TaxWorks was sold to Thomson Reuters after its rewritten package bombed and similar problems happened with ATX and TRX. Both Intuit and H&R Block had embarrassing glitches with the state of Minnesota warning taxpayers at one point not to use any of Intuit’s software applications for filing either manually or electronically.
Are there lessons to be learned in order to prevent future messes?
”There are lessons to be learned for how we working with the [taxing] agencies,” says Jorge Olavarrieta, group product manager for Intuit who is responsible for Intuit Tax Online. Minnesota, for example, was not just about Intuit problems. The agencies and the tax software publishers both have responsibility for validating forms, especially in a year in which turmoil in Washington compressed their release.
“We need to make sure we are validating together,” says Olavarrieta. “Both parties have some level of responsibility.”
For CCH Small Firm Services, the issues run deeper.
“On ATX, our goal is making sure we have the platform operating at the level the market expects,” says Jason Marx, president of the CCH Unit. Marx says SFS is working to ensure the product for 2013 is stable and operates well in a networked environment. When it comes to the problems with the 2012 software, Marx says, “We need to make sure we know what the root causes are, form a networking and performance perspective.”
Beyond curing last season’s problems, SFS is moving ahead with some important changes, one of those was PortalSafe, developed for CCH by eFileCabinet. It offers customary portal features for publishing and protecting documents that are to be made available to users. SecurePortal integrates with both ATX and TaxWise
SFS has also released a mobile application that provides access to basic capabilities of the tax programs, along with content from CCH’s IntelliConnect research platform. Marx says his group is also enhancing the interoperability of the tax programs with other modules in the product suite, such as the fixed asset manager.
Into the Cloud
For Intuit, the future is the Internet and connected services and the 2013 rendition of Intuit Online has a lot to do with having the company’s web-based applications working more closely.
“You are going to be some of the bringing together of the multiple SaaS applications, primarily QuickBooks Online and Intuit Tax Online,” Olavarietta says. And while there are no announcements on integration with the recently released Intuit Practice Management, another cloud product, it doesn’t take a crystal ball to see that will happen.
For example, Intuit last season tested preparing returns from within QuickBooks Online. “The majority of the data is available within the books and it’s a matter of cleaning of up those books” in order to prepare returns, Olavarietta continues. About 500 returns were prepared this way during the 2012 tax season and the capability will be publicized this year.
Intuit Tax Online will have expanded client and engagement management capabilities, including productivity tools such as K-1 transfers. Since the online tax product is built from the Lacerte code, development has been a matter of deciding how quickly Lacerte features can be implemented in the cloud application.
Getting Axcess
CCH was already in the market with a cloud-based version of its ProSystem fx Tax application. But it recently introduced the Axcess line of Internet-based products with the online tax application moving under that brand.
So the product isn’t new – it was first rolled out to a handful of users in 2008 – but it is now entering a phase with broad marketing support.
“We’ve seen tremendous growth in the number of returns processed over the last couple of year” with Axcess Tax, says product manger Angela Askew.
CCH’s major focus with the Axcess suite is the fact all applications draw from a common database. And that means that when information, such as a name or address, must be changed, it needs to be changed only once, instead of needing to be changed in all relevant applications. The system also has a client dashboard.
One change that hasn’t had an impact yet is the decision to make Axcess an open platform. Other publishers will be able to write applications that can work with the tax program. “There has been some discussion,” says Askew, but it’s too early to the third-party products to make it to market.. Firms, for example, might want to link the tax program with a hosted payroll system, mobile application or CRM
Many changes will apply to both Axcess and ProSystem fx Tax, including the availability of an electronic filing status application for mobile. CCH is also working to add more connections to its IntelliConnect research platform. Also coming are more diagnostics to help understand rejections of electronically filed returns. “Ninety-five percent or more of rejections are due to input errors,” Askew noted. Among those are a major factor is typographical errors in taxpayer names.
Askew says efiling was affected during the last season by the increase in volume over a shorter period, because of the truncated filing season. There are also “many more states coming on board with efiling and many had more forms.”
The Vanishing CD
Changes with Thomson Reuters include a move to sharply curb the number of CDs shipped to practitioners during tax season. With the installation and patching process streamlined, the plan is to have the shipment of CDs only with the initial release.
