Small business owners can prepare their own tax returns for a fraction of the cost of tax professionals as most certified public accountants (CPAs) charge a minimum of $500 for a business return. Below, we’ve identified the best tax software for small businesses based on price, features, and ease of use:
- TaxAct: Best overall small business tax software to prepare corporate and partnership returns
- TurboTax: Best small business tax software for QuickBooks users seeking help from tax pros
- H&R Block: Best inexpensive desktop software for Schedule C businesses
- Block Advisors: Best for having your corporate or partnership business return completed by a tax professional for a low price
- FreeTaxUSA: Best free small business tax software for freelancers with affordable access to tax advice
- BoomTax: Best cloud software for filing year-end information returns like W-2s, 1099s, and 1095s
Best Tax Software for Small Businesses At a Glance
TaxAct: Best Overall Small Business Tax Software
Pros
- Online preparation of Forms 1040, 1120, 1120S, and 1065
- Import income and expense accounts from any software as a comma-separated values (CSV) file
- Save time by importing stock transactions
Cons
- Price includes only one return, so it becomes expensive if you have multiple businesses
- No special cryptocurrency support
- No tax pro assistance for business returns
Online:
- Free: $0 for federal forms plus $39.99 per state return
- Deluxe: $29.99 for federal forms plus $39.99 per state return
- Premier: $39.99 for federal forms plus $39.99 per state return
- Self-Employed: $69.99 for federal forms plus $39.99 per state return
- Partnerships: $139.99 for federal forms plus $54.99 per state return
- S-corps and C-corps: $159.99 for federal forms plus $54.99 per state return
Add-on: Xpert Assist for $59.99 for individual plans to access unlimited help from tax experts.
Desktop:
- Basic: $44.99 for federal forms plus $60 per state return
- Deluxe: $139.99 for federal forms and includes one state return
- Premier: $149.99 for federal forms and includes one state return
- Self-Employed: $159.99 for federal forms and includes one state return
All plans include five federal e-files and free account and technical support.
Bundles:
- Partnership & Home Bundle: $259.99 for Form 1065 federal and state e-files and up to five 1040 federal and state e-files
- S-corporations/C-corporations & Home Bundle: $279.99 for Form 1120 or 1120S federal and state e-files and up to five 1040 federal and state e-files
- Tax-exempt Orgs & Home Bundle: $234.99 for Form 990 federal and state e-files and up to five 1040 federal and state e-files
All plans are available online or as a download, except Tax-exempt Orgs & Home Bundle, which is only available to download.
TaxAct is our overall best tax software for small business owners because you can prepare both individual returns and business returns using its online program. It’s the only software we reviewed that offers online preparation of both individual returns (Form 1040) and business returns (Form 1120, Form 1120S, and Form 1065). It is less expensive than its closest competitor, TurboTax, and it offers useful tools like a tax estimator and tax planner.
Since our last update: TaxAct no longer bundles Xpert Assist with all plans, choosing instead to significantly reduce the price of each plan and let users decide if they want it for an additional $59.99. Xpert Assist allows you to speak with a live tax expert over the phone and request a quick review of your return before filing.
The biggest drawback to the online program is that the price includes only one return, whereas desktop programs can be used for multiple returns. The typical C corporation (C-corp), S corporation (S-corp), or partnership owner will spend anywhere from $259.99 to $279.99 to prepare and file both their individual and business returns using TaxAct. Meanwhile, TurboTax lets you use its desktop software to file business returns with prices that start at $190 for DIY filing, $739 for assisted filing, and $1,749 for full-service filing.
