Some tax practitioners may say the 2020 tax season was one for the books, literally, with extended filing deadlines, working remotely, and dealing with COVID-19. How will the 2021 tax season differ from 2020? I asked several members of the ProConnect™ Customer Council for their advice; here are their responses.
Matthew Hague CFP®, EA – Guide Wealth Management
In 2020, we did whatever we could to help keep our business and personal clients solvent. Many of these things will create complexity in 2021. For example, clients may have taxable unemployment income, which may require that we make elections to offset estimated tax penalties. Businesses have PPP claims, the tax treatment of which may still change. Others may have a COVID-19-related IRA distribution. All of these will be new to the client, so it is our job to keep them informed of how these items will be reported, and to ensure they benefit from the optimal elections. Overall, a lot more work will be done in 2021 than in prior years, but it’s worth it.
Caleb Jenkins, EA, CQP – RLJ Financial Services, Inc.
The 2021 tax season will likely bring new tax legislation similar to 2018 and 2019 when the Tax Cuts and Jobs Act was introduced. Embedded in the COVID-19-related relief bills is a ton of tax-related legislation, and one of the biggest items is the PPP loans.
One of the changes we are going to be making is pushing more and more Zoom meetings with our clients instead of in-office appointments. We also are using Loom to record a 5-to 10- minute results video after we are done with the return. We’ve had really good responses these past few months on these Loom videos because it allows the client to watch them on their own time and share it with their spouse, rewind/pause, watch it again for clarity, and save the video for later in the year when they want to review their situation. These changes better allow us to work virtually, on our own time, and in a way that is mutually beneficial to us and our clients.
Jamie E. O’Kane, CPA CTC – JE O’Kane CPA
The 2021 tax season will be … interesting. We have many unknowns at the moment with legislative changes. The COVID-19 provisions will complicate, as well as potentially delay, filings for many taxpayers. For the 2021 season, we will be implementing more streamlined processes and systems for gathering client information, as well as doing more virtual one-on-ones with clients to ensure our understanding of their returns.
Christopher J. Picciurro, CPA/PFS, MBA, ARA – Integrated Financial Group
Controlling our workflow, and not letting our workflow control us, is a pillar of our firm’s culture. Since we operate exclusively on a membership-based subscription model, we put as much emphasis on tax planning and strategy as preparation. We feel that tax season is a year-end process instead of a specific period of time. Our biggest challenges with tax preparation is efficiently obtaining, organizing, and entering client source documents in an accurate fashion.
That said, our biggest change for 2021 will be creating customized client document requests for tax preparation, and standardizing our internal file structure for all tax return source documents. This will be a challenge because many clients upload different document types, including W-2s, 1099s, and 1098s, within one PDF. We are confident that our new processes will empower all team members to review, analyze, and place source documents in the appropriate place internally.
Timothy Wingate Jr., EA, CTC – G+F Business & Financial Consulting LLC
The 2021 tax season is really unpredictable because of this year being an election year. We don’t know if there will be more stimulus payments issued and we don’t know the effects of everything that transpired in 2020. My goal is to get my clients prepared now, with tax planning services. Making sure we close out 2020 properly will ensure we will have a smoother 2021 tax season.
How do you think 2021 will be different? Leave a comment below to share your thoughts with others.