Kelley Rating (one asterisk = lowest, to five asterisks = highest):
- Ease of navigation, design of interface and learning curve *****
- Instructional documentation and help system ****
- Carries out the goal of the product as represented ****
- Overall usefulness ****
Denver Tax Software offers a number of Windows-based, dedicated programs that provide calculations for specific tax and tax-planning issues, including those relating to entity selection and retirement planning.
What’s It All About?
The publisher’s programs that address areas of interest to trust and estate practitioners include:
(1) The 2013 Quarter 4 IRS/State Interest & Penalty Calculator, which computes interest on underpaid or overpaid taxes and Federal penalties, including failure to pay, failure to file and accuracy related penalties. Internal Revenue Service interest rates and interest rate factors through December 31, 2013 are included. The program currently supports interest rates for AR, CA, FL, GA, MA, MO, ID, KY, SC, LA, MD, MN, UT, VT, V, VA, IL, MI and PA. Since timing is uncertain as to the release of state interest rates, the publisher provides a web page displaying the status of state rates and update state rate files for the program. The publisher also provides individual calculations on request.
(2) The 2012 S Corp Vs. Partnership/LLC/Sole Proprietorship Analyzer, whichaddresses many factors to help you determine whether an entity should be an S corporation, an LLC, a partnership or a sole proprietorship. The program makes tax projections for each owner, including both the employer's and employee's FICA and self-employment tax. For each owner, it constructs a tax projection for the business entity as an S corporation and a separate projection for the business as a Partnership/LLC/Sole Proprietorship. Sample reports are available.
(3) The 2012 C Corp Vs. S Corp Analyzer, which compares both corporate and individual stockholder tax projections for S and C corporations. Its summary report displays the amount by which the combined business and shareholder tax results vary in the respective corporate solutions.
The publisher is currently updating the Corp Vs. Partnership/LLC/Sole Proprietorship Analyzer and the C Corp Vs. S Corp Analyzer programs for the tax act related to the fiscal cliff problem. The 2012 versions of those programs are currently available.
(4) The 2005 IRA/Pension Distribution Planner, which determines the required minimum distribution for a taxpayer over age 70½ and determines penalty free pre-age 59 1/2 distributions under Section 72(t). It also addresses inherited IRAs or pension plans. The reports show the derivation of the life expectancy amount. A report is also available that projects how the distributions should change over time. The program addresses all combinations of beneficiaries, including minimum distribution incidental benefit (MDIB) situations.
(5) The 2011.10 Roth Vs. Traditional IRA Calculator, which uses time value of money concepts to compare a Roth IRA with a traditional IRA. It analyzes the consequences of spreading, or not spreading, the rollover tax over 2011 & 2012 and paying for the rollover tax from IRA funds. It also determines how much should be retained in the IRA and the consequences of rolling over nondeductible IRA funds and taking distributions either in fixed dollar amounts or for a fixed number of years. It compares taking distributions from a traditional IRA, but taking no distributions from the Roth IRA, and having different tax rates for pre- and post-retirement. The program also considers the tax consequences after death, including IRD issues. Sample reports are available.
(6) The Education Funding Planner, which determines how much clients need to pay and how much they save with an Education IRA or 529 Plan and determines whether the plan is better than the traditional option of funding education by giving gifts in the child’s name. It demonstrates the savings available in an Education IRA or 529 Plan. To provide a sound comparison, the program includes the present value of the payments. Consultation is available from the publisher for education funding analyses.
(7) The Social Security Calculator, which provides a report for presentation to your clients, including 2013 factors, with projected benefits for the following ages:
- The earliest Social Security retirement year, currently 62.
- The first retirement year, currently 70, where Social Security benefits aren’t reduced for working.
- The Normal retirement year, currently 66, or any other retirement year.
(8) The 2011 AT&T Divestiture Basis Tracker, which computes the cost basis for the "AT&T Family," and also computes the number of shares that should be owned on a specific date. This program addresses income tax compliance, but may be helpful for estate issues, as well. It computes the current tax cost basis and number of shares owned of AT&T, the "Baby Bells" and all securities that were spun off from them. The program automatically makes computations for all mergers, acquisitions, spin-offs, stock splits, stock dividends and the AT&T Divestiture. Computations in this area are also provided, on a consulting basis, by the publisher.
The publisher also offers a guide on How to Setup a “Paperless” Office for $89.
