What’s Next After A Roller Coaster Tax Season?
If a typical tax season is like riding a wooden coaster at the county fair, the current tax season has been like strapping into Raging Bull at Six Flags – a crazy looping ride full of twists, turns, and top speed hurling us into the unknown.
During tax season, accounting professionals and tax preparers must balance long hours, crushing demands, and constantly changing standards. In this pandemic tax season, the challenges for accounting and tax professionals are unprecedented. The overwhelming and exhausting demands are a culmination of several elements. For example, initiatives like PPP loans, which are geared to help small businesses in desperate need of financial help, have created new headaches and time demands for accountants. Additionally, the ever-changing tax laws are forcing accounting professionals to spend a significant amount of time educating themselves to keep up with changing standards.
With the IRS sending out weekly updates for more than a year, one Hawaii-based CPA says he spent well over 100 hours in the past 13 months on Continuing Professional Education (CPE) classes related to just PPP and tax changes alone. Those demands take time away from time needed for “normal” work in a profession historically stretched-thin during tax season. And if that wasn’t enough, the endless pandemic-related programs often require updating tax or payroll forms and helping with various relief applications.
“This is the opportune time where advisors and CPAs should be holding hands and having a kumbaya moment,” says Sharif Muhammad, CEO of Unlimited Capital Advisors, in Somerset, New Jersey. Instead, many are howling. The flurry of IRS guidelines is “kind of patchwork,” he says, “and creates gridlock while tax season is in full swing.”
One New York CPA sums up our current tax season this way:
Frustration on the Forefront
Erin Collins, known as the “voice of the taxpayer” within the IRS and before Congress, leads the Taxpayer Advocate Service, an independent organization within the IRS, which helps taxpayers resolve their IRS account issues, advocates on behalf of taxpayers, and works towards systemic change to mitigate taxpayer problems.
In Collins’ blog in late April 2021, she reported that the IRS had only answered 2% of the 75 million phone calls it has received regarding 1040 forms in the current filing season. This translates to many unhappy taxpayers wondering why it’s taking their tax preparer so long to complete their returns. Which in turn creates added stress for the tax preparer in an already stressed environment.
Client Care Challenges
The 2020 tax season has tested every level of customer service. Even the most seasoned professionals are struggling to keep a level of professionalism in the tax season pressure cooker. Some professionals in the trenches are blowing off steam on Twitter, including Nashville, Tennessee CPA Lisa Mays Millman (printed with permission).
Searching For Support
Seeing the need for an outlet for anyone looking for tax prep answers, BEM Financial Services in West Haven, Connecticut created a Facebook group aptly named “2020/2021 Tax Refund Craziness.” Described as “a place to get honest advice and real tax answers… or vent,” the group’s membership has tripled in the past year to more than 30,000 members, averaging one hundred new members a week. BEM’s group is one of the dozens found on Facebook and LinkedIn that offer an outlet for folks to voice their growing frustration.
The madness of the past 12+ months has another CPA thinking about what’s next.
“As a sole practitioner with 30 years of experience, I seriously need to consider the next season. Our tax system is broken. There is no way to get all the work done in six weeks.”Lisa Millman, Millman CPA Strategic Solutions
Like every year, this tax season will eventually come to an end, and many in the profession will take a much-needed break to reset after the busy season. For some owners of accounting and tax practices, it may be a time to get off the tax season roller coaster once and for all. After all, if you own your practice, the ultimate stress relief to all of this is selling your practice.