Archive for the ‘Tax’ Category

Friday, October 11th, 2019

Down to the Wire

“Boredom is a choice. Like tardiness. Or interrupting” – Mike Rowe

Another due date is approaching. Usually, in public accounting, the same thing happens with every deadline, whether it is Spring or Fall.

There is a last-minute push to get that final return out the door. It is hectic and stressful for everyone. Deadlines in most firms are dreaded, especially by the administrative team.

The accountants breathe a sigh of relief. Things are off their desk and it is time for the celebration to begin at 4:30 in the lunchroom. While the party is ramping up and pats-on-the-back are exchanged, the administrative team is still frantically working. They are processing those last returns, they are waiting on Last Minute Larry (client) to stop by to sign something or they must actually get in their car and deliver something to a client.

Progressive firms have worked on this issue and devised a proper scheduling system so that tax returns and other projects do not hit the reviewer’s desk with little time to spare. Reviewers keep the flow moving steadily so that the admin team does not have to rush around at the last minute (and miss the after-party, as usual).

Usually, this scenario is blamed on the client. Why not establish a more aggressive system for obtaining client source data? Why not outplace clients who are repeat offenders? Clients can be trained.

 

  • An expert is someone called in at the last minute to share the blame.
  • Sam Ewing

Monday, October 7th, 2019

National Tax Conference – FYI

“It’s income tax time again, Americans: time to gather up those receipts, get out those tax forms, sharpen up that pencil, and stab yourself in the aorta.” – Dave Barry

The quote above is for those of you preparing extended 1040s!

Here’s a press release from the AICPA:

SAVE THE DATE: AICPA National Tax Conference

Washington, D.C. (October 3, 2019) – This November, the American Institute of CPA

s (AICPA) will host its annual National Tax Conference. Press registration includes access both online and in-person access. Please mark your calendars.

WHAT:            2019 AICPA National Tax Conference

WHEN:            November 13-14, 2019                                                          

WHERE:         The Marriott Marquis, Washington, D.C.

INVITED:                   

  • Charles Rettig, IRS Commissioner
  • Michael Desmond, IRS Chief Counsel
  • Rochelle Hodes, Washington National Tax Office Crowe, LLP
  • Tony Nitti, Partner, RubinBrown LLP

TOPICS INCLUDE:

  •  Using Machine Learning to Predict Outcomes in Tax Law
  •  Treasury and the TCJA
  •  Small Business Exceptions and the Tax Shelter
  •  Lessons Learned from the 1st Year of Filing After TCJA                             

CONFERENCE SCHEDULE: Current information about speakers and conference topics including full agenda may be found here

 

Note: AICPA Fall Tax Division Meeting will take place at the Marriott Marquis on November 15th. These meetings are open to the press but not accessible via the internet.

 

  • I'm proud to pay taxes in the United States; the only thing is, I could be just as proud for half the money.
  • Arthur Godfrey

Friday, February 15th, 2019

New State Electronic Filing Requirement

“You have to learn the rules of the game, and then you have to play better than anyone else.” – Albert Einstein

One of my clients recently talked to me about the 10 business day rule for state electronic filing. I was unaware.

Since then, I have talked to several more of my clients and most of them were not aware of this new “rule.” The new requirement has been implemented for every software company and is intended to reduce the error rate of returns filed without the latest update(s).

Via CCH: The requirement mandates that “users/customers of this product who attempt to e-file 10 or more business days after a production release will be required to download and apply the product update.”

Read more about it here via CCH and also here via Accounting Today.

  • There are no rules here - we're trying to accomplish something.
  • Thomas Edison

Tuesday, August 28th, 2018

Emergencies

“Great emergencies and crises show us how much greater our vital resources are than we had supposed.” – William James

I don’t often use a complete post by Seth Godin. However, this one hits so close to home for CPAs that I just had to share it right here – so you will read it!

Another important due date is approaching. So many of you tell me that much of the stress is caused by clients who fail to provide information. Then it becomes a fire drill to complete their tax return by the due date causing stress and frustration for the entire team. His first paragraph is exactly you. 

