileage in a single event with a drag-and-drop calendar. 

This expense-tracking tool even provides real-time personalized feedback on tax savings and other business financial metrics, plus instant tax reporting. With the free version, you get unlimited mileage tracking, income and expense tracking, tax calculations, and the ability to export or email expense reports and other reports. Higher levels add services like real-time calculations for state and self-employment taxes and full double-entry accounting.

2. TaxJar

TaxJar aims to simplify e-commerce sales tax compliance for businesses that sell online and collect sales tax from customers across 11,000 jurisdictions. It offers automated sales tax reporting to take the hassle out of breaking down sales taxes by jurisdiction. It also tells you whether you’ve been collecting the right amount of taxes by comparing the amounts you should have collected versus those in your books. 

TaxJar pulls data from multiple e-commerce channels like Amazon, Shopify, Etsy, Bigcommerce, eBay and PayPal, so you can submit filings and remittances on time. Other features include state-based data for businesses that must file in multiple states and transaction histories to stay compliant in the event of a tax audit. TaxJar plans start at $19 a month for up to 200 transactions.

3. QuickBooks Payroll

QuickBooks Payroll by Intuit makes keeping up with payroll tax regulations easy. It’s automatically updated with the latest tax changes, eliminating the headache of figuring out deductions on your own. Enter the hours worked and pay rate, and the app calculates pay amounts and withholding allowances

Users can also save employee and payroll data, including paycheck histories with payee names, dates and paycheck amounts. 

QuickBooks Payroll starts at $22.50 per month plus $5 per employee per month for the Core level. To learn more, read our in-depth QuickBooks Payroll review

Key TakeawayKey takeaway

Stay on top of small business tax changes to take advantage of favorable tax reforms for small businesses.

4. Payroll Tax Service by Wave

Payroll Tax Service by cloud-based accounting software Wave is a payroll and tax-filing platform designed for small businesses. In addition to payroll services, Wave also helps small business owners comply with tax regulations. 

Wave takes the worry out of when or how to file by automatically paying and filing federal and state payroll taxes. The service also notifies you before taking any action and withdraws funds only when taxes are due. Payroll Tax Service by Wave starts at $40 a month, plus $6 a month per active employee.

5. TurboTax Self-Employed

TurboTax Self-Employed and TurboTax Live Assisted Self-Employed (see below) are all-in-one solutions that help self-employed individuals file taxes and take advantage of the most deductions possible. 

Online software tells small business owners which expenses are tax-deductible and explains industry-specific tax write-offs that are often overlooked. It also takes into account vehicle tax deductions and simplifies asset depreciation to determine which calculation methods benefit you the most in your situation. A wide range of additional tax features is also available. 

TurboTax Self-Employed is currently $89 on the TurboTax website. State tax packages are additional. Free e-file is included.

6. TurboTax Live Assisted Self-Employed

TurboTax Live Assisted Self-Employed offers all the features of TurboTax Self-Employed plus unlimited advice from tax experts. TurboTax Live Assisted Self-Employed is currently $169 on the TurboTax website. State tax packages are additional. Free e-file is included in both packages.

Did You Know?Did you know

Taxes for self-employed individuals can be complex because taxes aren’t automatically deducted from earnings. It’s crucial to understand your tax rate and any state and local taxes that might apply to you.

7. H&R Block Self-Employed

H&R Block Self-Employed is tax software for small business owners, including independent contractors and gig workers. It guides users in preparing and filing partnership and LLC returns (Form 1065). It also produces payroll forms for the IRS (Forms 940 and 941) and employer forms for employees (Forms W-2 and 1099). 

The software helps businesses maximize tax benefits from business expenses, vehicle deductions, and equipment and asset depreciation. It includes free, unlimited state program downloads and business e-file, federal and state forms. H&R Block also guarantees 100 percent accuracy and offers audit support. 

You can download the software for $85 plus $37 per state tax return filed. Unlimited on-demand advice from H&R block tax experts starts at $40 plus an additional state fee. 

