How Capacity Planning Can Help Take Some of the Suck out of Tax Season


Ok. Stop. Take a breath. You did it. 2 straight years of tax season. None of us signed up for this, but when our clients need us, we find the strength and perseverance to help them. Take a breath. Pat yourself on the back. You earned it.

And after you catch your breath, let’s start thinking about how to never, ever, ever do that again.

There are a lot of places that we can look for improvement. Most will depend on what you are willing to change, what you’re already doing, and your mental capacity to dig into the changes you want to make. Not all of you are there yet, and that’s ok. The stuff that follows can be implemented after 10/15, 4/15, or any other deadline that you want to set. When your brain can handle the workload a change requires, dig in and smash it like you have every time a challenge has found you.

The overarching theme is that with some up-front capacity planning, you can find the spaces in your overpacked schedule where you can prioritize what you want to be doing. There is more work than people to do it, which puts you at the advantage. You can decide what you want to do when. I know, there are pressures from all over the place to help so many people. Consider this: just because you can do something does not mean you should. What if you used more of your time for the projects you enjoy, for the clients who value you, to purposefully remove headaches from your world – with the goal to increase your personal happiness?

So, tactics, right? What do you do? I’ve gone through this a few times planning tax season work. I won’t lie, the first time is hard, but worth the effort, especially when you consider the cumulative effects. You need to pull a few reports from your time entry / workflow software. The data you’re looking for is when did the clients drop off the info, when did you do it, and when was it delivered. The key metrics to look at: average turn around time, specific weeks with too much work (probably around 3/1 – 4/15 for most of us), your ideal maximum hours worked in a week, and your gut feeling when you read the client’s name (this might be the most important metric for this exercise).

Now look at the data closely with your ideal maximum hours in mind. There is probably time in February that is underutilized, and time in March that is over-utilized. Look at the March clients. Find the ones that you know could be ready in February and call them. Tell them you’re looking to even out your workload over the three months and could they be ready in February. You know the cash basis pass-through entities can be ready, and you can start cranking through those right after finishing off payroll / 1099s in January. You just smoothed out March a bit by moving the work earlier.

Now look at what is left in March. Read the client names. Which ones make you throw up a little in your mouth. Send them a letter that they need to find a new tax accountant. Yes, it’s blunt. But, really, with how much the last two years have sucked, and how much work there is to do, you get the privilege to be choosy. Your physical and mental health demands it and is worth it.

Now how do March and April look? More manageable than before, but how close are you to that ideal number of maximum weekly hours you set earlier? If you’re over that number, stay calm. You’ve done a heck of a lot of work so far to make 2022 suck less. You’re in better shape already. A way to get into great shape is to look at some automation tools / outsourcing. The right tools for each practice will vary, but here are a couple that I’ve come across: scan-OCR-auto flow for 1040 supporting docs that dominates 1099-Bs, especially w/ hundreds of trades and the foreign dividends / tax credit info. The company also has onshore preparation outsourcing at about an experienced staff level. There are also numerous bookkeeping automation tools out there for the disorganized business clients. And since you created some capacity through the earlier exercises, you may be able to pick up some non-tax season consultative work to help your favorite clients with that automation.

There is no silver bullet or magic answer to fix workload compression around deadlines. It is a host of changes that all impact your time – how much of it you spend working and how much of it you spend not working. As long as the changes and answers you choose put you in harmony with that equation, you are successful. If you feel out of whack, it could be time for some significant changes. The timing of the changes, and their rewards, is up to you.

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