How Does It Work?
The Denver Tax Software programs first appear with a blank screen with a simple top menu bar that allows you to open a new instance or retrieve a saved instance. When you initiate a new computation, a simple input screen appears for the initial data. Other inputs from the dropdown input menu may be required. Another dropdown menu offers options unique to the calculation being made. After all inputs are entered, you may click on View/Reports, or on a Reports icon, to view the results. A dialog box then appears offering report choices. The selection you make may be viewed or printed.
One example is the Interest and Penalty Calculator, which proceeds as follows:
- At the Initial Inputs screen, input the start and end dates of the calculation, identify whether the taxpayer is corporate, select computation of overpayment or underpayment, enter the due date of the return and initial balance, identify whether you are working with a payroll tax and select a Rate Table (federal or a named state).
- From the dropdown menu Inputs, enter Other Charges and Payments that have been made by amount and date.
- From the Inputs menu at Penalties, select the types of penalties that might apply and specify the required information for the selected penalty. (Penalty computations for states are available only where the penalty for the state can be computed using federal law.)
- At Options/Interest Rates, you may select other rates, such as tax-motivated rates or large corporation rates. At Options/Suspend Interest, you may enter the date range for a period when interest is suspended.
- At View/Reports, you may then select and print the report that you desire, including inputs, summary report, detailed analysis and penalties for failure to file, accuracy related penalties or payroll deposit penalties.
What About Help and Support?
Detailed PDF Guides are available for each program. You can also get help on any screen, or input, you are working on by pressing the F1key. Technical support and training in the use of the programs is available by phone. YouTube example explanations are available for the IRS/State Interest and Penalty program. The pages for individual programs on the Denver Tax Software website also offer news that affects planning and calculations in the program area.
How Do You Contact the Publisher?
The pricing for Denver Tax Software products for a single machine is (discounted prices were offered on orders before Sept. 14, 2013):
IRS/State Interest & Penalty Calculator -- $169 ($149)—sold as an annual subscription, including quarterly updates (furnished by mail or email) through the third quarter of 2014.
S Corp Vs. Partnership/LLC/Sole Proprietorship Analyzer—$149 ($129)
C Corp Vs. S Corp Analyzer—$149 ($129)
IRA/Pension Distribution Planner—$199 ($149)
Roth Vs. Traditional IRA Calculator—$149 ($119)
Education Funding Planner —$119 ($65)
Social Security Calculator—$149 ($129)
AT&T Divestiture Basis Tracker—$79 for a single machine, plus $25 for networks
For operation on networks, an additional $25 is added.
An Economy Pack on CD is available for $276.00 for a single machine. It saves $515 from the total individual price of the IRS/State Interest & Penalty Calculator, Education Funding Planner, Lease Vs Buy Analyzer, Social Security Retirement Benefits Planner, Employee Auto Compensation Analyzer, Like-Kind Exchange Vs. Sale Analyzer.
Free demos are available for each product.
Contact information:
Voice: (800) 326-6686 (Toll-free)
Voice: (303) 796-7780 (in Colorado)
FAX: (303) 796-7768
E-mail: [email protected]
Mail: P.O. Box 632285
Littleton, CO 80163-2285
Website: http://denvertax.com/shopsite_sc/store/html/index.html
Bottom Line
The Denver Tax Software products provide useful, well-thought-out and accurate calculations and reports for a number of specific situations encountered in the trusts and estates practice.
Trusts & Estates magazine is pleased to present the monthly Technology Review by Donald H. Kelley—a respected connoisseur of the software and Internet resources wealth management advisors use to further their practices.
Kelley is a lawyer living in Highlands Ranch, Colo. and is of counsel to the law firm of Kelley, Scritsmier & Byrne, P.C. of North Platte, Neb. He is the co-author of the Intuitive Estate Planner Software, (Thomson Reuters 2004), Estate Planning for Farmers and Ranchers (Thomson Reuters (2002-2013) and Family Business Organizations (Thomson Reuters 2008-2013). He has served on the governing boards of the American Bar Association Real Property Probate and Trust Section and the American College of Tax Counsel. He is a past regent and past chair of the Committee on Technology in the Practice of the American College of Trust and Estate Counsel.
Trusts & Estates has asked Kelley to provide his unvarnished opinions on the tech resources available in the practice today. His columns are edited for readability only. Send feedback and suggestions for articles directly to him at [email protected].