Your tax tech stack for 2022


Technology was adopted by more firms than ever out of necessity during the pandemic. Firms that still operated with in-person meetings and paper documents quickly had to find workarounds to not halt their workflow.

The IRS has not added any significant layers of efficiency, still dealing primarily with fax communications. Outside of switching to video conferencing and paperless document management, what is the tech stack of the future for tax practices?

One of the side effects also of the pandemic is the expectation of instant answers and results for the things we are looking for. Amazon could drop ship what we needed to the house; video conferencing meant we could stack more meetings in the day without having to account for travel time.

If everything can instantaneously be provided to us virtually, how do tax firms respond?

Clients already struggle to understand the preparation and review process and often do not see the value in a CPA or EA as compared to a preparer who simply enters data into a return. A thorough review takes longer but often is looked at with more of an advisory lens. But in a highly competitive job market, where there is already more work to go around, how do we continue to provide our clients this level of service without burning out from overload?

Your practice needs workflow solutions for reducing errors in returns, speeding up compliance procedures, streamlining client communications and improving the ease of document sharing without losing security.

Tax preparation software is a key place to start. Reducing inaccuracies or issues that may give rise to a notice, later on, are a front-line way to improve efficiency through technology in your practice. Best comprehensive software include Tax Act, ATX, TaxWise and CCH ProSystem Tax. Before analyzing based on price, look at reviews based on ease of use, comprehensive diagnostics, databases for research, and customer support.

To help improve resolution response times and overall compliance support, consider a tool like Canopy’s API integration with the IRS database. Canopy’s tool allows for your team to receive notification that a client will receive a notice from the IRS before it’s even sent out in the mail. What’s more is Canopy also has a comprehensive database of notice response templates to make responding to notices faster and easier for you and your team.


Canopy also is a great solution for ease of document sharing and improving client communication. Client communication often is the No. 1 complaint of clients looking to change firms. They did not hear often enough from their previous professional services provider. Look for a document-sharing system with mobile applications to make it easy for your clients to send you their documents.

Apps that allow them to take pictures and upload from their phones will ensure you receive the information faster.

Additionally, a tool that allows you to communicate back quickly and easily with your clients is critical. They want to know the status of their return, so looking for a CRM that allows for more than just document sharing is helpful in many ways. Karbon is a tool similar to Canopy that provides both.

Other document sharing systems still redeemed in the tax world include Dropbox, ShareFile, and Huddle. CPA firms have very clear rules around document security and protection though, make sure your IT team signs off on any document sharing system you use, that it essentially follows HIPPA guidelines for protecting personal information.

Other software to consider are tools like Lumatax and Avalara to help you and your team efficiently address sales tax and nexus issues for clients. If you have a larger e-commerce client base, which was a fast-growing industry during the pandemic, you’ll do well to offer sales tax nexus studies as an ancillary service to your clients.

Lumtax makes it easy to examine nexus issues for your clients by connecting to their point-of-sale system to analyze the data. Sales tax returns can then be fed to Avalara for filing.

Tax Planner Pro is a great tool for supporting your tax planning and advisory functions. Projections can take time and often get kicked down the priority list when there is a larger backlog of actual returns that need to be filed. This tool can make it easier to keep up with planning engagements as it connects directly to client accounting software like QuickBooks or Xero and provides aesthetically pleasing dashboard reports to review with your clients.

Hard deliverables add the perception of value to your purely service-based business in these instances and can help strengthen the relationship with clients who are looking for high touch.

Tech stack choices for your firm will require analyzing from multiple perspectives. I suggest focusing on technology to improve your biggest area of need for efficiency improvement and client communications first as it will provide the most benefit for your dollars within your practice.

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