Accountants and income tax preparers were thrown through a loop last year when the coronavirus pandemic hit just as the busiest part of their season was starting.
They quickly adjusted by hosting meetings with clients over Zoom, sending sensitive information through secured portals and making sense of new economic programs.
While it wasn’t easy, Frederick accountants are thankful for one thing: They’re prepared to do it all again this year.
“I think we’re still gonna have a lot of that same turmoil. The difference is that we’re gonna be prepared for it this year,” said Kevin Hessler, CPA and principal at LSWG in Frederick. “Last year, we got everyone working remotely within a day or two. Now we’ve had a year to work on it, so things should go smoother.”
Many accountants, like Barbara Keeney, also a CPA, had to cancel all in-office appointments that are usually a mainstay of the filing season. Instead, her clients had to drop off files or email them, which Keeney said took some time getting used to.
Burt Speer said he quickly had to adjust to working on Zoom and having clients send all of their files through a secure portal. While many people still prefer paper files and meeting in person, the CPA said it seemed many clients were moving in a more electronic direction anyway. One advantage is the files can stay in the portal for years at a time.
“So if I send my clients their year 2020 tax return, and two years from now they’re trying to get a mortgage, they can just go to the portal and download it without having to find the old return,” Speer said.
Keeney said she hasn’t pre-scheduled any client meetings this year like she would have in previous years, but she’s still giving clients the option to meet in-person if they would like.
“We’re entering the unknown at this point, I think, as to what will transpire this year,” she said.
Despite functioning as mainly online businesses now, CPAs do not feel as if they have any reason to worry that their clients might choose an online program like Turbo Tax over their services. Hessler said most of his clients have more complicated tax returns, and having a professional to speak with — even if it is over Zoom — is typically more helpful than doing it alone. Spear agreed, comparing it to when individuals choose to seek other kinds of professional help.
“If your toilet’s leaking a little, you go to Home Depot and you buy a part you put it in,” he said. “But if you got a major plumbing problem, you probably should call the plumber.”
While there weren’t many tax law changes last year, CPAs are well aware that the new federal administration could implement new tax laws quickly after taking office later this month. Hessler noted that while he keeps a close eye on the news, his clients should, too.
“One of the things that I think is different now than a it was few years ago is things can change on a dime,” Hessler said. “For instance, the (Paycheck Protection Program) changed multiple times.”
Speer said clients with installment sales generating capital gains should also keep an eye on tax laws to see if the rates increase or decrease before filing.
“Because if capital gain rates are increased going forward, you may want to pay the tax earlier at the lower tax rate, rather than deferring the tax into a year where the capital gain rates are higher,” he said.
However, he urges taxpayers to get their tax information in as quickly as possible to their accountants this year. While he’s not sure the federal government will extend filing deadlines again this year, he thinks it’s a good rule of thumb to be prepared.
Keeney advised to file electronically whenever possible, and to set up direct deposit with the Internal Revenue Service (IRS). She said there are many tax returns that have not been processed last year.
“If there are payments due it’s best to do it direct because there are checks that the IRS has and has had for a long time that have still not been cashed,” she said. “So, the more you can do electronically the better.”
Follow Erika Riley on Twitter: @ej_riley