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A mid changes in the federal administration and new tax laws, New York State tax practitioners responding to the 2009 annual survey continue to report that they use the most popular tax software products. Overall ratings for both tax compliance products and tax research resources were very close to those from the 2008 survey, indicating respondents are generally satisfied with tax software. The authors express their appreciation to New York State CPAs for their willingness to contribute to this annual study.
The survey employed an online questionnaire format for the third year, providing an opportunity for a broad range, as well as a large number, of respondents to participate. The current survey asked many of the same questions that have been addressed in previous years, and new questions were added regarding tax software industry trends for the use of document scanning to reduce data-entry time and errors, the implementation of a paperless office environment, and the use of online discussion forums to seek answers to tax compliance or research questions.
The three dominant tax software vendors continue to be CCH, Intuit, and Thomson-each offering multiple tax preparation or tax research products. These vendors' products represent 315 of the 339 (93%) tax preparation and 249 of the 311 (80%) tax research software package ratings provided by this year's survey respondents. Cost has his- torically been a source of dissatisfaction to participants of this survey. One respondent connected the industry consolidation to increases in software costs, commenting that "the software is becoming very expensive as the market shrinks. The increases are very high."
While tax software industry consoli- dation has slowed, a new federal admin- istration and federal legislation have cre- ated other concerns for tax professionals on both sides of the tax software indus- try: The 2009 tax season brought yet another one-year alternative minimum tax (AMT) patch to raise the exemption amount, a first-time home buyer "credit" that was really a loan, confusion over stimulus payment rebates, an additional standard deduction for real estate taxes for individuals who don't itemize, and an extension of the temporary mortgage debt forgiveness exclusion. In addition, tax practitioners had to be concerned about new restrictions on the disclosure of tax- payer information under IRC section 7216 and changes to...