New twists on an old tool: Tax pros revamp organizers

A major tool of pre-season planning is getting a new spin — or two or three — this year. A new breed of organizer, with its new breed of questions, has been born.

The pandemic is unquestionably influencing organizers this year in terms of both content and delivery, in addition to dictating other pre-season plans.

“We’ll certainly be asking questions about receiving a Paycheck Protection Program loan, unemployment compensation and the impact of COVID on personal income or business operations,” said Chris Hardy, an Enrolled Agent and managing director at Georgia-based Paramount Tax and Accounting.

“We’ll have multiple questions for all businesses regarding the various components of the CARES Act and other stimulus-type grants and loans,” said Ann Etter, a CPA and partner at Goodney & Associates, in Northfield, Minnesota.

“‘Were you affected? Did you or someone you know get it? Did you take a COVID retirement distribution? Did you not take or put back your RMD into your IRA?’” said Daniel Henn, a CPA in Rockledge, Florida. “This and a few similar questions.”

“I’m certain there will be additional conversations about the business use of home options and, for the self-employed, impacts of any CARES Act or similar benefits,” said Daniel Morris, a CPA and senior partner at Morris + D’Angelo CPAs in San Jose, California. “We’ll ask about impacts associated with COVID — unemployment, health costs, additional life changes.”

Said EA John Dundon, president of Taxpayer Advocacy Services in Englewood, Colorado, “I will for sure be adding a question about whether the taxpayer contracted COVID.”

New expectations

Getting organizers out to the various categories of clients is the most time-consuming task of early season, preparers have said, though going paperless can whittle down some of the chore.

The organizer of Why Blu in San Francisco, for instance, is all digital, said Scott Hoppe, CPA. “We’re using a shared PBC list … to coordinate open items with each other,” he said. “We supplement that checklist of documents with a short Google Forms survey to answer things like, ‘Did you get a PPP loan?’”

“Organizers will likely be more digital this year as people are certainly accustomed to the COVID digitization of their lives,” Daniel Morris said. “For our West Coast customers, we’ll also be requesting more information about disaster zones and disaster impacts upon their lives.”

“My cover letter is setting a new expectation for meeting and virtual meeting options,” said Kerry Freeman, an EA at Freeman Income Tax Service in Anthem, Arizona. “We’ve always been a live-interview office, with a lot of face-to-face time with collection interviews and closing interviews. This year we’re moving at warp speed to go more virtual and [to a] more mail-and-drop office.”

“Directing clients to online portals, to online appointments with the options of the phone or Zoom meetings has been a big part of my off-season,” Freeman added.

Waldo Swiegers/Bloomberg

Additional uses and topics

In a recent Accounting Today article, Kyle Walters, a partner at L&H CPAs, wrote that his firm doesn’t ask new clients to complete the organizer prior to the first meeting but instead suggests using the organizer to show clients how your firm will work with them long-term.

“The annual organizer is dead — long live the engagement kit,” wrote Walters in another article. Firms should use their organizers to keep their brand front of mind with clients long before Tax Day, and include such extras in organizers (a.k.a., “engagement kits”) as tax updates, significant changes to the firm over the past 12 months, services the firm offers that clients might not know about and tax-planning items.

Other recent events have influenced organizers as well. Thomson Reuters, for instance, brought out a solution to provide virtual currency organization for 1040 prep, as the IRS has added a prominent question on the form around whether an individual has invested in cryptocurrency.

“My organizer, which is accompanied by my engagement letter, will be similar but highlight cryptocurrency questions, remind people of the $300 deduction for charitable contributions and to include the 1444 Notice that they received telling them the amount of the stimulus payment,” said Morris Armstrong, an EA and registered investment advisor at Armstrong Financial Strategies in Cheshire, Connecticut. “And it will highlight that face-to-face meetings are not on the cards.”