2018 tax software survey
While professionals in all walks of life are prone to swap views on the relative merits of their tools of the trade, among CPA tax preparers, tax return preparation software generates often extensive and ardent discussion. Return preparers depend on their software to accurately apply U.S. federal and state tax laws, a highly complex procedural and computational task. So the JofA and The Tax Adviser are pleased once again to facilitate and, hopefully, distill this shop talk, with our annual survey of preparers' ratings, likes, and dislikes of their tax preparationsoftware.
We also asked for a third year about clients' tax-related identity theft and saw, for the second year in a row, a sharp decrease in reported incidence of this problem from the 2016 tax season, when it was reported by nearly 60% of respondents (see the sidebar "Taxpayer ID Theft Further Recedes" at bottom of page). And, looking ahead, we asked whether respondents had discussed with clients selected new provisions of the tax reform legislation known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97, learning which were uppermost in CPAs' client communications during the 2018 tax season (see the sidebar "TCJA Provisions Discussed With Clients" at bottom of page).
The survey asked about 13 tax software products, and, as in previous years, seven products garnered significant numbers of responses: ATX (6% of respondents), CCH Axcess Tax (4%), and CCH ProSystem fx (16%), all from Wolters Kluwer; Drake (14%), by Drake Software; Lacerte (17%) and ProSeries (13%), both products of Intuit Inc.; and UltraTax CS (19%), by Thomson Reuters. The remaining approximately 11% of respondents were divided among the remaining six products and write-in entries (1.2%), which are summarized in bonus material. For last year's results, see "2017 Tax Software Survey."
This year, firms of five or fewer practitioners accounted for 74% of users of all products, with 17% in firms of six to 20 practitioners, nearly 6% in firms of 21 to 100, and firms of more than 100 accounting for a little over 3%. The number of sole practitioner respondents was higher than last year by more than six percentage points, which may account for slightly higher shares this year than last of products favored by sole practitioners and small firms (see the table "Favorites by Firm Size"). Among these single-member tax firms, Drake was the predominant major product (nearly 27% of respondents who said they used one of the seven major products), followed by ProSeries (22%), and Lacerte (nearly 16%). Users of UltraTax CS, CCH ProSystem fx, and Lacerte were well-represented among firms of between two and 20 preparers. CCH ProSystem fx was used by a majority of respondents in firms of between 21 and 500 preparers, as was CCH Axcess Tax among the largest firms, those of more than 500 preparers. Read more on the Journal of Accountancy.