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Top 6 candidates in the 1041 preparation race.

Article Excerpt
As with most software buying decisions, choosing a 1041 fiduciary tax preparation package requires thoughtful study. Here are four points to consider when comparing the many choices.

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Conversion

Can one vendor's application convert to another vendor's product? Although buying any software application rarely excludes the probability of switching to another supplier at a later date, the year-to-year nature of tax preparation and the pressures of tax season are two good reasons not to change horses in midstream--especially at flood stage! While most suppliers claim their application converts data from another application, the ease and accuracy with which products convert varies considerably.

Expansion

A second factor in choosing an application is its expansion capabilities. Is your business growing, and how much do you expect it to grow? Some suppliers take a modular approach, allowing you to purchase modules as you need them. Adding modules to your basic tax program can make your office more efficient by allowing multiple staff members to work on the same client account, or it may allow for asset management or transition to a paperless office. Of course, depending on cost and other factors, an expandable application may not be a wise buying choice right now.

Technology

Depending on how tech-savvy you are, you may want to look for a Web-enabled application that liberates your preparers from their desks. The accompanying consideration, of course, is how much freedom you want to give them to work outside their offices.

Volume

Finally, consider work volume. The number of fiduciary returns your firm processes is a key deciding factor when selecting an application. If volume is high, it might be wise to choose a solution licensed for unlimited use. If volume is limited, consider a cost-per-return licensing arrangement.

Regardless of the factors that are most important to your buying decision, the applications we've reviewed for you here are excellent candidates in the race to meet your 1041 preparation needs.

Happy tax preparation!

By Glenn Gordon

Move Toward a Paperless Office Using ProSystem fx Tax

ProSystem fx Tax from CCH Tax and Accounting is designed to offer complete tax compliance software for tax professionals in firms of every size. It is part of the ProSystem fx Office suite comprised of 16 separate, but fully integrated applications, for all aspects of tax compliance and planning.

Features

The ProSystem fx Tax applications are extensive, including those for most types of estate and trust returns, split interest trusts, and custodial/agency accounts. Comprehensive state programs work seamlessly with federal data, and a dynamic K-1 import/export spreadsheet link to Microsoft (MS) Excel is standard.

ProSystem fx Tax provides for a variety of distribution options, such as first- and second-tier beneficiary allocations and per-beneficiary distributions. Allocate deductions to classes of income using pro rata to all classes, specific order or specific deductions to specific classes. The program also automatically produces detailed statements supporting all deduction allocations.

While users can file federal returns and most applicable state returns electronically, they also will welcome the application's extensive review and audit tools, including comprehensive diagnostics, worksheets and recap statements for income from pass-through and beneficiary distributions. Complete multi-state processing for non-resident returns include computation of credit for taxes paid to non-resident states.

The tight link to the ProSystem fx Office suite really makes the application shine. Using a built-in, user-friendly wizard, ProSystem fx Engagement stores PDFs of tax returns mirroring physical files in electronic binders. With greater document management capabilities, ProSystem fx Document accesses every document from any location.

Access the ProSystem fx Tax application--with the same functionality--through a CCH Web-based environment called Global fx. Leave returns' data on the CCH server or download it to local storage. Global fx provides a logon to this separately licensed product.

New for the 2005 tax year is the expanded ability to import MS Excel information to worksheets, particularly in interest income and stock sales. A new organizer allows a trustee to more easily gather the information necessary to complete a return.

Other changes include a more intuitive user interface and the ability to include a beneficiary tax information letter in conjunction with a Schedule K-1. Tax information letters are also available for grantors, custodial/agency accounts and non-resident beneficiaries.

Access upgrades on the Internet through a function built into the program or with CD-ROMs CCH sends out periodically.

ProSystemfx Tax offers abundant assistance with learning and using the program. Get an overview using the tutorial built into the program, or look under a specific topic in the help files. Step-by-step guides also are available to guide the user through less commonly used functions like depletion. Delve into more detailed instruction guides available on CD-ROM, or pull up form and worksheet instructions for federal and state returns. For...