What is TXF?

How to Use TXF to Import Data to Tax Software

Tax software makes filing a tax return easier.
Income Tax Season. Credit: Getty Images / Photodisc

TXF is the acronym for Tax Exchange Format, and it is a file extension for data files containing tax-related information. Since TXF is an accepted standard for saving tax data in financial software, such as Quicken, Intuit and Microsoft Money, most income tax preparation software will import this type of file. TXF files have the .txf file name extension and are intended for import by tax preparation software.

How to Use TXF

Exporting TXF data from your financial software and then importing it into your tax software saves time you would otherwise spend entering data into the tax software to prepare your income tax return.

Most Windows personal finance software exports TXF data, as do some Mac personal finance software titles. To create a TXF data file from your financial software, you can usually click on File, Export, and then choose to export tax information. If this procedure doesn't work, do a search in your software help documentation to determine if this is possible.

If you are going to use your personal finance software to create a TXF file, it's essential that you properly categorize tax-related expenses throughout the year.

The TXF file extension has also been used for compressed archive files, which combines multiple files into one that can be compressed.

What is the Best Tax Software?

Tax software comes with accuracy guarantees, and most offer a highest tax refund guarantee as well as a state tax return, but usually at an additional cost.

U.S. service members should look over the free tax software for military members.

Free tax software is typically only an option offered to new customers. If you used free tax software last year and you want to use the same software this year, you will probably have to pay for it, or you'll have to choose another free tax software to use this year to avoid charges.

Tips For Choosing Accounting Software

If you're keeping tabs on more than just your own income you'll likely be using accounting software, especially if you're a small business owner. This software saves hours of time compared to handling the books manually and is usually more efficient than using spreadsheet. This is because accounting software reduces or eliminates redundant data entry, like entering the customer's address on the quote, then the work order, and then the invoice.

If you are a sole proprietor with no employees, low or no inventory and a handful of customers, you may not even need accounting software. Otherwise, there are always free or low priced accounting software options available.

Small business owners who carry inventory, have more customers or employees. Accounting software will save time and produce more accurate records.

Narrowing Your Choices

Narrow down accounting software choices by making a list of small business accounting features you need to run your business. Most small business accounting software features include:

  • Inventory management
  • Sales tracking
  • Manage customer contacts or work with your current contact management software
  • Merchant account support to accept credit card payments
  • Budgeting
  • Estimates
  • Payroll
  • Business tax reporting

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