TurboTax: Best Small Business Tax Software for QuickBooks Users Seeking Help From Tax Pros
Pros
- Year-round access to tax pros
- All tax pros are either enrolled agents (EAs), CPAs, or lawyers
- Import cryptocurrency transactions
- Excellent customer support options
Cons
- TurboTax Business is available for download only
- Additional state returns cost $59 to $79 each, depending on type of service
- DIY filing options are more expensive than other similar programs
TurboTax Self-Employed
- DIY: $129 federal and $59 per state
- Live Assisted: $219 Federal and $64 per state
- Full Service: Starting at $389 federal and $79 per state
TurboTax & QuickBooks Self-Employed Bundle: Includes access to both QuickBooks Self-Employed and TurboTax (read our review of QuickBooks Self-Employed)
- QuickBooks Self-Employed Tax Bundle: $30 per month, one state and one federal tax return filing included, pay quarterly estimated taxes directly from QuickBooks
- QuickBooks Self-Employed Live Tax Bundle: $40 per month, includes everything in Self-Employed Tax Bundle plus unlimited CPA advice and a final review of your return
TurboTax Business: Best for C-corps, S-corps, and partnerships
- Business (download only): $190 for federal forms plus $55 per state return, includes five federal e-files
- Live Assisted Business TurboTax Live Assisted Business is only available in select states: Alaska, Arizona, California, Colorado, Florida, Georgia, Illinois, Michigan, Minnesota, North Carolina, Nevada, New York, Ohio, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Virginia, Washington, and Wyoming. : $739 for federal forms plus $64 per state return, includes unlimited expert help
- Full-Service Business TurboTax Full-Service Business covers all 50 states. : $1,749 for federal forms plus $64 per state return, an expert will file your tax returns for you
TurboTax Live is our choice for small businesses, especially QuickBooks users, because of its year-round access to tax professionals. These tax pros aren’t only available to answer questions but also will do a line-by-line review of your tax return. Users can purchase the QuickBooks Self-Employed and TurboTax bundle, which is also available with live tax help and a final review of your tax return. You can also import Schedule C data from QuickBooks Desktop into TurboTax.
This provider is also ideal for users who work with cryptocurrency, as it uses Coinbase to file your cryptocurrency gains and losses. QuickBooks users will also appreciate its ability to transfer financial data quickly to your tax forms.
However, one drawback is that online tax filing is available for Schedule C businesses only—if you are a partnership, C-corp, or S-corp you’ll need to download the software. If online tax filing is important to you, we suggest TaxAct. Live Assisted Business is currently available only in 21 states TurboTax Live Assisted Business is only available in select states: Alaska, Arizona, California, Colorado, Florida, Georgia, Illinois, Michigan, Minnesota, North Carolina, Nevada, New York, Ohio, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Virginia, Washington, and Wyoming. , but Full-Service Business is available in all 50 states. Block Advisors is a good option if you’re seeking affordable access to assisted or full-service help with your business tax return.
H&R Block: Best Inexpensive Desktop Tax Software for Schedule C Businesses
Pros
- Up to five federal e-files included in desktop software
- Import your prior-year return from any tax software
- Free in-person audit support
- Access to tax professionals with all paid online plans
Cons
- Desktop software requires downloading and installation
- No live tax pros with the desktop software
- Return cannot be accessed from a mobile app
- Free tax pro assistance doesn’t include a full review of your return
H&R Block offers pricing for self-employed filing only. Business filers must work with Block Advisors, which is H&R Block’s outsourced bookkeeping and tax service.
Self-Employed Tax Software
- Self-Employed Online: $85, which includes a Schedule C, plus $37 per state return
- Premium & Business Desktop: $89, which includes a Schedule C and one state return
With H&R Block desktop software, you can prepare state and federal returns for Schedule C businesses for a low fee. For just $89, you can use H&R Block Premium and Business to prepare and e-file both your personal federal and state returns (Form 1040) and your Schedule C.
The downside of the desktop software is that it doesn’t include assistance from a live tax professional, which is available with the online program for individuals. If your business operates as a partnership, S-corp, or C-corp, you’ll want to check out Block Advisors, which offers both personalized tax support and the ability to file your return yourself using its desktop software.
Block Advisors: Best for Having Your Business Return Completed By a Tax Professional for a Low Price
Pros
- Service includes free unlimited live expert help
- Access to a financial professional near your home or business
- Ability to tailor a package that includes taxes, bookkeeping, and payroll support
- Import info from other tax preparers or pull directly from prior year’s tax return
Cons
- Block Advisors only compatible with Xero accounting software
- Not able to file unlimited amended returns
- Desktop software not available
- DIY option isn’t available for corporate and partnership returns
- DIY Self-Employed: Starts at $85 for federal tax form including Schedule C plus $37 for each state tax return, includes live expert help and AI Tax Assist
- Full-Service Self-Employed: Starts at $203 for federal tax form including Schedule C plus $70 per state tax return to file with a tax pro
- DIY S-corp, C-corp, and Partnership: Starts at $99, includes one state return
- Full-Service S-corp, C-corp, and Partnership: Starts at $279 to work with a tax pro
- Personalized consultation: $50
- Bookkeeping: Self-serve plan starts at $39 per month, full-service plan starts at $175 per month, and Premium plan starts at $299 per month
- Payroll: Self-employed services starts at $59 per month; Plus plan starts at $79 per month plus $10 per employee per pay run, and Premium plan starts at $140 per month plus $10 per employee per pay run, includes employee benefits and HR assistance
H&R Block is known for its tax preparation services—and it also offers financial support all year round with Block Advisors. Focusing specifically on small businesses and self-employed individuals, it allows you to either partially or fully outsource not only your tax prep but also your bookkeeping and payroll.