“You won’t have to install another CD other than this,” says Scott Fleszar, VP of strategic marketing for Thomson Reuters Tax & Accounting. Fleszar said installation of downloaded updates will be more automatic, similar to the updates Microsoft provides for Windows. The system “automatically alerts you when you are going to be updated,” he says.
UltraTax will also provide more features for larger firms, including the ability to administer multiple offices from a central location. “It will support different office designations, different preparers in each office and different data locations,” he says. That means a partner could examine returns for one office or for a single preparer in any office.
PDF creation is also getting fine tuning. Practitioners will have the option to create separate PDF for federal and state returns, and for each partner or shareholder within those returns. In the past, the forms have been published in a single PDF. These can be pushed to a shareholder or partner portal for a taxpayer who might need only a copy of a state return.
Intuit’s Desktop
Despite its move to the cloud, Intuit’s customer base in professional tax preparation remains largely on the desktop with Lacerte and ProSeries
Lacerte users will get the benefit of work with PDF features. Product manager Mary Kroenung said one popular feature from the 2013 tax season was the ability to email password protected PDFs from inside the application.
“We are going to improve PDF creation even more,” says Kroenung. This includes ability to attach PDFs to the 1040 form. There will also be improved password protection so that firms will be able to utilize different levels of passwords, instead of having returns protected by a client password.
The problem with client passwords is that “When you are creating a PDF, it’s based off specific information for that client, part of a Social Security Number EIN and Zip code,” says Kroenung. But other users within the firm might not have ready access to those keys. So there will be levels of passwords that will enable managers and partners access to different for clients.
A major change is Lacerte’s link to the newly launched Intuit Practice Management, an online application. That program has been available in tests over the last two years but has only recently been formally introduced. It integrates with Lacerte and QuickBooks Online.
For ProSeries, Intuit is moving to a download model of delivery. That change is being helped along by “some some significant changes in how our software downloads to make it quicker and easier to download,” says product manager, Julie Kozloski.
Customers who have renewed their purchases for 2013 tax software will be able to download that software in the first week of November.
Kozloski said Intuit has also down some work with PDFs that won’t be visible to end users, but will help Intuit get approval for forms more quickly from state taxing authorities. After the authorities release forms, Intuit modifies them and then must receive approval for those modifications.
“We should be able to turn approvals around faster, so we can get them to the customers,” she says. Preparers will be able to password protect and email PDFs from within ProSeries, a feature already available in Lacerte.
An important feature being added is the ability to lock a return once it has been completed. “That is our most highly requested change,” according to Kozloski.
Getting More Digital
Drake Software is working on the ability to capture signatures electronically with a signature pad.
“The signed copy can be stored and distributed electronically,” says James Stork, VP of strategic development for the Franklin, N.C.-based company. “We have had a number of requests for this.”
Drake is also expanding the release of its Drake Hosted Solution so that the company’s entire application suite will be available in the cloud via Citrix.
“We did a very small pilot of this last year. We had a handful of users that were on it and it went very well,” says Stork. “We are going to expand it quite a bit this year.” Stork said the program will be made available to all who are interested, but in terms of how much it is expanded, “I think it is going to control itself.”
The company plans to improve SecureFile Pro, its system for secure online document transfer. Last season was the second year of full release. “We have quite a few customers utilizing that product to communicate back and forth with their clients,” he says.
Affordable Care
All publishers are facing the issues of the Affordable Care Act and are deciding how to help their professional tax customers, whether through education efforts or tools in the software product itself.
“We are going to be providing a complete range of education options regarding the affordable care act, Stork says. “ We are looking at offering some onsite classes, some webinars” Drake has a selection for “Affordable Care” under the resources tab on its home page.
Information offered includes FAQ sections for employers and taxpayers with the latter including a number of links to government and informational websites. Drake has also provided tools, such as an employer penalty calculator and for taxpayers, credit, credit qualification and penalty calculators.
Thomson Reuters is also developing a workflow for dealing with the Act, which Fleszar describes as a key effort of this year’s software development. TaxWise also has webinars and training sessions rolling out. However, SFS president Jason Marx says that everyone is constrained by the incomplete regulatory framework for Affordable Care.
But his company is getting inquiries from preparers. "They want to get invested to understand what they should be thinking about until there is a tighter framework," he says.
