Doesn’t it feel amazing to keep ticking things off the checklist? No matter how beautiful the feeling is, it is not half as easy for tax professionals as we make it to be. The tax season is brutal for them — it has been that way for years. But with talent shortage becoming an integral problem of the finance field, things have become harder. Endless work hours and non-stop workload are exactly what the scenario is for these professionals.
While the crippling and sinking feeling is genuine for small tax firms, it doesn’t have to be this way. And workflow management lies at the heart of stopping this gruesome process. The first step in workflow management is ruthless prioritization. It is easy to get overwhelmed by the gigantic amount of tax forms that need to be filed. But it is all about choosing the right approach. Before the next tax season arrives, let us get ready so that you as well as your clients sail through without hitting troubled waters.
In this blog, Finsmart Accounting – trusted globally for outsourced bookkeeping services – will unravel how a strategic approach toward workflow management can go a long way in helping tax firms stay on the path to success.
Identification Before Prioritization
Under pressure, all tasks seem important and urgent. But that is rarely the case. While receiving a push from your clients, and other stakeholders is common, it is important to take a step back to analyze. Prioritization can happen when you have identified the most common questions within your firm.
– What are the tasks you do every day for your clients?
– What is the frequency of these tasks – daily, weekly, monthly, quarterly, or on an “as and when asked” basis?
– Are there internal and external deadlines?
– How do you define deadlines?
– What information do you need to complete a task?
– Is your task dependent on others?
– How many stages does your task have?
To map the workflow for your team, it is incredibly important for the firm leaders to identify and understand how your team works and what strategy can you adopt to map the workflow.
Categorizing Tax Forms to Manage the Workflow
Segregating tax forms and prioritizing them in the right way is key to an effective workflow management strategy. The key here is to identify the primary tax forms that you cater to and are relevant to your organization. Consider factors like frequency of submission, complexity, and potential penalties for non-compliance. This will help you get a clear idea on what is the aspect that you need to focus on.
Not being able to prioritize the forms doesn’t just prevent the team from working on an efficient workflow; it also means there is a chance of tarnishing relationships with clients.
Forms can be classified as:
1. Mission-critical forms: Certain kinds of forms like the 1099 series and W-2s demand immediate attention. They can’t be ignored and left for a later time. Besides being critical for complying with the tax regulations, these forms also help comply with tax regulations. They impact the employees and vendors directly. So, these forms should get priority in your tax workflow management.
2. Regular compliance forms: Forms like 941 (Employer’s Quarterly Federal Tax Return) and state-specific employment tax forms might not be mission-critical, but they play an essential role in maintaining ongoing compliance. It is essential to prioritize them as per the deadlines so that clients can avoid penalties.
3. Annual reporting form: Certain forms need yearly reporting but need to be submitted on a less frequent basis. Such forms, like Form 5500, might not need constant attention, but it is key to allocate some time for their accurate preparation. This not only helps prevent last-minute stress and errors but also streamlines a crucial part of tax workflow management.
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Tips to Prioritize Your Tasks
1. Use a priority matrix: Any task that is due soon is considered urgent. However, there is another layer where you have to decide which task to pick up first. There are tools available that help you decide which task to pick up first when the tax professionals have too much on their plates.
For tax professionals, it is important to figure out what can wait and what can’t. Start with the tasks that are urgent and important, and move on to the ones that are not urgent but important. They are tasks that add a lot of value. No matter how many new tasks fall on your plate, don’t be too eager for the tasks that add less value or are not urgent immediately.
2. Use relativity in prioritization: Categorization can help, but not when you have a countless number of tasks. What do you do then? If you have 5 tasks, start by rating them from 1 to 5, 1 being high priority and 5 being the lowest priority. This exercise helps in weighing out the tasks that can be tackled later.
Break down the current tasks into smaller ones. Calculate the dependencies and the amount of time needed to get all things to complete the tasks. This will help prevent any unnecessary hiccups that might arise at the last moment and ensure smooth tax workflow management.
3. Make a task list for the day: Relative prioritization of tasks can become difficult if no new tasks are being added daily. If there are a lot of incoming to-dos, it can be helpful to make a prioritized task list each morning for the things that are in the plan for the day.
Look at the calendar to dedicate the time that will have to be assigned to each of the tasks for the day. Pick as many tasks as you can do, set your expectations, and share the expectations with the stakeholders as well. This will also prevent incorrect planning and last-moment confusion.
4. Focus on the most important tasks: Prioritization can also seem to be one of the most daunting tasks. If you are struggling with this, you might want to try the Most Important Tasks (or MIT) methods. As a part of this, you should choose and get a few tasks done (usually three).
When using the MIT method, anything you do above this becomes your bonus. Move on to the bonus only when you have completed your MITs. If the MITs are done, it is still a productive day, and a sign of smart tax workflow management
5. Pick your focus: If you are struggling to keep your head straight with a lot of overflowing tasks, it might be wise to pick your focus. When you look at your pile of tasks, pick an area of focus – it could be one large task or an amalgamation of several of them that fall under a category. Choosing a single task to focus on helps us stay on track whenever we get distracted.
Best Practices for Continuous Tax Workflow Improvements:
– Automate workflow as much as possible
– Keep running notes during the tax season to capture ideas
– Make minor improvements as you go
– Make major improvements in the off-season
– Seek feedback from employees
Workflow Management Checklist for Small Tax Firms
Workflow management goes beyond work prioritization. While prioritization helps give direction to the tasks, there are more steps that can ensure that the team is and continues to remain on the right track.
– Form categorization: This includes both identification and categorization of the tax forms.
– Workflow calendar: Build a comprehensive workflow calendar that details the deadlines for each of the forms. They should also have buffer time for unforeseen situations.
– Integration with internal processes: Collaborate with relevant departments to integrate tax form prioritization with internal stakeholders.
– Integration of technology: Leverage technology to adapt software and automation that helps ease the workflow.
– Risk mitigation strategy: A risk assessment and contingency plan to manage errors within the workflow.
– Continuous training: Invest in the training and development of tax professionals to keep them updated
– Adaptability and agility: An environment of adaptability encourages professionals to get accustomed to the changing landscape.
Workflow Management Through Prioritizing Tax Forms: Endnote
For small tax firms, it is not just advantageous to have a workflow management approach, it is imperative. As firms strive towards growth, keeping in mind the growth and clarity of the workforce, laying down a workflow that matters becomes all the more important. Building a comprehensive tax workflow calendar, integrating processes, leveraging technology, and implementing risk mitigation are essential parts of a successful strategy. With the right strategy, leaders can ensure that the teams are well-rested and that efficiency and accuracy are maintained.
Want to outsource your taxation and concentrate on tasks that matter? Write to us at connect@finsmartaccounting.com.
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Director Growth Strategy & Alliance
Maanoj Shah is a finance and outsourcing expert with strong Business Strategy and Scaling-up experience. Over the last 20 years, he has incubated multiple businesses and helped build global enterprises in verticals as diversified as hospitality, technology, and healthcare.
