Following the path paved by 2020, the IRS has extended the tax deadline from April 15th to May 17th, 2021. On Monday, I discussed the arguments supporting an extension being unlikely this year, but as of Wednesday, we’re operating on a new timeline. While we knew this wasn’t completely out of the realm of possibility, practitioners are now gearing up for another prolonged busy season, but the good news is there are ways to stay ahead. This second extension could prove to be opportunity for your firm. Here’s a list of best practices for firms to consider as we embark on an all-too-familiar adventure.
Tip 1: Consider all angles
Taxpayers may be breathing a heavy sign of relief, but as a practitioner, you know the extension is somewhat of a double-edged sword. On the downside, you’ve now got another month tacked onto your busy season. Additionally, if your firm is heavily focused on compliance, and revenue is tied to producing a return, you could be facing a real financial short-coming. However, there’s a silver lining here. With the passage of a new stimulus bill and provisions that impact 2020 returns, clients have questions that need answering and this opens the door to opportunity with advisory. Take advantage of the opportunity for your firm by offering clients personalized and dedicated time to answer their burning questions. Your firm can not only meet individual client needs, but make up for short-term revenue gaps, as well. This can be as simple as charging a flat rate to willing clients for each half hour to hour you spend with them. With the extension, there’s also potential for a short-term economic stimulus. Additional time to pay taxes means clients have money in their pockets that they can spend now, providing you the opportunity to show them money spent on advisory services will pay greater returns in the long run.
Tip 2: Overcommunicate with clients
You’re almost guaranteed to get an increase in emails and phone calls from clients this week, asking what the new $1.9 trillion COVID-19 relief bill and the extension mean for them. Do yourself a favor get ahead of the chaos by overcommunicating with clients. Sending out newsletters updating clients on broad changes that affect many of your clients will help you avoid dozens of one-off phone calls and emails asking the same questions. Proactive and automated communication is not only a quick way to get in touch with several clients but also a great way to showcase your own expertise and that, despite the chaos, you’re still plugged into their ongoing needs.
Tip 3: Work smarter, not harder
Staying organized will be a key differentiator between firms who thrive in the coming weeks and those who become overwhelmed by the burden. To stay on top of the workload, use your firm’s technology to its fullest capabilities to help define workflows across your firm. Tools like Onvio Firm Management use cloud-based capabilities to provide visibility across your practice and help maintain peak performance – even when the rules of the game have changed.
Having the latest information at your fingertips is also an essential component for a successful season. Research tools like Checkpoint Edge, which uses AI and are informed by industry experts, help you get trusted answers at a time when you need them most. With new legislation, you can anticipate complex issues and the need for quick and reliable information. Guessing at answers isn’t an option, regardless of how well-informed your guess may be.
Tip 4: You’ve got this
The extension may have been unexpected, but it doesn’t have to be unbearable. Putting these tips into practice at your firm sets you up to have a successful tax season, even if it is a longer one. Stay informed with the latest insights from Thomson Reuters experts and check out the Tax Season Resource Center for more tips and tools to help your firm thrive this tax season.