Block Advisors is affordable and offers plans for different budgets, depending on how involved you want to be. You can work with your financial expert on the phone or online and can customize a package that will fit your needs. However, Block Advisors lacks a mobile app that lets you file your return as well as check its status, so if this feature is important to you (and you don’t need to file a business tax return), we suggest H&R Block. And if you’re seeking cryptocurrency support, TurboTax is a good option.
FreeTaxUSA: Best Free Small Business Tax Software for Freelancers With Affordable Access to Tax Advice
Pros
- Import your prior return from TurboTax, H&R Block, or TaxAct
- Supports all major individual tax forms for free without the need to upgrade
- Free federal return and inexpensive state returns
- Input data through an interview process, similar to paid programs
Cons
- Cannot import income and expenses or stock transactions
- Customer support options are very limited for free customers
- Doesn’t support partnership or corporate tax return preparation
- Unable to import W-2s or 1099s
Free to file federal Form 1040 individual return with Schedule C plus $14.99 to file each state. Filing prior-year federal returns is also free, and state returns are $17.99 each.
Support Plans:
- Deluxe: $7.99 for priority support with live chat, unlimited amended returns, and audit assist
- Pro Support: $39.99, which includes all Deluxe features plus personal tax advice, access to CPA or EA, phone support, and live screen share.
FreeTaxUSA is ideal for self-employed workers looking for free tax software to file their individual federal tax returns, including Schedule C. It isn’t a scaled-down version of a paid subscription, as it’s a full-featured tax preparation software program that includes all forms that most self-employed taxpayers will need. It also now offers Pro Support for $39.99, which provides tax advice from CPAs and EAs. You can file with help from a pro and receive access to a tax expert via phone support.
However, FreeTaxUSA cannot prepare C-corp, S-corp, or partnership returns. If this is what you’re seeking, we recommend our best overall small business tax software, TaxAct.
BoomTax: Best Cloud Software for Filing Year-end Information Returns Like W-2s, 1099s & 1095s
Pros
- 100% money-back guarantee
- Supports Affordable Care Act (ACA) reporting
- Filing for W-2s and 1099s available
- Import from QuickBooks Online and popular payroll providers like ADP and Sage
- Choice of delivery methods include mail, email, or a batch PDF download
Cons
- Doesn’t support income tax filing
- No desktop software
- No mobile app
- No free trial
Pay-as-you-go for 1099 and W-2 forms: First 12 forms are $39 and then pricing shifts to per form.
ACA filing
- Premium: $349 per company for up to 150 employees, email and phone support, and unlimited corrections; state reporting for Washington, D.C., New Jersey, Rhode Island, and California.
- Enterprise: Custom quote; includes unlimited companies and employees, priority email and phone support, and unlimited corrections.
Optional fees:
- ACA Form Mailing: $1.99 per form
- ACA Form E-Delivery: 30 cents per form
- 1099 Form Mailing: $1.99 per form
- 1099 or W-2 Form E-Delivery: 30 cents per form
- W-2 Form Mailing: $1.99 per form
- TIN Verification Service: $125 per batch
If you don’t want to pay extra for form delivery, you can download the forms as a PDF file and arrange the delivery. BoomTax allows you to file information returns late, but we suggest doing so as soon as possible to minimize penalties.
Although BoomTax doesn’t allow for income tax filing or payroll processing, it’s an affordable and easy way to process 1099s, W-2s, and forms related to ACA filing. Its step-by-step approach allow you to complete forms 1099-NEC, 1099-MISC, 1099-DIV, 1099-INT, 1094-C, 1095-C, 1094-B, and 1095-B. Support for Affordable Care Act (ACA) reporting is available for a flat fee of $349 per company for up to 150 employees for the 2022 tax year. Filing for forms 1099 and W-2 starts at $39 for 12 forms. If you’re seeking inexpensive tax software that can process 1099s and also tax filing for Schedule C businesses, we suggest H&R Block.
