By Ryan C. Raffensperger, CPA
Think back. Do you remember how some folks were saying the 2017 tax season was going to be the smoothest in recent memory?
- The IRS had refined security measures and partnered with software providers to implement better filing procedures.
- New deadlines ensured that clients would get their K-1s from their publicly traded partnerships in plenty of time for the individual tax deadline, so practitioners wouldn't have to file extensions to report $3 of income or a suspended passive losses.
- Plus there were no significant tax code changes, and we were all finally growing comfortable with the Affordable Care Act tax provisions.
Tax season 2017 was going to be a walk in the park.
That's not really how things played out, is it? To borrow the slogan of the NHL Playoffs: "There's Nothing Like Tax Season."
At our firm, we’ve spent the past few weeks after tax season rebooting, recharging, and trying to accomplish all the things we put off until after the April deadline. We've also used that time to internally assess how things went and to start planning for 2018. I think we relearned that tax season is always going to present its unique challenges, no matter the expectations beforehand, and therefore our processes must always be refined.
Technology continues to frame how the tax and accounting industry grows, but I think there has been a shift in our clientele: they are more expectant of the use of modern technology than tolerant of it. We have a lot of clients who we didn't think knew that the Internet existed; now they’re calling to say how great it was that they could download their return to their phone. Certainly there will always be some clients who resist and insist on a paper copy of their return so they can go to the post office and mail it. But the widespread acceptance of technology has our small firm looking at additional ways to use it to benefit our clients.
All of the new deadlines this year seemed to create an unforeseen avalanche of activity from late February through mid-March. I wasn't expecting the changes to affect the timing of information arriving from taxpayers as much as it did. I think many heard that some refunds were being held until at least Feb. 16 due to a new IRS holding period for refunds with particular tax credits, so they figured why bother to get their return done if the refund wouldn’t be available. We'll examine this more closely and try to find a way to get clients to deliver information to us sooner, and to keep our turn-around consistent.
In retrospect, we were pleased with how tax season went this year. We were able to complete more returns by the deadline than we ever had previously, up about 10 percent from 2016. Some of that was because of changes we made and improved technology.
The thing that struck me the most this year, though, was the number of new young clients we were able to work with for the first time. Those individuals looked beyond all the national TV marketing and sought out a trusted professional to help them with their tax situation and create a plan going forward. In a day where that is a concern for this profession, it was very refreshing to see.
We survived another tax season with only a few bumps and bruises. Now, getting ready to do it all over again is the tough part.
Ryan C. Raffensperger, CPA, is a partner with Raffensperger, Martin & Finkenbiner LLC in Gettysburg, Pa.