How to offload your tax prep work

In reply to yesterday’s email, one CPA in Missouri lamented:

“You are correct. So what are you selling?”

Yesterday, nothing. Today… Keep reading. 🙂

The more obvious reply to yesterday’s email is: How does one execute a transition to other service offerings?

For this, I have a straightforward answer. If you’re sick and tired of filing season, pay attention.

First, start **marketing** for your new service offering. It doesn’t matter what time of year it is, what the service offering is, whether you have the necessary tools and tech in place, the lack of relevant staff, your lack of specific skills. None of that matters. Seriously, none of it.

Start. The. Marketing.

Too many accountants get bogged down in the minutiae of setting up a service offering. They spend way too much time evaluating software providers…waiting for the “perfect” time to start…waiting to meet that perfect potential new hire.

Stop waiting. Start the marketing. Everything else will come about from there, out of necessity. Hiring the perfect person or buying the perfect software is absolutely irrelevant without lead flow.

That’s step one.

Step two: Start offloading your tax prep work.

This is far easier than you might think it is. Tens of thousands of return preparers have already done this, and thousands more are going to be doing it each year. There are several options for doing it.

Option 1: Quit cold turkey. Several of our Tax Resolution Academy® have chosen this option over the years. Last year, Carlos Samaniego, EA in Los Angeles chose this option, simply telling clients he would no longer be preparing tax returns. I advise sending a letter AND an email to clients, with a referral to a trusted tax prep colleague (a colleague that you arranged a referral fee arrangement with in advance, of course — always the capitalist!). You could either do this NOW, or prepare returns this one final year and then turn people offer to somebody else.

Option 2. Offshore your tax prep. Like I mentioned yesterday, IPA 100 public accounting firms have been doing this for 20+ years. It’s the *norm* in large accounting firms, because tax prep simply isn’t the most profitable thing these firms can spend their time doing, by a long shot. You need to disclose the fact that you’re doing this, via your 7216 disclosure (which you should already being giving to clients anyway). You then need to choose a Business Process Outsourcing (BPO) company to handle the prep work for you, of which there are many that exhibit at our industry trade shows. Then, either yourself or a staff member handles client interaction, but you’re not doing any actual tax prep.

Option 3. Automate. As mentioned yesterday, the AI technology to do most tax returns has been around for three years. Giant accounting firms have embraced this tech to even replace a lot of offshoring; PwC is probably the leader in adoption of this tech. But you can tap into it, also. Gruntworx will automate much of the work flow for you, saving significant time with each return. SurePrep takes it a step further, and you can actually pay them to just do the entire return for you. Last I heard, it was around $80-$100 to have them do the return, including review. This is a TINY price to pay to offload this task. If you’re charging $300-$500 per return (current national market rate), paying $100 to have it done for you is a pittance — worth every penny so that you can focus your time on delivering more profitable services.

So there you go: The three main options for offloading your tax prep work. Quit, offshore, or automate.

There is absolutely zero excuse for you to not offload the majority of your tax prep workload. If you’re just a cheapskate and refuse to invest the cash into this one thing that will drastically improve your business, then I can’t fix that. The solutions are there, you just need to take action.

Now, it’s time for the 10-second commercial.

I really chose the wrong title for this book. In reality, it provides 8 very important ideas for maximizing the profitability of your entire firm, not just tax season. This book should absolutely be on your immediate reading list if you have any interest in making more money from your business.

Grab it from Amazon here: