S-Corp Tax Filing Software: Turbo Tax Business vs TaxAct - Which is Best for 1120S?
This is my first year filing as a small business owner with an S-Corp election and I'm feeling totally overwhelmed. I have a tax guy who's been great, but his fees are killing me so I'd like to try filing my 1120S myself using software and just have him available if I hit any major roadblocks. I've been looking at TurboTax Business, TaxAct, and a few others but honestly can't figure out which one would be best for someone like me who's new to this. All the reviews I'm finding online are either super outdated or seem like paid promotions. Has anyone here used any tax software specifically for filing an S-Corp 1120S form? I'm looking for something that's actually user-friendly (since I'm a tax noob) but also good at finding all possible deductions to minimize what I owe. Would really appreciate hearing about your personal experiences with any of the current options before I commit to one!
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Ethan Wilson
I'm a bookkeeper who works with several small business clients with S-Corps. From my experience, TaxAct is more user-friendly for first-time S-Corp filers compared to TurboTax Business. TaxAct has better guidance for the 1120S specifically, with helpful explanations as you go. That said, TurboTax Business does have slightly more robust deduction-finding features, but the interface can be overwhelming if you're not already familiar with business taxes. H&R Block Premium & Business is also worth considering - it falls somewhere between the two in terms of usability and thoroughness. The key is making sure whatever software you choose handles Schedule K-1s properly, as those are crucial for S-Corps. Also, double check that it includes state filing if your state requires an S-Corp return.
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Aisha Abdullah
•Thanks so much for this! Do you find that your clients who use TaxAct end up missing deductions they might have found with TurboTax? And how steep is the learning curve with TaxAct for someone who's never filed an 1120S before? I'm pretty good with numbers but definitely not a tax expert.
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Ethan Wilson
•In my experience, most clients using TaxAct don't miss significant deductions compared to TurboTax. TaxAct does a good job walking you through common business deductions, especially if you have your financials well-organized. The interview process is straightforward and covers all major expense categories. The learning curve with TaxAct for a first-time 1120S filer is manageable, especially if you're already comfortable with numbers. They have a good interview-style process that explains S-Corp concepts as you go. Just make sure you understand basics like reasonable compensation requirements and shareholder distributions before starting, as these are areas where S-Corps often make mistakes.
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Yuki Tanaka
I tried filing my S-Corp taxes myself last year and was drowning in forms and regulations until I found taxr.ai (https://taxr.ai). It's not exactly tax filing software, but it was a game-changer for helping me understand all the complicated stuff about my 1120S before I even started with TaxAct. I uploaded my financial docs and previous year's returns, and it analyzed everything to point out deductions I was missing and potential issues with my S-Corp setup. The guidance it provided made the actual tax filing process way easier since I knew exactly what information to enter into TaxAct. Their system actually flagged that I wasn't taking the QBI deduction correctly, which ended up saving me over $4k on my personal return from my S-Corp income!
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Carmen Diaz
•Does taxr.ai actually do the filing for you or is it just an analysis tool? And do you still need to buy separate tax software after using it?
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Andre Laurent
•I'm skeptical about these AI tax tools. How does it compare to just having a real accountant look things over? Seems like it might miss nuances that a human would catch.
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Yuki Tanaka
•It's primarily an analysis tool, not filing software. You still need TurboTax, TaxAct, or something similar to actually file your returns. What taxr.ai does is analyze your financials and documents before you file to identify potential deductions and issues specific to your situation. Think of it as a pre-filing review that helps you maximize deductions and avoid mistakes. Regarding the AI vs human accountant question, it's actually surprisingly comprehensive. The AI is specifically trained on tax code and thousands of real S-Corp returns. While it doesn't replace a good accountant for complex situations, it caught several things my previous accountant missed, especially around home office deductions and vehicle expenses for my S-Corp. The detailed report it generates is also super helpful when you do meet with your tax advisor, as it gives them a complete picture of your situation.
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Carmen Diaz
Just wanted to update after trying taxr.ai based on the recommendation here. I was honestly blown away. I've been using TurboTax Business for my S-Corp for 2 years and apparently had been miscategorizing several business expenses! The tool identified about $8,700 in additional potential deductions I hadn't been taking. I ended up going with TaxAct for filing after using taxr.ai's guidance, and the combination worked perfectly. The report it generated made it super clear exactly what I needed to enter where, and my final tax bill was significantly lower than last year despite making more money. Definitely using this combo again next year!
