Maximizing Tax Season Efficiency: Put Procedures in Place Now to Ensure Smooth Work Flow

Run your firm's tax season as if you were advising a client on a business. Whether you are a two-person operation or a giant national firm, you need procedures to facilitate the tax preparation part of your practice. The following best practices for tax season, adapted from my book Managing Your Tax Season, Second Edition, apply to any size firm: 1. Schedule work flow by coordinating client meetings, client submission of data and staff availability. For non-corporate clients, schedule and prepare returns on a first-in, first-out basis. Call clients and work out times for them to submit information. Tell clients which staff members will be working on the return and give an expected completion time. A two-week completed return policy can reduce the number of client calls, work in process, and scheduling problems, and can help speed up cash flow. 2. Schedule the proper level of staff to prepare returns based on the availability of mentors or trainers and the availability of proper tools. Make sure the staff knows how to make the best use of technology and that they understand the systems and checklists--and the importance of following and using them. Effective tracking of the workload for each staff person and each return is "management." How well you manage ultimately determines the success of tax season--and the happiness and satisfaction of staff and partners. 3. Reduce the number of staff "touches" on returns by streamlining administrative processes. Don't start a return until all of a client's information is in the office; organize follow-up procedures for missing information; and have staff available to complete the returns they started. Time and work-flow systems can help track staff "touches." Monitor the system on a timely basis to manage the process better in real time. 4. Schedule reviewers for big, complicated or difficult returns, and assign returns to the proper level of reviewer. Consider implementing a reviewer qualification test to ensure that your reviewers are prepared to handle issues that arise during a review (see sidebar, "Reviewer Qualification Test"). At a minimum, reviewers should undergo some training on the procedures that are implemented. Establish a firmwide mindset of adhering to procedures. That means partners can't allow skipping steps in the process so a return can get sent out quicker. 5. Examine where bottlenecks exist and don't let returns sit unattended. Often, returns are put aside at the review or assembly stage, with one or two open items that can easily be answered with a follow-up call to the client. Review and monitor the backlog of unanswered questions for returns that are mostly completed and reduce that backlog. Don't let these returns linger. 6. Examine the relationship between time spent on return preparation versus time spent reviewing the return. An unreasonably long review time means the return wasn't properly prepared with adequate and organized documentation. It is less expensive and more efficient to have a preparer put the information in order for the reviewer, rather than having the reviewer plunge through the backup. Requiring extensive, organized and indexed working papers or PDF files may take about 20 minutes per return but can reduce the time it takes the preparer to actually work on the return by approximately 50 minutes, and reduce the reviewer time by about a half-hour, resulting in a net gain of one hour per return. For a workload of 400 returns, this can save the equivalent of one fulltime person during tax season. Also, the removal of a tedious part of the reviewer's work can substantially raise the quality of the review. Note that work flow and scanning software can effectively eliminate much of the time spent organizing and indexing a client's information, providing a very quick return on investment. 7. Try to measure productivity per preparer. Productivity is a measure of results, not time spent. …

Field of study: Business