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August 20, 2024 financial

Tax Season 2024 Lessons: What Technology Worked and What Didn't

Tax season 2024 is behind us. August is perfect time to review what worked, what caused problems, and what needs improvement before next year.

What Worked Well

Cloud-Based Tax Software

Firms using cloud tax preparation software had smooth remote and hybrid work.

No VPN struggles. No capacity constraints. Access from anywhere.

Client Portals

Secure document exchange via client portals reduced email risk and improved organization.

Clients uploaded documents on their schedule. Staff retrieved when ready.

Multi-Factor Authentication

MFA prevented account takeover despite phishing attempts targeting tax professionals.

Minor inconvenience saved major problems.

E-Signature Tools

DocuSign, Adobe Sign enabled remote signature on returns and engagement letters.

Faster than mailing documents. Better than printing, signing, scanning.

Cloud Backup

Automated cloud backup protected against hardware failures and ransomware attempts.

Firms needing recovery had recent backups available.

What Caused Problems

Insufficient VPN Capacity

Firms still using VPN for remote access hit capacity limits during peak season.

Slow connections and disconnections frustrated staff.

On-Premise Server Failures

Aging on-premise servers failing during busy season created crises.

Cloud infrastructure would have prevented downtime.

Poor Client Portal Adoption

Firms with portals that clients didn't use still dealt with emailed documents.

Clear instructions and early adoption push needed.

Inadequate Bandwidth

Internet connections sized for normal use struggled under peak tax season load.

Video calls, cloud software, and large file transfers competing for bandwidth.

Weak Password Practices

Firms without password managers had staff using weak or reused passwords.

Created security risks and forgotten password issues.

Security Incidents

Tax-Themed Phishing

Sophisticated phishing emails targeting tax professionals.

Firms with good security awareness training fared better.

Business Email Compromise

Fake executive emails requesting W-2 data or wire transfers.

Verification procedures prevented most attempts.

Ransomware Attempts

Several ransomware attempts targeting accounting firms during busy season.

EDR caught most. Good backups saved those that got through.

Staff Feedback

Remote Work Technology

Staff appreciated remote work capability but wanted better tools.

Complaints about VPN slowness, disconnections, complexity.

Software Performance

Tax software performance critical during busy season. Slow software frustrates.

Communication Tools

Video calls and chat tools essential for distributed teams. But too many communication channels created confusion.

Client Experience

Portal Usability

Clients appreciated secure portals but some found them confusing.

Better instructions and simpler workflows needed.

E-Signature

Clients generally positive about e-signature. Faster and more convenient than paper.

Communication Preferences

Generational differences. Younger clients prefer text and portal. Older clients prefer phone calls.

Improvements for Next Year

Replace or Eliminate VPN

Move more services to cloud eliminating VPN need. Or upgrade VPN capacity significantly.

Consider zero trust network access replacing traditional VPN.

Migrate to Cloud

On-premise servers creating risks. Cloud migration provides reliability and accessibility.

Improve Portal Adoption

Earlier client communication about portals. Better instructions. Incentives for portal use.

Upgrade Internet

Bandwidth sized for peak season use, not normal times.

Consider business-class connection with guaranteed speeds.

Implement Password Managers

Organization-wide password manager preventing weak passwords and reuse.

Enhance Security Training

More frequent security awareness training. Simulated phishing tests.

Better Communication Strategy

Standardize on fewer communication tools. Clear guidelines about which tool for what purpose.

Technology Investments to Consider

Cloud Tax Software

If still using desktop software, evaluate cloud alternatives.

Document Management

Better document organization and searchability. Integration with tax software.

Client Relationship Management

CRM tracking client communications, tasks, deadlines.

Workflow Automation

Automating routine tasks: document requests, status updates, deadline reminders.

Advanced Security Tools

EDR, email security enhancements, MFA everywhere.

Process Improvements

Earlier Client Outreach

Start collecting documents earlier. Technology enables year-round engagement.

Standardized Workflows

Document standard workflows. Technology enables workflow automation.

Better Deadline Management

Automated reminders and tracking preventing missed deadlines.

Planning Timeline

August-September

Review tax season. Identify improvements. Get quotes. Prepare budget.

October-November

Budget approval. Order equipment. Schedule implementations.

December-January

Implement improvements. Train staff. Test before peak season.

Budget Considerations

Technology Investment

Balance cost against benefit. Technology preventing one major crisis pays for itself.

Subscription Costs

Cloud services shift from capital expense to operating expense. Budget accordingly.

Training

Budget for training on new tools. Untrained staff can't use technology effectively.

Measuring Success

For next tax season, track:

Our Services

At Robell Technologies, we help accounting firms implement tax season technology improvements:

Thirteen years serving Arizona accounting firms means understanding both technology and tax season operational realities.

If you need help implementing improvements before next tax season, contact us now. Don't wait until December.

This August

Use quiet time to plan improvements. Tax season lessons fresh in memory. Budget season approaching.

Technology problems during tax season 2024 are opportunities for improvement before tax season 2025.

Plan now. Implement fall and winter. Be ready for next April.