Five Timesaving Tips for a Smoother Tax Season

From the January 2012 Issue.

It’s that time of year again — time to steel yourself for the work that will begin flowing in just a few weeks. For me, January is always like the calm before the storm. You know it’ll hit soon, and you’re powerless to stop it. There’s an ever-present anxiety because you’re not sure how bad this one’s going to be, so you expend a lot of energy thinking of ways to prepare.

Some may tell you that it’s too late; that you’ve done all you can do. That it’s time to just hunker down and wait for it to start, hoping it will be over before you know it. In truth, it may be too late to drastically change the course of your tax season. However, some relatively easy workflow strategies can help you realize timesaving efficiencies and help you better weather the storm.

By polling firms formally and informally, we’ve uncovered five tried-and-true strategies for a smoother busy season. Not surprisingly, most agree that a little pre-season planning and preparation can go a long way.

1. Communication

This is critical. It won’t eliminate unexpected kinks in your busy season plan, but it will help to minimize them. Your firm should have a clear communication strategy for clients, staff and any third-party resources you plan to utilize during busy season. Don’t assume that everyone is already on the same page.

Depending on the size of your practice and your relationship with individual clients, communication may be in person or in an engagement letter. Key elements should include the following:

• Clearly state when, how and where to submit tax information.
• Give the deadline for tax data, making it clear that failure to meet that deadline results in an automatic extension
• Provide disclosure and consent forms.
• Use this as an opportunity to manage expectations, emphasizing constraints on your time.

If you have people going into the field, arm them with the list of information needed for tax season so they can address it in person with the client. Make it part of your year-end planning to tell your client when their work is scheduled and get their buy-in. This gives them an opportunity to alert you to scheduling conflicts such as vacations, board meetings, etc.

It’s important to clearly articulate your expectations for your staff – hours, weekend work, opportunity to work remotely, contingency plans in the event of an unexpected absence due to illness, weather, or personal matters (if this varies from your normal HR policy).

Additionally, if you’re using temporary or seasonal workers, or outsourcing, now is the time to inform that resource of what to expect in terms of a time commitment in order to avoid misunderstandings or over-commitments later.

Finally, set a staff schedule for when you will meet during busy season. Allow some flexibility, but lock in key dates for things like determining when to extend clients to avoid wasting time trying to schedule management discussions on the fly. If you’re planning to meet once a week to review workloads and schedules, do it the same day and time every week and set a standing, manageable agenda that will allow participants to get what they need quickly to balance work and address potential resource issues.

2. Capacity Planning

Two important themes to pre-season preparation: Use what you learned last year as a guide, and do as much as possible before the season really gets going. For example, you might want to run last year’s extension report and prepare these same extensions in early January.

Look at how you handled the larger, more complex client returns last year to see exactly when the return was prepared and reviewed, and build it into your scheduling for this year. Research major tax law changes in advance, and add that intelligence into the appropriate client tasks within your workflow software. For example, you might do a data scan to identify all the clients that will be impacted by the new tax legislation this year, then flag them and add instructions to those tasks universally so the preparer and reviewer have the information at their fingertips.