Facing Every Professional Challenge with Increasing Confidence Despite the challenges of tax policies and clients’ finances, the Accountants Confidence Index (ACI) continues to show accountants are confident about the economy, with the November 2018 6-month ACI at 59.51, or almost 10 points to the positive. Although many of the respondents to the November ACI think holiday shopping will have a positive effect on the economy, others are concerned about last year’s tax-cut legislation, trade policies and the midterm elections. Accountants face many of the same challenges as many businesses: too much paperwork, trying to expand under the weight of current business, finding quality employees and, specifically, educating their clients about changes to the tax laws.

The Costs in Time and Money of Tax Return Preparation 2017 tax returns were the last individuals and their accountants had to prepare under the old tax regulations. The Tax Cuts and Job Act (TCJA) passed last year is expected to simplify the filing process and provide lower rates for many Americans. Whether the process for 2018 returns (filed during 2019) will actually be easier still remains to be seen; however, it is estimated 8.1 billion hours were required to maintain records, prepare returns and submit them to the IRS for tax year 2017. According to analysis from the National Taxpayers Union Foundation, taxpayers spent an estimated $31.9 billion for software and professional preparation services.

Inside Small Business Owners’ Relationship with Their Accountant Accounting Today’s 2018 Small Business Accounting Insights Survey revealed a disturbing trend: Of the more than 1,000 surveyed SMBs, 468 didn’t use the services of an accountant during 2018, and weren’t likely during 2019.   The good news for accountants is 72% of the surveyed SMBs said they were very satisfied with their accountants; however, 43% said they were “not at all likely” to switch accountants during 2019 and 16% somewhat/very likely. Being a trusted advisor was the most important attribute SMBs wanted in their accountant, at 78%; followed by responds quickly, 74%; understands my business/ industry, 74%; and affordable, 70%.

Adapting to the Millennial Market As the largest generation, Millennials will be the primary clients of accountants for decades, so understanding their current financial situations and their attitudes about finances and taxes, specifically, are important.   It may be because of their youth and/or fewer Millennials are marrying, having children and buying homes than other generations, but only 17% utilize the services of a tax professional, compared to 29% of other age groups. According to EY’s The Millennial Economy 2018 report, 50% think they are paying their fair share of taxes, but 35% think they are paying too much, especially among older Millennials, at an average of 39.5%.

A Retail Tax Preparer Seemingly on Every Corner The top 3 franchise tax preparation services continue to be H&R Block, 10,682 locations; Jackson Hewitt Tax Service, 5,837 locations; and Liberty Tax Service, 3,768 locations. SiempreTax+ specifically serves the Latinx American community, with 117 locations. According to IRS data, a paid preparer, which also includes accounting firms, helps prepare 56% of forms and 34% of taxpayers use tax preparation software. The National Taxpayers Union Foundation estimates the average fee H&R Block charged during 2017 was $237.81, compared to an inflation-adjusted fee of $87.56 during 1980.

Advertising Strategies As tax time approaches, suggest to your news director and/or promotions director the inclusion of a news segment with a local accountant to share important information and tips. Re-purpose this video as content for your station Website and/or social media platforms. Given the large percentage of people in various occupations who influences decisions about accounting business services, as presented on page 4 of the Profiler, larger accounting firms may find advertising on your local news to be advantageous. Tax preparers, especially those who are Millennials, may be able to reach their peers with targeted messages during late-night TV, emphasizing how they understand the special financial and tax needs of young adults.

New Media Strategies Influencer marketing could be of particular value for accounting firms, especially when targeting Millennials. Offer an incentive to one or more clients in this age group to share tips and important financial lessons they’ve learned on social media, especially in short videos. LinkedIn is probably the best social media site for accounting firms and tax preparers, as it provides opportunities not only to create a network and relationships, but also provide valuable information in the form of LinkedIn posts. Proactive participation in the community events and causes is excellent publicity for accounting firms and tax preparers, providing them with a more human persona other than “pencil pushers.” Capture these events in photos and videos for social media posting.