You must charge a significantly higher fee for emergencies. If those tardy clients won’t pay it then let them go elsewhere. Quit complaining about these clients and take steps to solve the situation.

Emergencies Cost Extra

If you work in a field where things need to be delivered by date certain, with zero defects, with high consequences if you make a mistake—then you need to charge a premium for exposing yourself to emergencies.

It doesn’t matter what something in a non-emergency situation costs. If someone wants the standard version, let them buy that.

The buyer is offered to pull it off the shelf, see if you like it. If it doesn’t satisfy you, take a different one.

Emergencies (or even the risk of emergencies) cost extra. Yelling at us costs extra. Panic costs extra.

Your entire organization (and your entire day) revolves around preventing the emergency or recovering from it when it occurs.

The reason custom work costs more is no longer a matter of production efficiency. Computers are happy to customize things.

Big companies that serve other big companies spend at least 80% of their overhead on being ready (or dealing with) meetings and emergencies.

The reason to charge more is all about ensurance, insurance and emotional wear and tear.

If that’s the sort of work you want to do, charge appropriately.

  • History is a relentless master. It has no present, only the past rushing into the future. To try to hold fast is to be swept aside.
  • John F. Kennedy

Friday, December 1st, 2017

Busy Season Begins

It is December 1.

For years, we considered the beginning of “busy season” – we used to call it tax season but that term is no longer comprehensive enough – to be January 2.

Some firms would even require employees to begin working extended hours immediately after the New Year holiday, whether they truly had full schedules or not.

Firm leaders would often struggle to keep people busy after April 15th. They longed for more projects that could be scheduled from May to December. These days, from my observations, busy season continues throughout most of the year.

In my recent discussions with various firms of all sizes and locations, busy season begins in December. Firms are engaging their clients in much needed tax planning and those appointments plus completion of other tasks that have to be done before January, add some additional stress to the holiday season.

Firm leaders are challenged with allowing their employees to take extra time off during December when some clients need attention right up to the last minute on December 31.

This came to mind because of the recent news that American Airlines allowed too many pilots to schedule time off during those last two weeks of the year and perhaps 15,000 flights were in danger of being cancelled. It seems they have worked it out by paying the pilots additional money to cover the holiday rush.

Maybe that is a solution for you. You might have some employees who would work more hours during those last two weeks of December (for additional dollars) so that other employees could have time off for family activities.

Let the scheduling games begin!

Monday, November 27th, 2017

Year-End Tax Checklist

“Life is simple, but we insist on making it complicated.” – Confucius

Well-managed CPA firms have, for a long time, supplied their individual income tax clients with some sort of year-end tax checklist. It is meant to be a helpful tool to encourage the clients to consider significant (and some insignificant) events that might affect their tax return.

At my firm, we used to include the tax checklist with the tax organizer. Many clients, as you can imagine, never bothered to look at their organizer, so they also missed the tax checklist. Then, we stopped providing tax organizers. Our default setting was “No organizer” unless a client specifically requested one. A few did.

Things are so much better now. You can simply send an email to your clients with a link to the annual tax checklist. They can quickly scan through the questions and provide you with information that affects their return.

Last week I received an email from one of my clients that included the year end tax checklist link (just because I am on their mailing list). It was quick to read, easy to review and made me think about pertinent information. That’s exactly how you want your clients to feel about how you provide services – quick, easy and pertinent!

Make 2018 a year when you become a proactive advisor to your clients and get away from always being in reactionary mode.

  • The ability to simplify means to eliminate the unnecessary so that the necessary may speak.
  • Hans Hofmann

Tuesday, November 21st, 2017

State Income Tax

“The hardest thing in the world to understand is the income tax.” – Albert Einstein

This is one of those “I thought you might find this interesting” posts. You and your clients probably have several mobile workers.

Patrick Adcock, an analyst with Tsheets, provided insight into some interesting tax news and wanted to share some research he worked on related to the Mobile Workforce and Tax Simplification Act. 

