Impact driver, wait I though it was called an impact wrench. While these share many similarities, an impact driver is different from an impact wrench. An impact wrench is usually heavier, bulkier and has more torque. An impact wrench is designed to use a socket and fasten and loosen bolts. An impact driver usually has less torque, looks more like a drill and is designed to take 1/4″ shank bits. While you can use an impact driver for small bolts, an impact driver shines when using screws and other similar fasteners.
Before we start we need to first understand what an impact driver is. An impact driver is similar to a drill, but as the name suggests, it also impacts while rotating. Let's say you are driving a screw into a piece of oak wood. When you start drilling the screw, the impact driver works like a drill and rotates screwing in the screw. You will get to a point where the pressure build around the screw will require more force to drive home the screw and set it. The impact driver will sense this resistance and start its impact procedure to help provide more torque and pounding to get the screw to sink and set.
Behind the bit holder is an anvil, which is a two lugged gear. A drive gear with two matching lugs will repeatedly strike the lugs of the anvil causing an impact. This extra force helps produce more power to your application than straight drilling.
You may be thinking, my drill has a hammer feature which is similar, right? Well not exactly. A hammer drill is a lot different than an impact driver. While they both rotate to drill, the similarities end there. A hammer drill or the hammer feature that is on your drill has one primary function, and that is to drill through Concrete, rock or other hard material. You should not use the hammer feature when trying to drill into wood or other like materials. When drilling into wood, the impact driver is made for this and performs great.