Managing Your Firm through Tax Reform Implementation

by Carl Peterson, CPA, CGMA | Apr 24, 2018

When the Tax Cuts and Jobs Act reworked the tax code, it happened fast. And your clients want answers, fast. They want to know how the new law affects them now and going forward, but we don’t yet have clarity on some of the specifics or regulations to guide us.

Clients are calling about the rules for business meals and entertainment expenses, and if they can move them to marketing; they want to know what QBI is and if they should worry about it. To field these inquiries, staff needs to get up to speed, too.

Do you have the right processes in place to manage the opportunities that come from these challenges?

Firms, at a minimum, need to address the following as soon as they can:
  • Education
  • Prioritizing clients and their inquiries
  • Internal processes
  • Managing expectations
Education is one of the first priorities. The AICPA tax reform webpage ( is a great resource for guidance, as is PICPA’s Tax software providers and research providers also are pushing out information on the new tax act, but that will only take a firm so far. How do you communicate the changes with your clients from a practical standpoint directly related to their industries? My firm would always go to industry-specific organizations. For example, as a niche practice in the real estate and construction industry, we monitored trade organizations for the homebuilding and commercial contractor industries for tax articles. Their experts provide practical implementation strategies that can help shape conversations with clients specific to that industry.

As soon as the Tax Cuts and Jobs Act passed in December 2017, clients began calling – not only your best clients, but your smaller clients, too. You had to react right away to requests for your time and expertise; perhaps you put many on hold until the end of tax season. Prioritize that client list now. Review the list, and rate your clients A, B, C, D, or F (friends and family). While you may want to terminate F-rated clients, practically it would be better to terminate your D clients. With tax reform, you may be able to then move some C clients to a higher rating. As tax season winds down, this is an opportune time to terminate clients who cause you the most stress during tax season. If you need help with this process, the AICPA Private Companies Practice Section has a great tool to guide you through rating your clients and example termination letters. With the turbulence of tax reform, you need to prioritize which clients you will reach out to first and be their trusted adviser who works through the impact of the new tax law.

There is a lack of clarity to much of tax reform, so it’s imperative that you astutely manage the process, meeting the challenges and opportunities. Not only must you prioritize your client list, but also create a new workflow project or item for each client. That workflow item could be as simple as “Tax Planning 2018.” If your firm is paperless, use a workflow process application. For those still in a paper environment, create a tax-planning lead sheet for every client. You can’t afford to miss out on this opportunity to engage the client. Build out the new workflow item and assign it to appropriate staff with reasonable completion dates. Also, include status reports on this new workflow item to weekly staff meetings.

The opportunity to deepen your client relationships as their trusted adviser starts with managing client expectations. Every year when you do tax planning, consulting, accounting, and advisory services for a client, you are managing their expectations. Major tax reform creates anxiety in clients. Assuring them that your firm has it under control will ease that anxiety. Be proactive. Communicate through your firm website or newsletters, but also through personal outreach. Schedule some time for you and your client to dive into their business, and advise them on the impact of tax reform and what they can do to move their business forward.

Managing client expectations is important, but so is managing staff expectations. Bring staff into the planning process. This will create transparency, give them a voice to improve firm processes, and set their expectations in responding to change. Staff want to contribute to firm operations. Give them an opportunity to participate in identifying education needs, client ratings, workflow processes, and client outreach. Build a team approach. Discover internal coaching opportunities and develop staff for firm growth.

Clarity of the Tax Cuts and Jobs Act may take two or three years as the IRS and U.S. Treasury roll out applicable regulations and guidance. Firms don’t have the luxury to sit back and wait. The time is now for planning and managing change to position the firm for the opportunities that come with major tax reform.

Carl Peterson, CPA, CGMA, is vice president of small firm interests for the AICPA in Durham, N.C. He can be reached at

Read the full Federal Tax Reform Guide presented by the Pennsylvania CPA Journal >

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