The bill would prevent states from taxing non-resident workers unless they work in that state for more than 30 days. According to the CBO, the hardest hit states will be Illinois, Massachusetts, California, and New York.

Be sure to check out The Complete Guide to State Taxes for Mobile Workers and read more interesting details about this simplification act. 

  • Our new Constitution is now established, everything seems to promise it will be durable; but, in this world, nothing is certain except death and taxes
  • Benjamin Franklin

Wednesday, September 6th, 2017

Workflow Software

“Only two things are infinite, the universe and human stupidity, and I’m not sure about the former.” – Albert Einstein

There are still many of you out there, working in CPA firms, without the advantage of workflow software.

Sad but true, I continually interact with CPA firms who are just “sort of” paperless. One of the tools that makes becoming truly a digital firm a reality is workflow software. From your desktop, you know who has what and how projects are flowing through your office.

Last week, Accounting Today featured an article: Software Survey: Workflow solutions in 2017.

Simply put, workflow for tax preparation means tracking all of the paths and operations involved in producing a return and invoice, and making certain all of the tasks are performed on time by concrete due dates.

Workflow software gives you peace of mind. It helps you be sure that no client falls through the cracks when it comes to due dates. Missing a due date is one of a CPA’s biggest worries!

I know, when my firm adopted GoFileRoom for document management many years ago, the most attractive feature was the workflow portion.

If you are one of those firms still without a workflow tool, be sure to read the article – it is full of great insights from various sources/vendors.

  • When you forgive, you in no way change the past - but you sure do change the future.
  • Bernard Meltzer

Tuesday, August 1st, 2017

Deadlines

“A goal is a dream with a deadline.” – Napoleon Hill

CPAs and their entire workforce are driven by deadlines. Of course, most of you reading this know how many tax deadlines there are. I think that working in a CPA firm for so long has definitely made me deadline focused.

It seems inside the CPA firm, if the deadline is several weeks off, the attitude might be, “Why worry, we have plenty of time?”

The_Snowman_(Nesbø_novel)Occasionally, you might miss an important deadline. It happens. That is why I found a passage in the book “The Snowman” by Jo Nesbo, so interesting. I never knew the origin of the word “deadline.”

Here’s the passage:

Harry had read that the word deadline originated from the battlefields of the American Civil War, when, for lack of anything material to lock prisoners behind, the captors gathered together the prisoners and a line was drawn around them in the dirt. Which became know as the “dead line,” and anyone who strayed beyond it was shot. 

Maybe the word “deadline” will now have a whole new meaning for you. Don’t miss one!

  • A deadline is negative inspiration. Still, it's better than no inspiration at all.
  • Rita Mae Brown

Wednesday, July 5th, 2017

Yes, It’s July – But Be Thinking About November

“Education is the most powerful weapon which you can use to change the world.” – Nelson Mandela

An age-old challenge inside many accounting firms is the fact that the business client expects you to do their taxes from a very messy set of books.

I have observed that is usually the case when the business owner has a bookkeeper that is really not qualified (think wife, mother-in-law, sister – you know, someone you can’t fire).

Often, even a very qualified small business bookkeeper doesn’t really understand what your CPA firm needs and how/when you need it.

That’s why I suggest you hold a Bookkeeper/Controller Breakfast for your clients in late November. Invite all your client bookkeepers to the event and offer education along with breakfast and good conversation.

Make them feel special. Provide goodie bags with the firm trinkets (pens, pencils, firm logo post-it notes, candy, gum, maybe even a t-shirt). If you start at 8:00, they can be back in their office by 10:00.

The “program” can be very short and very informative. Explain to them the important role they play in making year-end an enjoyable and efficient experience for themselves (and the firm). It might even save their boss some accounting fees!

Many of them might not have a clue about the firm’s expectations. Plus, I have actually seen them learn some very helpful tips from each other.

  • Education is what remains after one has forgotten what one has learned in school.
  • Albert Einstein