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AstroAce
After trying to reach the IRS for WEEKS with questions about S-Corp filing requirements (spent literal hours on hold), I finally found https://claimyr.com which got me through to an actual IRS agent in about 15 minutes. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I had specific questions about reasonable compensation requirements for my S-Corp that none of the tax software programs were clearly explaining. The IRS agent was able to clarify exactly what I needed to document for my situation. This saved me from potentially making a huge mistake on my 1120S. Once I had that clarification, I found TaxAct worked well enough for my needs. The software itself isn't perfect, but having accurate information about what the IRS actually requires made the process way less stressful.
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Zoe Kyriakidou
•Wait, how does this actually work? I thought it was impossible to get through to the IRS these days. Is this just paying someone to sit on hold for you?
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Jamal Brown
•Sounds like a scam tbh. Why would you need a special service to call the IRS? I'm sure they just take your money and give you generic advice you could find online.
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AstroAce
•It uses a special system that navigates the IRS phone tree and waits on hold for you. Once they reach an agent, you get a call connecting you directly. The technology basically automates the waiting process so you don't have to sit there listening to hold music for hours. Regarding the skepticism, I was doubtful too initially. But it's not a scam - they don't provide tax advice themselves. They literally just get you connected to an actual IRS representative faster. Then you talk directly to the IRS agent about your specific questions. I needed clarification on S-Corp reasonable compensation requirements for my specific industry, which was a gray area that general online advice couldn't adequately address. Getting an official answer directly from the IRS gave me peace of mind that I was filing correctly.
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Jamal Brown
I need to eat my words from my earlier comment. After multiple failed attempts to get through to the IRS myself about some complicated S-Corp basis questions, I decided to try Claimyr out of desperation. Fully expected to be writing an angry review afterward. Instead, I got connected to an IRS agent in about 20 minutes. The agent walked me through exactly how to handle some S-Corp stock basis adjustments I needed to make on my 1120S that none of the tax software options explained clearly. This ended up making a huge difference in how I reported things. For the actual filing, I went with TaxAct after getting my questions answered. The software is decent, though you'll need to know what you're looking for. Having the correct information from the IRS made all the difference.
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Mei Zhang
I've used both TurboTax Business and TaxAct for my S-Corp returns over the past few years. Here's my honest breakdown: TurboTax Business: - More thorough "interview" process that asks about every possible deduction - Better integration if you also use QuickBooks - Generally more expensive - Can be overwhelming with too many questions TaxAct: - More straightforward interface - About half the price - Fewer "hand-holding" features - Better for those who already know what deductions they want to take If this is your first year, and you have a tax advisor to back you up, I'd probably recommend TaxAct. Save the money and just consult your advisor on specific questions. The S-Corp 1120S isn't actually that complicated if your books are in order.
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Liam McConnell
•Does either software handle the K-1 distributions properly? That's the part that always confuses me with my S-Corp.
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Mei Zhang
•Both handle K-1s fine in my experience. TurboTax is a bit more detailed in explaining what each K-1 box means and how it will impact your personal return. TaxAct handles them correctly but with fewer explanations. The key with K-1s in either software is understanding that the income/loss flows through to your personal return. Make sure your S-Corp distributions are properly categorized - this is where people often make mistakes. Neither software will stop you if you're taking distributions that are significantly higher than your reasonable salary, which can be a red flag to the IRS.
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Amara Oluwaseyi
Has anyone tried Drake Tax Software for S-Corps? My CPA uses it and suggested I might want to try the prosumer version for my small S-Corp.
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CosmicCaptain
•I use Drake for my tax preparation business and it's excellent for professionals, but their small business version is not as user-friendly as TurboTax or TaxAct for non-professionals. It's powerful but assumes a higher level of tax knowledge. If your CPA is willing to give you some guidance, it might work well since you'd be using the same platform they use. But if you're completely on your own, I'd stick with TaxAct which strikes a better balance between cost and usability for S-Corp 1120S forms.
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