A Positive View of Tax Outsourcing

Source: Possibilities for CPA Firm Leaders, the Blog of Rita Keller

The following is a complete blog entry on July 31, 2008, and is reprinted with permission.

Some do, some don’t. The conversation surrounding the outsourcing of tax work, like most other conversations about change in the CPA world, continues.

Some CPAs and consultants say that firms have cooled to the idea. Yet, I also hear that many firms (large and small) just do it routinely now.

Perhaps, you are discussing it in your firm this summer in anticipation of tax season.

I am providing the following information from a great article by Gary Shamis, Managing Partner of SS&G Financial Services and a prominent leader in the profession. The article, “Should Your Firm Have a Global Strategy,” appears in the June issue of CPA Practice Management Forum (CCH).

Gary Shamis – “At our firm, we outsource 100% of the front-end of all 1040s. We pay a flat charge per return, send scanned information to our strategic partner and receive back, within 24 hours, an organized tax file and a populated preliminarily completed return using our software.

Once we receive the return back in our office, we check, complete and review the return. At our firm, the return never goes back to our strategic partner. (However, many firms use their global strategic partner for total preparation of the tax return.) The professional on the other side of the world has a thorough understanding to the U.S. tax system and process, is of CPA quality and is thoroughly familiar with our software.

At our firm, our $140,000 expenditure saves us over 8,000 hours of time. Looked at another way, this translates to $17.50 per hour. We believe this gives us a huge competitive advantage in pricing and provides a more favorable work environment for our staff—which is ever so concerned with work/life balance.”

Another aspect to consider is that younger staff people want to do things more challenging than preparing 1040s, which is often viewed as simple data entry.

“People only see what they are prepared to see.” — Ralph Waldo Emerson

From Possibilities for CPA Firm Leaders, July 31, 2008, the Blog of Rita Keller, shareholder of Brady Ware, a nationally known regional CPA firm. Rita is also a nationally known consultant, speaker and author on CPA firm management. Visit http://cpamanagement.blogspot.com/.

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