A COUPLE OF QUESTIONS FOR FELLOW TAX PROS

 

I came upon an interesting topic for discussion while reviewing the August issue of ACCOUNTING TODAY at dinner last week.

 

What caught my eye was a highlighted quote from Chuck McCabe, president of Peoples Income Tax and The Income Tax School, from Roger Russell’s article “Filling the time between April 18th and January” –

 

“It’s a good idea to provide multiple services.  The more services you provide, the less likely your clients will be to leave.  Retention rate is critical.”

 

Back in 2009 I first published a post on advice to those starting out in the accounting world, which I have included in my new e-book SO YOU WANT TO BE A TAX PREPARER (read a review of this book by Andy Frye of PRONTO TAX SCHOOL by clicking here).  My advice involved a song lyric and two advertising slogans –

 

* “You See You Can’t Please Everyone, So You Got to Please Yourself”  

 

* “Only Sherwin Williams Can Cover the Earth”

 

* “Just Say No!”

 

For “Only Sherwin Williams Can Cover the Earth” I said –

 

“When I first began my own practice, many, many, many years ago, I thought that I should offer, either personally or via relationships with consultants in other fields, all kinds of financial services to clients, not just 1040 preparation, so that their tax business could not be stolen away by their insurance agent or broker or another financial professional.

 

Then I remembered what a wise old Texan (my boss at the Summit YWCA) once told me – ‘Only Sherwin Williams can cover the earth’. You can’t be all things to all people. Don’t spread yourself too thin and try to offer the world to your clients”

 

My advice here is the exact opposite of the advice offered by Chuck in the article.

 

Roger’s article concerned what tax professionals do between filing seasons.  One of the things that first attracted me to the tax preparation profession was its seasonal nature.  Ideally you can work 10-12 hours a day, 7 days a week for 2½ to 3 months and only 1-2 days a week the rest of the year.  I would truly be as happy as the proverbial pig in reality tv if that was true for me. 

 

Looking back over my 45 years in the business, if I were to start all over again I think I would limit my practice to 1040s.  Period.  No 1065s.  No 1120s.  No 1041s.  No 990s.  Just 1040s.  Not only to make the yearly schedule I suggested above a reality, but also to limit my need for ongoing CPE to 1040 issues only, and to limit my exposure to agita and liability.  There is certainly more potential for problems with business entity returns than with 1040s. 

 

The article also introduces another interesting concept –

 

“For tax preparers who aren’t interested in expanding their tax business beyond the tax season, but would like to keep themselves and their staff employed in some meaningful activity, some accountants have found a solution – go into another seasonal business.”

 

This is an idea I have thought of over the years, but never followed through on.

 

So here are the questions I ask my fellow tax pros –

 

Do you limit your business to tax, or just 1040, preparation, or do you also offer other services – insurance, investments, real estate, college financial aid preparation, etc, etc?

 

And -

 

Do you have a second, totally different, seasonal business during the summer of other parts of the “normal” year?

 

I am looking forward to your thoughts and comments.

 

TAFN