Tax time: As incomes, households and computer use rise, demand will increase

Operators that provide tax services typically generate a steady flow of revenue due to the necessary nature of filing taxes. However, a growing share of consumers and businesses are opting to file their taxes through software as they become attracted by online offerings. This has accelerated industry demand over the past five years, and enabled the industry to outpace growth for other tax-filing services. The industry is expected to continue its upward trend, as revenue is set to rise over the five years to 2016. Revenue for the Tax Preparation Software Developers industry will continue to rise over the five years to 2021, albeit at a slower rate, as price-based competition limits gains...read more.

Industry Statistics & Market Size
Revenue
$4bn
Annual Growth 11-16
10.7%
Forecast Growth 16-21
Profit
Employment
8,584
Businesses
207
Market Share of Companies
What Our Customers Say

Industry Threats & Opportunities

  • A growing share of consumers and businesses are opting to file their taxes through software, accelerating demand
  • Brand recognition is a key success factor for operators in this industry
  • The industry will benefit from increased adoption of online services and rising employment levels
  • Industry Report - Industry Key Buyers Chapter

    The Tax Preparation Software Developers industry exhibits a medium level of concentration. Notably, market share concentration may not fully reflect tax preparation software usage as some software packages offer the most basic services for free. Market share concentration has remained steady over the past five years as the industry's largest players have increased size along with industry expansion, by growing their customer bases and the range of products they offer. Intuit experiences a dominant position in the market due to its well-established brand name, TurboTax. Additionally, Intuit has been able to leverage the brand recognition of its other personal finance products to increase consumer and business adoption of its tax preparation software...purchase to read more.

    Additional Insights for the Tax Preparation Software Developers Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Tax Preparation Software Developers Industry are

  • Having brand name recognition
  • Providing customer support features
  • Ensuring pricing policy is appropriate
  • IBISWorld analysts also discuss how external factors such as Number of households and Percentage of services conducted online in the Tax Preparation Software Developers industry impact industry performance..

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    What is the Tax Preparation Software Developers Industry?

    This industry provides software, usually hosted online, that enables individuals to file federal and state tax returns. The software is designed to guide users through their tax returns step-by-step. Additionally, operators in the industry provide software for small businesses. This industry excludes tax preparation software used by professional accountants.

    Industry Products
  • Online tax software
  • Desktop software
  • Free file alliance
  • Industry Activities
  • Providing federal income tax preparation software
  • Providing state income tax preparation software
  • Providing small business tax preparation software
  • Providing professional tax preparation software
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Number of households
  • Percentage of services conducted online
  • Poverty rate
  • Number of businesses
  • Time spent on leisure and sports

  • Current Performance
  • Tax goes online
  • Industry structure
  • Banking on business
  • Chart: Revenue Growth

  • Industry Outlook
  • Pressure on profit
  • Demographic trends
  • Continuing shift in business models
  • Table: Tax Preparation Software Developers Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Tax Preparation Software Developers Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Retail Trade
  • Law Firms
  • Tax Preparation Services
  • Consumers

  • Key Selling Industries
  • Computer Manufacturing

  • Products & Services
  • Online tax software
  • Desktop software
  • Free file alliance
  • Chart: Tax Preparation Software Developers Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Consumers aged 65+
  • Consumers aged 55-64
  • Consumers aged 35-44
  • Consumers aged 45-54
  • Consumers aged 25-34
  • Consumers aged 18-24
  • Businesses
  • Chart: Major Market Segmentation for the Tax Preparation Software Developers Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Purchases and labor
  • Depreciation and other expenses
  • Chart: Cost Structure Benchmarking – Sector vs Tax Preparation Software Developers

  • Basis of Competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Tax Preparation Software Developers Industry

  • Industry Globalization
    Intuit Inc.H&R Block Inc.
  • Table: Intuit Inc. - financial performance
  • Table: H&R Block Inc. - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Tax Preparation Software Developers Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Tax Preparation Software Developers Industry
    Includes:
  • Industry Revenue (2007-2021)
  • Industry Gross Product (2007-2021)
  • Establishments (2007-2021)
  • Businesses (2007-2021)
  • Employment (2007-2021)
  • Wages (2007-2021)
  • Percentage of services conducted online (2007-2021)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    E-Filing
  • Sending a federal or state income tax return from tax software via the internet to federal or state tax authorities.
  • Free File Alliance
  • A private-public alliance between tax preparation software firms and the IRS. Firms provide free federal tax return services to consumers who make less than $57,000 a year.
  • Internal Revenue Service
  • The department of the federal government responsible for collecting federal taxes.
  • Tax Deduction
  • A tax benefit offered by the IRS or a state tax authority that reduces the amount of income on which tax liability is calculated.
  • Why buy this report?

    IBISWorld’s Tax Preparation Software Developers Industry Research Report offers insight into the market at the national level. Our analysis highlights macro trends in the overall sector and the micro trends faced by companies that do business in the Tax Preparation Software Developers industry. Our five-year outlook forecasts explain how the market is set to change and the product segments that will drive growth.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Tax Preparation Software Developers:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Tax Preparation Software Developers market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Tax Preparation Software Developers, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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