december2021 - 5

FEATURE
Evaluating the New Tax Season Normal for
Tax Advisors
By Jim Guarino, CPA, PFS, CFP®, MST
I WAS RECENTLY asked if I thought the upcoming tax season
will represent a return to normal for tax advisors and their
clients. To be honest, I thought, " What's normal anymore? " If
normal can be defined as adapting to perpetual change, then
the answer is an emphatic " YES! " Or, as New York Yankees
legend Yogi Berra once said, " It's like déjà vu all over again. "
In fact, I contend the 2018 tax
season was perhaps the last " normal "
busy season encountered by
tax professionals (2017 tax returns
were filed based on pre-Tax Cuts
and Jobs Act of 2017 tax law). Since
then, each subsequent tax season
has been demanding, challenging
and for some tax professionals,
career-altering...a bit more on that
later. All tax professionals have been
impacted. Perhaps the only tax season
attribute that can be considered
" normal " for tax advisors nowadays
is to expect the unexpected.
When I reflect back on recent tax
seasons it is quickly apparent how
chaotic it has been to be a tax professional
since the passage of TCJA.
For example, the 2019 tax season
involved the first busy season
filing (2018) tax returns under the
new TCJA tax rules and with it, a
significantly revamped Form 1040.
Not only were tax advisors dealing
with interpreting new tax law (arguably,
the most significant since the
Tax Reform Act of 1986) but also
new tax forms. This was occurring
while TCJA tax law integration was
still being processed by the Internal
Revenue Service. As a result, many
client tax returns were extended and
submitted at the October 15th filing
deadline, rather than the standard
April 15th deadline.
I suspect the 2020 and 2021
tax filing seasons need no further
explanation other than to mention
COVID-19 and the wave of tax
law legislation (CARES Act) that
was rapidly passed to deal with
pandemic-related strains on businesses
and individuals. Initially,
tax advisors were required to
learn, interpret and implement new
tax law on the fly just as the 2020
busy season was hitting full stride
in March. Adding to this was the
extension of the traditional April
15th due date to July 15th and busy
season 2020 morphed well into the
summer vacation months. And the
2021 busy season was slightly less
tumultuous but not without its own
share of pandemic-related adjustments,
including another April 15th
deadline that was extended through
May 17th for this past year.
Simply put, after the past three
tax seasons, many tax professionals
are exhausted and drained. The
effects are sobering. The profession
is seeing escalated levels of attrition
at all non-partner ranks, and the
pipeline of first-year staff entrants
into the field seems to get smaller
each year. Rather than aspiring to
be promoted to tax partner, younger
tax professionals are questioning if
a career as a tax advisor in public
practice is sustainable and whether
work-life balance is realistic.
The partner group is not
immune from the consequences of
the past three tax seasons either.
Many experienced practitioners
have re-evaluated their own circumstances.
Some have opted to retire
earlier than planned and others have
abandoned their own succession
plan (including patiently grooming
the next generation tax advisor)
and instead have sought out merger
opportunities with other firms.
So, how do we reverse this
trend? The solution might be one of
the few positives that emerged from
the pandemic: The enhanced use
of technology and a remote/hybrid
work environment. Similar to many
other service providers, tax advisors
needed to adapt to a new normal as
a result of the pandemic. For the
tax profession, that meant pivoting
to a remote office environment,
integrating a hybrid workforce and
implementing a near 100% virtual
tax engagement service model for
clients in just a matter of weeks.
Clients have adapted to this new
normal as well. Individuals appear
to be getting more involved with
their own tax planning and seeking
tax advisors who are conversant
with legislative changes and tax
saving strategies. Clients understand
the impact of saving taxes. They
want to work with tax advisors
who remain knowledgeable about
tax law, regardless of how complex
it becomes or how frequently it may
change. Personally, this is what
makes being a tax advisor so fulfilling
for me - answering the challenge
of each busy season, be it a normal
tax season or some iteration thereof.
Bringing this discussion full
circle then, the hope is that this
upcoming tax season will be a bit
more traditional,
in effect, more
normal. Tax advisors and their
clients are now accustomed to the
routines of remote work, Zoom
calls and paperless tax preparation
services.
To successfully navigate this
coming tax season, we need to continue
to embrace the changes that
we all made to provide tax services
in the first year of COVID-19. We also
need to ensure we are continuing to
engage our clients about their tax
and financial situation, even when
we're communicating remotely. A
strong relationship between advisors
and clients has always been critical
to success.
As we approach the end of 2021,
we are again confronting developments
that have recently become
all too familiar. The world is once
again feeling anxiety over another
COVID-19 variant and potential new
tax legislation is being considered
and debated by Congress. Buckle-up
fellow tax practitioners for another
year-end of busy season anticipation...
as the saying goes, the more
things change, the more they stay
the same. As Yogi said, it really does
feel like déjà vu all over again. ■
Jim Guarino, CPA, is a managing
director at Baker Newman Noyes. He
specializes in serving high net worth individuals
and families as well as closely
held businesses and their owners.
DECEMBER 2021 ■ www.CPAPracticeAdvisor.com
5
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december2021

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