Time was, finding qualified staff or handling a data security breach were accountants’ biggest concerns. But difficulties in working with a resource-challenged IRS have become a more pressing concern for CPA firms over the past year.
In some ways, this should be of little surprise to practitioners and the last two years in particular have only amplified a long-standing issue. It’s like, for a home owner, that stain on the ceiling that keeps getting bigger over time. You know it’s there, maybe it drips once in a while, you put a bucket down, you wipe it off, you know it needs to be dealt with, but you have bigger issues in your home to deal with.
Well folks, the roof is likely going to cave in sometime soon and it’s not as if practitioners, the AICPA or the NAEA haven’t been shouting about this for a long time, but the IRS needs fixed. It has needed repairs for a long time, but the funding has not been there, nor does it look to be there in the foreseeable future unless lawmakers are pressued to do so. What is a tax pro to do?
It has become so bad that some tax pros are looking to get out of tax for good. Can something they have done for years, decades even, and have become good at and built a loyal client base and revenue stream around end up on the trash heap? Or, and hear me out on this, is it time to re-invent your practice to not have to rely so much on “doing returns” as much as other, dare I say “high-value” work?
Don’t get me wrong, until there comes a day where taxes don’t have to be filed, and checked (and re-checked) the tax pro will be needed. Even with automation, a skilled human needs to be in the process.
The UK has been undergoing a program (programme, for my British colleagues) known as Making Tax Digital (MTD) which, for those unfamiliar, is about increased automation in the process of tax filing. Zoho actually has a pretty good resource on its site about MTD, but essenitally while there’s more than just annual filing, there’s also more automation and software involved in the process. This theoretically allows the tax pro to do more planning and consultative work rather than worrying about extensions or when clients will get their paperwork in.
But, we’re a long way off from that over here, so what does the tax pro do in the meantime? Maybe this “advisory” thing could be worth a go? Now I know, go find the time to figure out and plan and hire to do that kind of work. But it doesn’t have to be all at once, now does it?
In short, while I’ve never personally owned or managed a tax practice before, for the past 20 years I have watched you, listented to you, heard your joys and sorrows in doing this work and it pains me to see you wanting to just throw it away. Maybe one day you will sell your practice, but what exactly is it of value that you’ll be selling? Moreover, maybe it’s time to start thinking of that day and what it’s really going to take to build a sellable practice.
In the meantime, I hope you don’t give up. I hope that there IS hope that things will be better for your practice and that maybe even little old AccountingWEB can play some role in providing useful information and guidance that will help you towards a better path and save your practice. In fact, we’ll be hosting our next Tax Talk on this very topic so I hope you will join us.
Until then, keep hope. Talk to your colleagues, take a breath, you’re not beat yet.