Solutions to the Top Tax Season Challenges Faced by Accounting firms

From keeping on top of compliance changes to striving to sustain and scale, CPA firm owners face new apprehensions every day. Time crunch, talent shortage, data protection concerns, and scalability issues are some of the biggest challenges accountants and CPA firms face, especially amid the busiest tax season. Dealing with deadlines and last-minute prep work being the typical scenario of the tax season, accountants struggle to achieve a better work-life balance too. Here are some tips on overcoming these shortcomings and making tax season a breeze.

1. Adopt Tech & Automation

One of the smartest ways to overcome the tax season challenges is to increase efficiency by investing in technological advances. Automation and tech can help you with more than tax preparation tasks, especially if your staff is spending too much time on admin work. It is proven that CPAs and accounting firms that invest in tech achieve quicker scalability and growth compared to those who shy away from making the leap. Spending on the latest tax prep software and its upgrading charges is a wise investment when managing a CPA firm amid the busy phase of the year. Cloud-based accounting is yet another demonstrated method of improving revenue and acquiring more clients, as it brings more flexibility to firms via remote and shared access to data.

2. Data Analytics & Forecasting

Although data analytics isn’t anything new when it comes to accounting, it is more prevalent in recent years than ever. Considering the rising demand for accountants with solid data analytics skills, it is evident that data analytics and forecasting tools and professionals with expertise in the same can help firms deal with tax season challenges. Big data analytics enable accountants and CPA firms to gain valuable insights and spot trends. Analyzing and forecasting potential risks can help them plan accordingly to sustain and grow when they navigate the tax season stress.

3. Agile Methodology

This is one of the most preferred ways of managing projects and is one of the smartest ways to increase speed, meet rising client demands, and increase your team’s productivity, especially amid the busy time of the year. Agile methodology is mostly adopted to mitigate risks. By delivering early and collecting feedback, you can cut down the risk of mishaps and help prevent errors and penalties during the tax season. Excellence requires the right process, and in order to mitigate risks in tax preparation, agile is one of the most commonly adopted methodologies by growth-focused CPA firms and accountants.

4. Fostering Employee wellness

Considering how the busy tax seasons affect accountants’ physical and mental health, fostering workplace wellness is critical to retain your talent. Given how talent shortage is one of the biggest challenges accounting firms face, especially amid the busy tax season, adopting such measures can help retain the best talents, so you need not go through the recruitment process all over again. Accounting firms paying more attention to their employees’ mental health and wellness have achieved higher retention rates than those that do not. This can be done in simple ways, such as communicating with them regularly, providing the necessary support, and introducing relaxing activities from time to time.

5. Highest Level of Data Protection

Given how accounting firms are at the most significant risk of data security breaches, it is very important to practice the best standards for data protection. From secure software solutions and cloud-based software to two-factor authentication, accounting firms have been implementing several data protection measures. Another best practice adopted by CPA firms is remote desktop access which helps prevent data breaches considering there is no data transfer or sharing. Growth-focused accounting firms are the ones that take data security seriously and adopt significant efforts to secure and protect data.

Final Thoughts

If you’re wondering if there is a way to adopt all of these ways in a single step, outsourcing is that magic wand you need now. From ensuring data protection to adopting agile ways of working to having access to the latest tech & tools and risk management solutions, outsourced tax preparation services for CPA firms is the shortcut to winning tax season challenges.