How To Choose the Best Small Business Tax Software
When deciding on a business tax software, you should consider the other business systems your small business requires and try to select a combination of software that best fits your needs. To choose the best small business tax software, you need to understand which returns you must file. How your business is organized for tax purposes will determine the required returns to file.
Self-employed taxpayers, sole proprietorships, and freelancers are treated the same for tax purposes. These businesses must report their income on Schedule C of the individual tax return, Form 1040. There’s no separate business tax return.
Related resource:
C-corps must report their business income and tax liability on a corporate tax return, Form 1120. All business income is taxed on the corporate return and has no effect on the individual tax return unless the corporation pays dividends to the owners.
S-corps and partnerships are required to report their business income on a federal tax return filed separately from the owner’s return.
- S-corps must file a Form 1120S
- Partnerships must file a Form 1065
Both Form 1120S and Form 1065 include a Schedule K-1, which shows each owner’s share of the business income. The income on Schedule K-1 is commonly referred to as flow-through income and reported on the owner’s individual return, Form 1040, Schedule E.
A limited liability company (LLC) may be treated as a sole proprietorship, C-corp, S-corp, or partnership.
In addition to federal returns, most individuals and businesses must file state returns. When comparing the cost of small business tax software, be sure to include the cost for all your required returns and note that the software can only produce accurate returns when you enter accurate information. Most small business tax software now includes the option to consult with a live tax professional.
Answering a question incorrectly can have a dramatic effect on a tax return. The more complicated your return, the more important it is that the software provides a tax professional to consult with during the preparation.
The key features you should look for in small business tax software are:
- Cost: Owners of corporations and partnerships generally require at least four returns, and sole proprietors require at least two returns.
- Support for tax forms: The tax software can prepare business entity returns for S-corps (Form 1120S), C-corps (Form 1120), partnerships (Form 1065), sole proprietors (Form 1040, Schedule C), and rental property (Form 1040, Schedule E).
- Data import: Tax software can import data from bookkeeping software and financial institutions.
- Deduction finder: The tax software helps business owners find deductions for their industry and pick the best way to deduct depreciation and car expenses.
- Error checking: The tax software must have diagnostics to check for mistakes and potentially missing data.
- Live tax professionals: Consultation and perhaps even a review by a tax professional is critical for complicated returns. Simply clearing all the issues from the error check doesn’t guarantee the return is correct. Preferably, tax professionals should be either CPAs, EAs, or lawyers, instead of somebody trained by the software provider.
- Ease of use: The tax software must be relatively easy to learn and navigate.
- Customer support and help resources: The tax software must provide an online knowledge base and customer support by phone or email.
Frequently Asked Questions (FAQs)
H&R Block uses its own proprietary software to prepare taxes for both individuals and businesses. It also offers both an online and desktop version of its software for those who want to prepare their own taxes.
TurboTax offers two products to serve small business owners. TurboTax Home & Business is designed for sole proprietors and 1099 contractors, while TurboTax Business helps you prepare taxes for corporations, partnerships, and LLCs.
Yes, you can file a federal tax return for free and state tax returns for $14.99.
The cost of small business tax software can vary depending on the specific software and the features it offers and the forms that you need to file. On average, prices will range from $50 to $200 monthly for a basic software package. More advanced packages with additional features such as real-time collaboration and data import/export capabilities can cost up to $500 or more monthly. Many software providers offer free trials so that you can test out the platform before committing to a purchase.
Common tax write-offs for small businesses include start-up costs, business equipment and supplies, home office expenses, advertising and marketing, travel expenses, legal and professional fees, vehicle expenses, and employee benefits.
Bottom Line
Small business owners should consider their needs carefully when choosing tax software for preparing their business and personal tax returns. If your business is a corporation or partnership, you need software that will prepare Form 1120, 1120S, or 1065—in addition to your personal Form 1040. You want software that will make it easy to transfer your accounting data, maximize your tax deductions, check for errors, provide unlimited customer support, and allow you to consult with a tax professional when you need it.