By Ira S. Rosenbloom, CPA (Inactive)

The financial and operational success of many accounting firms has been dependent on the results of tax season. In these practices, as soon as one busy season is over, an immediate triage takes place and preparation for the next season starts in the fall. Planning is year-round.

These firms will better position themselves if they take actions that are highly specific to reaping the rewards from this aspect of their practice. After all, the goal should not be to have a good tax season, but rather a great one.

Here are six essential steps to put into place to experience a great tax season.

Right-Size Client Return on Investment  

Too many firms do work they should not do and serve clients they don’t want. Develop a grid of services that are going to make a strong impact on clients and staff. Then, tailor and trim the client base. The goal is to make the same money or more while handling fewer clients. If firms look to dismiss clients at a certain fee level, they must look at ways to replace them. For example, the less a firm focuses on compliance services, the less aggravating a tax season tends to be. Typically, that equates to happier staff and more profitability.

Implement or Intensify Outsourced Services  

Firms that have used offshoring and outsourcing report minimal client pushback and excellent pressure relief for staff. Firms should target moving 30% of compliance work to outsiders. Also, try shifting administrative functions to free up people. Support the accounting staff with templatized client communications, spreadsheets, and the like. Outsourced service providers will need to know what is expected well before tax season, so this is something to move on quickly.

Sell Undesirable Engagements  

As firms grow, some clients may no longer be the right fit. As you re-engineer, maintain an inventory of clients that can be “packaged” for sale to other firms. Use the proceeds to benefit your own staff during tax season, either with bonuses or other benefits during busy times. Interested outside firms need to plan for any acquisition, so this move needs to be considered and handled expeditiously.

Use Compensation to Change Behavior  

Many firms will pay staff commissions on new business. Consider paying a high percentage for bringing in clients with extensions or special projects. Furthermore, incentivize value and create a scale for internal valuation of different levels of 1040s. Reward people for hitting a total score.

Alter Client Expectation  

Increase your emphasis on planning and set clients up for acceptance of individual extensions. Use time in the summer and fall to plan aggressively and set estimates to support your work model. On business returns, create an add-on set of analytics to either incentivize early filing or push it back—whichever meets your ability to better manage work. Business returns tend to flow more efficiently; therefore, they don’t create as much tax season angst. This kind of shift takes time to implement and should be addressed promptly. It also should be discussed with new clients in the proposal process.  

Prioritize Star Clients and Star Staff  

Make sure you stay in contact with top-ranked staff to understand their concerns and level of satisfaction. Designing systems that meet your stars’ approval for tax season is very helpful. Keeping your top clients as a scheduling priority for tax season will make for happier clients and more driven staff. The better the link between staff and client, the stronger the tax season.  

Each tax season takes on a different personality, but each one can be great. Be aggressive about making tax season great. Start now if you aren’t already doing so; after that, focus on it all year long.  

Ira S. Rosenbloom, CPA (inactive), is chief operating executive at Optimum Strategies in Spring House and a member of the Pennsylvania CPA Journal Editorial Board. He can be reached at ira@optimumstrategies.com.

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Statements of fact and opinion are the authors’ responsibility alone and do not imply an opinion on the part of the PICPA's officers or members. The information contained herein does not constitute accounting, legal, or professional advice. For actionable advice, you must engage or consult with a qualified professional.