How to Leverage Reform as a Catalyst for Growth
Many tax and accounting professionals are currently faced with the same challenges — what to do prior to tax season to prepare for the Tax Cuts and Jobs Act (TCJA), including all the client inquiries naturally accompanying it, and how to quickly and effectively transition to advisory services.
As a direct result of tax reform combined with increasingly sophisticated do-it-yourself software, tax professionals risk losing clients who view their returns as less complex and as a result, attempt to file their own returns. Accounting firms must also find ways to generate more revenue from clients requiring more time than what was required in prior years.
It’s more important now than ever to find offerings that complement each other to form an end-to-end solution that empowers firms to thrive when faced by these challenges. Professionals have an added challenge to find new value for all of their clients and need a toolset to efficiently handle the following:
Keeping abreast of regulatory changes and opportunities – Staying informed amidst the seemingly endless flurry of updates and publications is made easy with the use of research guidance resources and tools, such as Checkpoint. Subscription plans not only provide access to a tremendous amount of information for researching purposes, but it also allows for setting up preferences to be notified when new information becomes available related to topics of interest. The Individual Tax Planning Package on Checkpoint is one example. If there is a specific topic that needs further investigation, resources such as Checkpoint Catalyst and the Complete Analysis of the Tax Cuts and Jobs Act provide in-depth research and guidance. The Tax Cuts and Jobs Act Accounting Firm Toolkit also provides summaries for topics such as key individual, entity-specific, general business, and international tax provisions.
There are a myriad of learning opportunities via Checkpoint Learning self-study courses including The Tax Cuts and Jobs Act: What You Need to Know, 49 Things Individuals and Small Business Owners Need to Know About the New Tax Law, and Qualified Business Income Deduction.
For those looking for live online events, the upcoming virtual conference Understanding the Tax Cuts and Jobs Act will provide a deep dive into the Tax Cuts and Jobs Act, including topics such as: Section 199A qualified business income deduction, the proposed regulations and Notice 2018–64; bonus depreciation and cost recovery provisions under proposed regulations; international tax provisions including clarifications under the “GILTI” proposed regulations; and more.
Analyzing client data – For those who want to get ahead of as many client inquiries as possible and provide an additional layer of value, firms must analyze their own client data to identify needs and opportunities. With the data mining utility built into UltraTax CS, data can quickly and easily be mined to determine which clients will be impacted by reform in specific ways, taking all the legwork out of determining which clients will benefit from additional proactive communications, advanced tax planning, or other advisory services.
Other resources also available in the Tax Cuts and Jobs Act Accounting Firm Toolkit include checklists for key topics such as individual tax planning and the qualified business income deduction (QBID).
Additional items that seem to be receiving less attention are the tax depreciation optimization opportunities, many related to Bonus Depreciation vs. Section 179 Expense. Fixed Assets CS provides comprehensive reporting capabilities that make it easy to uncover which opportunities would be more beneficial. These reports can also help determine which clients would be best served by foregoing immediate tax savings in favor of depreciating assets over their normal life to remain at a lower taxable income for a longer period of time, providing greater benefit with items such as the qualified business income deduction.
Preparing strategies and tax optimization plans – Once firms have identified which clients would benefit from advanced planning services, there are a variety of options based on different needs. Planner CS makes it easy to prepare virtually any multi-state individual tax plans spanning multiple years and including multiple alternatives. It also provides an automated way to create TCJA comparison plans that compare operating a business as an S Corporation vs. a Sole Proprietorship or Partnership.
Checkpoint Tax Planning Packages are available for individuals or businesses with guides and worksheets focused on topics such as high-income individuals, self-employed individuals, choice of business entity, and more.
The Tax Cuts and Jobs Act Accounting Firm Toolkit also offers resources such as the Comparison of Section 179 Expense and 100% Bonus Depreciation and the Section 199A Qualified Business Income (QBI) Deduction Flowchart.
Delivering plans and strategies – For those clients receiving additional planning and advisory services, it is crucial that the delivery or presentation of this information effectively portrays the value embedded in the service. Whether in UltraTax CS, Planner CS, Fixed Assets CS, or Checkpoint, it is easy to generate client letters or visual aids such as charts, graphs, and reports to assist with this important stage of the process.
As tax season compression continues to be a growing concern, it is imperative that professionals turn to the technology that enables them to leverage reform as a catalyst for growth. The end-to-end solutions mentioned here and made available by Thomson Reuters along with offerings such as Practice Forward can save firms countless hours by automating many of these processes, allowing them to focus on finding and developing quality staff, growing their firm, and increasing their profitability.
Be sure to bookmark this page for additional resources and updates regarding tax reform.