Despite the availability of free searches and materials over the Internet, proprietary online tax research platforms continue to grow.“We [do] use free services such as the IRS Web site and the various state Web sites, and they’re very helpful,” explained Jake M. Bodenheimer, manager in the tax department at Atlanta-based HLB Gross Collins. “And occasionally, I’ll Google something. But you have to have access to the services. If you depend solely on the free sites, you’ll miss something. There’s always something different. You pick up something from one service that you don’t get on the other, and merge the information. We have a complicated society with complicated laws.”
HLB Gross Collins subscribes to content from BNA, CCH and Thomson Reuters.
“We made the transition from paper to CD-ROM years ago, and then we went to the Internet. We’ve been exclusively Internet-based for a number of years,” Bodenheimer said. “In addition to being always up to date, it eliminates the chore of filing new releases every week or month.”
All the major publishers of Internet-based research boast stellar growth.
“Last year, Thomson Tax and Accounting was the fastest-growing part of Thomson,” according to senior vice president for new product development Jim Reeves. “We grew 18 percent overall. It reflects the dynamic nature of the environment. But it’s a bit misleading if you draw a line under ‘research’ and put a period there,” he said. “We’re evolving beyond research. We’re integrating with multiple touch points in the customer’s workflow with a platform that covers the three major disciplines that accounting firms practice — tax, accounting and auditing. This gives researchers a single platform, one learning curve for a single set of navigation tools, and one URL.”
In actual practice, Reeves noted, practitioners need to deal with auditing, accounting and tax in an integrated fashion. “In the past, there might have been a bright line between them, but those lines are blurring,” he said. “Research itself is not an isolated activity. Practitioners are helping a client structure a transaction, doing a return, doing deals. Research is part of, but not the, end game.”
Reeves explained that one of the company’s foundational beliefs is the “three-minute concept.”
“Whereas 10 years ago, we were built exclusively around research, now we want to know what the client was doing three minutes before they used the research platform and what they were doing for three minutes after. We tried to build that into the workflow to make it as seamless as possible. At some point we will have the entire workflow covered. Research is part of a greater whole and we’re expanding Checkpoint [Thomson’s proprietary online tax platform] to cover as much of that whole as possible.”
Tanya Rose, director of research product management at CCH, sees this kind of integration as the future of Internet tax research. “What’s changing is the newer generations coming into the workforce have been brought up on the Internet,” she said. “They’re used to Internet best practices. We’re making a huge investment in search functionality and turning best practices into enhancements.”
“We’re looking at new ways of doing things,” added Rose. “For example, when you go to Tax Research Network, you select what you want to access and either menu-walk or search. Now we’re looking to search all, and filter the results afterward by tax type, document type or jurisdiction.”
Internet tax research has become platform-agnostic, as various publishers have made their content available on each other’s Web sites.
“The need for quality won’t change, even though researchers might use Google,” said Holly Flater, product manager for BNA Tax and Accounting. “How they get to the information is of no importance compared to the information itself. Our objective is to give people the option to get our information on the platform of their choice.”
“BNA content is available on CCH Tax Research Network, RIA’s Checkpoint, and LexisNexis and Westlaw,” she said. “We’ve also enhanced our own platform to make it that much easier to get information to researchers.”
CCH’s Tax Research Network, for instance, allows searches not only within CCH material, but also from key industry Web sites. Checkpoint includes access to BNA, Practitioners Publishing Co., and Warren Gorham & Lamont titles. And LexisNexis Tax Center integrates material from BNA, CCH, Kleinrock and Tax Analysts, as well as its sister company, Matthew Bender.
“It’s a matter of choice for our customers based on preference,” said Charles Ter Bush, vice president and managing director of tax and accounting at LexisNexis, which added its own Tax Advisor last year and is adding state commentary from over several hundred authors who write State Tax Practice Insights, according to Ter Bush. “As of this month we’ll have all 51 jurisdictions covered,” he said.
“Although people use Google in concert with products they pay for, accountants and lawyers are under productivity pressure,” said Ter Bush. “They really can’t afford to mess around with a hit-or-miss method. Productivity is an incredibly important problem for tax professionals, especially in corporate tax departments. The profession is not growing in terms of head count, commensurate with the workload they’re increasingly being asked to shoulder.”
Sarbanes-Oxley imposed greater burdens not only on the calculation of tax but also on additional processes that have to be documented, he noted.
Both RIA’s Tax Alerts and CCH’s Client Relate integrate tax compliance with tax research by identifying clients affected by particular developments.
“It makes sense to people, especially if you want to increase revenue from a specific customer or gather customers for new services,” said Rose.
“Tax Alerts is integrated with GoSystem and InSource, and we’re working with Ultra Tax to increase integration,” said Ron Burkert, Checkpoint’s director of product management. “If you’re on a line on a return in Ultra Tax and you click on a link, it will bring up tax articles related to the form and the line on the form.”
CCH has kept its acquisition of Kleinrock on its traditional platform, according to Rose. “Customers that purchase Kleinrock get access both on a CD and via the Internet,” she said. “It complements our traditional CCH offerings nicely, by offering analytical and primary source material at the right price for the very small firm.”
“It’s a challenge to make sure that we’re meeting the needs of new entrants to the profession while we meet the workflow needs of our long-term CCH users,” she added.
Tim Doyle, senior product manager for Intuit’s free, wiki-style Tax Almanac, sees the free services as an adjunct to, rather than as a competitor of, the proprietary platforms. “There’s still a need for tax preparers to get authoritative content to validate and do in-depth research,” he said. “But the community aspect will grow and allow preparers to quickly and easily get answers. You can go to a paid-for platform and get answers, but researchers often aren’t sure if the answer matches their situation. With Tax Almanac, everyone can pitch in and offer solutions from their own experience. Smaller preparers have felt they were alone, but with Tax Almanac it’s like walking down the hall and bouncing an idea off a colleague.”
“It’s also product-agnostic,” he explained. “We don’t filter material when competitor products are being discussed.”
“It leverages the power of the tax community,” added Jorge Olavarrieta, product manager for Lacerte.
On April 14, 2008, its busiest day to date, Tax Almanac registering over 20,500 unique visits. “We have visitors from 154 countries around the world,” said Doyle. “The U.S. is the largest, of course, but we have heavy volume from Canada, the U.K., India, Germany and Japan.”
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