Tax Season Tune-Up Checklist

by Roman H. Kepczyk, CPA.CITP, CGMA

With the busy season rapidly approaching, now is a great time for firms to review their tax production processes and tune them up to be optimally prepared for the opportunities ahead. Below is a tax season checklist covering five recommended areas for firms to focus their preparation, production, and training efforts during the months ahead.

1. Pre-emptive Client Meetings: With more and more client interactions transitioning to a digital format it has never been more important to meet clients outside of busy season and one of the best ways to do this is plan a face to face client meeting prior to year-end.

  • Produce a Tax Projection: You already have the relationship, tax data, and knowledge of who needs a projection, so expand this service to your entire client base to position yourself in a more consultative role.
  • Digital Interactions: Educate your clients on the benefits of using your portal and secure email for delivery of their organizer, engagement letter, tax return, and invoice.
  • eSignature: Explain the benefits and process to obtain digital authorizations including walking through application usage.
  • Invoicing: Update clients on new policies such as credit card acceptance and digital invoice delivery.
  • Extension Deadline: Inform clients that your firm must have complete delivery of all source documents by a specific date (i.e. March 25) or you will automatically file an extension.

2. File Server/Cloud Preparation: Review the storage capacity of each on-premise file server and increase as necessary for the items below and be sure you have at least 25% additional capacity afterwards (or consider immediately moving some of the data and applications to cloud providers).

  • Tax Applications: Calculate the disk space needed for the new 2017 tax year applications and return output.
  • Digital Source Documents: Evaluate the capacity required for all scanned source documents and PDFs created that you will be storing internally for the upcoming season.
  • Application Rollover: Estimate free space needed to close out/rollover previous year’s data particularly for practice management, workflow, and accounting applications, while taking time to delete un-needed files.
  • Merger Impact: If planning a year end merger, calculate the impact of additional data and application influx on your storage.

3. Maximizing Workstations: Verify that all tax workstations are optimally configured for new processes and digital applications including:

  • Additional Monitors: Tax users should be able to view all the applications and data they need to complete a tax return onscreen.
  • Collaboration Training: Educate users on the benefits of using Skype for communications, screen sharing, file transfer, and availability for real-time interaction and add a camera, speakers, and microphone if necessary.
  • Adequate Workstation Specifications: Tax software requirements for workstations increase every year so make sure each PC is optimized for firm production. Today, that means at least 8GB RAM and an i7 processor for on-premise processing, including a transition to Windows 10 to optimize screen utilization.

4. Scanning/Tax Output Production: Everyone involved in tax production should know how to handle both digital and paper files and to properly save documents in the appropriate location.

  • Scanning with QC: Have a tax person supervise the training for the scanning process including review and quality control of the file so staff learn to rely solely on the digital source document.
  • Organize/AutoFlow: Utilize the automated tools to automatically bookmark tax files to a firm standard and import as much data as possible.
  • Scanner Maintenance: Pre-schedule scanner maintenance before and during busy season and educate personnel on properly cleaning the scanner.
  • Physical Supplies: Review inventory of materials needed to produce physical tax returns including toner and binders and discontinue any use of CDs/thumb drives for tax delivery by training clients on portals and secure email solutions.

5. Optimizing Firm Workflow(s): All firms should be using a workflow tool or practice management projects to digitally track not only due dates, but every component of the tax process. Transition any standalone tax spreadsheets, routing/lead sheets or manual checklists to the firm’s workflow tool with the following considerations.

  • Refresher Training: Provide reminder training on the firm’s standard applications and expose staff to new features that will be utilized.
  • Review Rollover Items: Today’s workflow tools can rollover client information such as delivery instructions or a specific client document request list which should be rolled over, reviewed, and updated.
  • Organizer/Engagement Letter Delivery: Have each partner/manager review the listing of clients that will receive a digital organizer, physical organizer, PBC list, or have the organizer suppressed.
  • Proper Stratification: After workflows are rolled over, partners and managers should review them to verify they are assigned to the appropriate level staff and that any re-assignments or special considerations are documented.

The next month is the optimum time to meet with your tax production team and walk through a checklist to be as optimally prepared as possible!

Roman H. Kepczyk, CPA.CITP, CGMA, LSS BB is the Director of Consulting for Xcentric, LLC and works exclusively with CPA firms to implement today’s leading best practices and technologies incorporating Lean Six Sigma methodologies to optimize firm production workflows. Roman is also the author of the 2017 Edition of “Quantum of Paperless: A Partner’s Guide to Accounting Firm Optimization” which is available to members of the PCPS section.