2012 Review of Intuit — Intuit Tax Online

Potential Limitations

• Lacks integration with accounting programs
• Paperless limited to PDF output
• Client portals not offered
• No business management/billing functions

Best Fit: Small tax practices and solo preparers with variable 1040 and business tax return volume, and also seeking mobility of web-based program.

Intuit Tax Online is a web-based professional tax compliance system, providing multi-client management tools, client organizers, PDF file management and integrated banking products. The TY 2011 version has seen continued development and expansion of the system’s capabilities, including the addition of fiduciary returns to those already offered (1040, 1065, 1120 and 1120s). The program also includes diagnostics, network access and client communication tools.

Core Product Functions/Features – 4.5 Stars

As a completely web-based program, Intuit Tax Online requires no installation or startup costs, allowing preparers to get up and running quickly with access to client returns and information from any location where they have internet access. The system offers professional preparation of original and amended individual, fiduciary, partnership, C-Corp and S-Corp returns, compliance for all states and city taxes. It also has extension request forms for each, but does not support preparation of forms 990, 706 or 709. Unlimited e-filing is included with the program.

Intuit Tax Online can be used to file resident and non-resident returns for individuals, and includes calculations for passive activities, AMT, household employment taxes, suspended losses, partial rental ownership, carryovers and other special tax treatments, but does not offer K-1 data import between business and individual returns or a kiddie tax link for form 8615. Intuit Tax Online includes an MFJ/MFS comparison tool and automatically checks for AMT.

The tax preparation system opens into the user’s web browser (Internet Explorer, Firefox, Chrome, Safari and Opera are supported on either Mac or PC computers and devices), with the home page offering a client selection list that groups returns into individuals and business returns. Clients are automatically sorted alphabetically, and a search function is also available. Each client can have multiple returns stored in their folders, either for scenario testing or from prior years, and notes can be added at the top level of returns. The interface also offers links to view the e-file dashboard and transaction histories, as well as help and account and program settings. Management can customize the firm’s profile and user settings, including setting access rights to individual preparers.

Return preparation screens divide tasks into four categories: Enter Data, Review Data, Check Results, and File Return. These areas can be accessed from tabs at the top of the screen, with each providing different menus on the left. The majority of data entry takes place on interview style sheets that follow the layout of a traditional return, with the ability to jump to general information, payments, income, deductions, credits, taxes, other and miscellaneous forms. Although a true form-based entry mode is not available, preparers can quickly view the return in PDF format. When finalizing a return, the system allows a customized cover letter to be included with the PDF.

The Review Data section offers summary results of a client return, and the Check Results tab displays, diagnostics messages, potential data errors and suggestions, with the ability to move directly to those areas of the return. The system allows multiple client returns to be open simultaneously.

Paperless Workflow – 2.25 Stars

Intuit Tax Online can produce printed, mail-ready returns, but the web-based system is primarily designed for electronic filing, with built-in tools for managing and tracking acknowledgements, receipts and other e-filing processes. Prior year returns are stored in the system’s digital client folders indefinitely or until deleted by a user with administrator access rights, and can be printed or produced as a PDF, with the ability to add notes.

The system encrypts all return and client data, and preparers can email encrypted PDF copies directly to clients from within the program. These tools and options provide for a light document management system for returns, but do not provide storage for associated source documents or other files. Although the client returns are online and accessible to firm preparers, Intuit has not developed client-side access capabilities or portals for firm-client collaboration. Likewise, the multi-user capabilities in the program allow any number of firm preparers to access the program from any location, with lockout of returns that are open by other users. The system does not provide preparer or client grouping options.

The program does not offer a scan and populate tool or automated PDF workpaper organization features, such as are available in the ProSeries Tax Import system, which is available to ProSeries users. Those functions allow preparers to scan in client documents in any order, and then receive a set of digital workpapers in bookmarked PDF format, along with the ability to import data from key source documents or directly from financial institutions.

Integration – 1 Star

Prior-year client data is always available and can be rolled into new returns, and new preparer users can have data from other tax systems converted at no cost. Within an individual return, data is automatically calculated and transferred between associated schedules, forms and worksheets, but the system does not share data between separate returns, such as K-1 export or import. The product will not import data from accounting systems (not even from Intuit’s own QuickBooks or spreadsheets for Schedule D transactions.

Intuit Tax Online does not yet offer invoicing functions, a multi-year tax planning option or integrated tax research, although preparers do have access to the Intuit Live Community, where they can discuss issues with other tax professionals. The program does include a basic asset depreciation utility, and this year Intuit developed an iPhone app for accessing key client data. The iPhone app is compatible with the iPad and other tablet devices. The full program, however, is only compatible withother tablet devices with full web browsers.

Help/Support – 4.25 Stars

The system’s help utility includes links to the Live Community, the e-file help center and the Ask Intuit database, which includes topical guidance and tips on many of features of Intuit Tax Online, along with news and video tutorials on how to perform particular tasks. Users can also access information on how to become an e-file provider and explanations of common IRS reject codes.

Live support is U.S.-based and is included free with use of the program, but it is only offered in web-chat format, with hours of 5am to 7pm, Monday through Friday (Pacific Time) and Saturdays from 8am to 3pm. During the last week of tax season the hours are extended until 10pm. Live phone-based support is not offered for Intuit Tax Online. As a web-based system, all program updates are performed by Intuit, with no program maintenance required by the preparer.

Summary & Pricing

Intuit Tax Online is the only web-based system in this year’s review of professional tax compliance systems, and offers the benefits of being able to access it from anywhere and with no initial startup costs. The easy to use and affordable system offers preparation of individual and business entities, plus all states, but because of lack of integration and import options, is best suited to preparers managing mostly less complex 1040 returns.

Intuit Tax Online has no initial fees and the per-return pricing for 1040s can be as low as $8.99 per return when prepaying for a 100-return bundle. A prepaid 50-return bundle costs $9.98 per return, a 20-return bundle is $14.95 per return, and $29.95 if paying for each return individually. Pricing includes the federal form, all related state returns and e-filing. Returns for business entities are as low as $22.45 per return.

2012 Overall Rating: 3 Stars