Tax Season Uncovered A Tax Professional's Insights and Lessons Learned

I’ve been preparing taxes, on my own, for the past, at least 7 years. In this video, I wanted to share the biggest takeaways for anyone looking to get into taxes or the accounting field or someone looking to improve their business operations.

Since starting on my own, I have to say that this was by far the least stressful tax season for me. I don’t know if this was the case for any of my peers. Normally for most tax pros, tax season is very stressful, with the long hours and tons of never ending work.

But this year I did things differently that probably contributed to the easier tax season.

#1 I raised my prices

Now, don’t get me wrong, I raise my prices every year to keep pace with the increased cost of doing business, and all the additional requirements that I need to put in place to protect my clients records, like enhanced security measures, backup and storage, and of course using the latest and greatest software solutions.

Like seriously, what hasn’t gone up in price recently. My rational is, just to stay even with the pace of inflation, I need to raise my prices by at least 7 to 10 percent. I didn’t get much pushback on the increases, in fact, I normally try to increase my prices every year.

Most other tax pros I’ve talked to have done the same, some by a much higher percentage. Now keep in mind, I’m certainly not the most expensive preparer in my area, but I’m definitely not the cheapest either.

Preparing taxes is hard work these days. You’ve got to keep up with all the tax law changes, You need to comply with all the IRS requirements, which include, uh, lots of due diligence requirements, keeping client data secure, dotting your “I’s” and crossing your ‘T’s” and now you have to have a written data security plan.

In the end, I only lost one client because of increasing my prices.

#2 Efficiencies

Being organized and staying on top of things, like being efficient is super important. Meaning, you don’t want to pick up a return 5 times because each time you pick up the return, you realize you’re missing something.

Pick it up once, review it, determine if anything is missing, then fire off an email with your request.

So here’s what I do. I look over what the client sent me in the way of information, I look to see if it’s all there. But you can’t always know for sure until you’ve gotten all the way through actually preparing the return. But, I try to do my best and limit information requests. If I know I don’t have all the information, I won’t start working on the return.

One of my mentors, Joe Cass, stresses the importance of embracing efficiencies in your tax business. Look to all areas of your business to see how you can make it more efficient.

Are you constantly sending the same emails? Create email templates so you don’t have to retype the same thing over and over. You can also use a computer app called Text Blaze for text snippets you might use often. On your iphone you can do the same thing with an app called WordBoard. I use these all the time, and the time savings is tremendous.

Have a process, and follow that process. For example, here’s mine:

1. I have clients send me their tax documents. When I’m ready to work on it, I review it and come up with, this year’s pricing.
2. Next, I send them an invoice via QuickBooks, along with an email with standard questions for the year.
3. I don’t work on a return until it’s paid, period. I’ve been stiffed before and it’s not a good feeling. Plus I don’t want to waste any time chasing down money people owe me.
4. I prepare the return, ask any clarifying questions or requests for missing information.
5. I upload the return to my client portal, and after they approve, I get their signatures electronically.

Done, it’s an efficient five step process. Create your own process efficiencies and stick with it.

#3 Embrace Technology

So, you can say that I’m good with tech, after all I do own the blog, The Tech Savvy CPA. But seriously, technology is your friend. Embrace it.

I bill my services as virtual tax prep, meaning, no in person meetings are necessary. I have clients upload their documents to my client portal. I have regular backups of my tax software, backups of my client files, which are mirrored to an encrypted cloud storage service, just in case.

I have a really good high speed scanner, and I scan in everything a client gives me. It also helps to have a super fast HP printer.

A lot of tax professionals swear by Tax Dome, which is an all-in-one platform for tax, bookkeeping, and accounting firms. It’s billed as a simple, powerful workspace to manage your practice. If I didn’t already have my tech stack in place, I would jump on Tax Dome in a heartbeat. With Tax Dome, you can lock a tax return until the invoice is paid, you can create all sorts of automation efficiencies, you can use the platform to collect electronic signatures as well.

Check it out, it’s really the best solution out there right now, and I have a referral code in the description.

#4 Stop Answering the Phone

This one’s a bit controversial, but it works for me. I have my business line go straight to voicemail. I work for myself, with no employees, but I do hire assistants and contractors as needed.

You see, I don’t want to be bothered with phone call interruptions while I’m preparing tax returns. You lose track of what you were doing, and it increases the likelihood of mistakes.

Other tax pros, have a virtual assistant answer calls, and make appointments. Whatever you do, don’t let yourself get bogged down with phone calls. Most of the time they’re time wasters, price checkers and procrastinators.

Not all the time, but if I were to actually answer the phone during tax season, maybe one out of ten calls would be what I would consider an ideal client. Now if you’re looking to build your practice, then you need to answer your phone.

I also indicated on my website that I wasn’t accepting new clients and that if you were really interested in working with me, then you needed to fill out a form to be placed on my waitlist.

This worked surprisingly well. Anyone who contacted me on my waitlist form, was ready, willing, and eager to work with me.

#5 Prioritize Your Health

Okay, this might sound stupid, but I think one of the reasons this was one of my easiest tax seasons, is because I prioritized health and wellness.

I know it sounds cliche, but two tax seasons ago, I thought I was having a heart attack. My heart was pounding out of my chest. I could feel an irregular heartbeat, and I couldn’t calm myself down.

I had to go to the emergency room, during Covid, and get that awful test were the shove a needle through your nose into your brain. It was excruciating.

I did all their tests and eventually passed. Ends up I was consuming too much coffee and alcohol, which raised my anxiety levels. Along with high levels of stress that go along with tax season, it was a recipe for disaster.

So, going into this last tax season, I knew I had to take care of my health first and foremost.

Leading up into tax season, I started going to the gym and getting more active. My gym has massage chairs and a hydro massage bed that I used quite frequently to de stress, and relax overall. Just walking on the treadmill, stretching, and light workouts has made a huge difference in my life.

I felt better, more relaxed, and I could function better. I also made it a point to get enough sleep. I also cut out alcohol, and limited coffee to one cup per day.

All in all, I would say it was a very successful tax season. My revenues were up, and I wasn’t ever overwhelmed with work. I’m also thankful that I have a supportive family.

Thanks for reading, and see you in the next blog post!