8. eTax.com

ETax.com is a tax-filing platform that guarantees maximum deductions and offers free tax return storage. It features a step-by-step wizard that helps users complete tax forms. Its free federal e-filing and free customer support are available seven days a week. 

Although eTax.com is directed more toward individual filers, its $49.95 Premium package includes advanced tax returns for small business Schedule C filers and support from real people. State returns are another $29.95. For $24.95, a review by a tax professional is available to check for common mistakes and to ensure all eligible deductions and credits are applied.

TipTip

Implement helpful tax preparation tips for an easier tax season, such as keeping up-to-date records, using a reputable tax solution, and staying on top of tax law changes and modifications.

9. TaxAct Self-Employed

TaxAct Self-Employed is do-it-yourself, Q&A-based tax preparation and filing software for all types of small businesses, including sole proprietorships, single- and multimember LLCs, and partnerships. 

The software uses a combination of straightforward interview questions and a broad list of expenses to gather information; it then automatically inputs your data into the correct tax forms and maximizes deductions. TaxAct software is free to download or use online. The federal package costs $64.95 for unlimited live tax expert assistance and a price-lock guarantee. State tax packages incur additional costs. Early-bird discounts are available.

10. Avalara AvaTax

Avalara AvaTax provides automated sales tax rates and calculations for businesses with customers in the U.S. and worldwide. Rates are based on hundreds of thousands of taxability rules and precise geolocation in more than 10,000 jurisdictions. 

AvaTax’s cloud-based databases are always accurate and up to date, based on U.S. Postal Service-approved addresses. Wherever your customers are, you’ll automatically get accurate tax rates. 

In addition to sales and use taxes, AvaTax calculates customs and duties amounts, value-added tax (VAT), goods and services tax (GST), communications tax, lodging tax, beverage alcohol tax, and more. AvaTax also lets users generate detailed reports and integrates with a wide range of business apps, such as Salesforce, QuickBooks, Magento, NetSuite, and Sage. Contact Avalara for pricing information.

How to choose the right tax solutions for your business

Choosing the right online tax software can be a challenge. Match your solution to your budget and business requirements. Here are some tips for getting started and evaluating tax software.

  1. Determine your needs. Do you have a payroll? Are your customers local, or spread throughout the country or world? How much help will you need? Consider these and other factors and match your needs to a suitable provider.
  2. Research solutions. Compare the features and pricing of various products you’re considering. Read reviews to get an idea of other customers’ experiences and see what resonates. Find out if the products you’re considering are compatible with systems and solutions you already use.
  3. Consult your tax professional. If you hire a CPA or work with a small business accountant, consider the solutions they work with regularly. Most of the providers on this list work either as do-it-yourself solutions or in coordination with your tax professional.
  4. Sign up for free trial periods or demos. There’s nothing like using a program to see whether or not it works for you. 
Did You Know?Did you know

Check out our guide about how to choose online tax software to find a solution that helps you meet compliance requirements and get bigger refunds.

How tax solutions save time and help you meet your business goals

Today’s tax environment for small businesses has become increasingly complex. The right tax solutions for your business can save you time and frustration and may even offer live advice whenever you need it. Your time can be better spent planning and growing your business than trying to meet your tax obligations and deal with record-keeping, filing and remittances alone. 

Sara Angeles contributed to the reporting and writing in this article.

Sally Herigstad
Sally Herigstad, Business Operations Insider and Senior Writer
Sally Herigstad, an authority on all things finance and taxation, is the author of Help! I Can't Pay My Bills: Surviving a Financial Crisis. As a certified public account, a member of AICPA and a tax software developer, Herigstad has spent decades guiding business owners and others through complex tax laws, debt resolution, financial planning and more. Over the course of her career, Herigstad has served as a subject matter expert for Microsoft's TaxSaver, MSN Money and Microsft Money, and contributed insights and teachings through LendingTree, The Motley Fool, Bankrate, U.S. News & World Report, CreditCards.com, TaxAct and Realtor.com. For CreditCards.com, she spent 10 years helming the "To Her Credit" column, in which she answered reader questions on an assortment of financial matters.
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