While there are still plenty of paper manuals in many areas of accounting practice, including taxation, the majority of accountants today have seen the writing on the wall, and gone electronic.
Newer and electronic doesn’t, however, necessarily mean better or easier. Sure, you can submit a tax question to Google and get hundreds, if not thousands, of answers listed. But except for some sources such as the Internal Revenue Serivce and other “official” sites, you can’t be sure that the information that the site contains has been curated, vetted, or is even close to being accurate.
That’s not to say that the Internet isn’t a useful tool. Almost all of the services that formerly required reams of paper and yards of shelf space are now located in the cloud. That provides some immediate and obvious benefits, one of which is that the numerous hours spent on maintaining subscription services can now be used to actually access the subscription. And maintenance of tax, accounting practices and standards, sales tax, and audit libraries is critical. New court cases and rulings happen with alarming frequency.
WATCH THOSE NICKELS AND DIMES
One problem that faces many small to midsized practices is how much to invest in research. It’s easy to be dazzled by the depth of many of the research options. But it makes sense to match the services that you subscribe to against the type of practice that you have. What kinds of returns make up the majority of your work? What kinds of problems have you had to research in the past, and what resources did you finally require? What kinds of (and how many) audits has your practice performed in the last five or so years?
While it’s nice to have a virtual library of code, keep in mind that many federal, state and municipal codes are readily available online at no cost. With most research services, what you’re really paying for is the analysis, and timely alerts about code changes and cases that might have affected your clients.
That’s not to say that comprehensive research services are a waste of money. If you have the kind of practice that requires them, they are a good investment. If, on the other hand, you only occasionally come across a problem that needs to be researched in depth, it may pay to subscribe to a less expensive service.
ZEROING IN ON THE ANSWER
Back when electronic research was just starting to come into vogue, structuring a search was a matter of understanding a few Boolean search terms and a lot of luck. Advances in natural-language search engines have led many practitioners to believe that you can just ask a question and get a usable (and accurate) answer. Sometimes that’s true; more often it’s not. Searching is still more of an art than a science.
There are numerous reasons for this. While the Internet makes it easy to find answers to many questions, the major question left hanging in the air is, “How accurate is this information?” Take a simple example: Go to Google, Bing or any other Internet search engine and type in “Section 1231 Conversions.” Google returns over 400,000 results. Some, such as that quoted on the IRS site or that of Cornell Law School, have a high probability of being trusted sources. With others, including Wikipedia, you simply don’t know where the information is coming from. “So-and-so said this” is probably not an argument you would want to go into Tax Court with.
Another reason why research has gotten more difficult, even as search engines improve, is that the sheer volume of data that needs to be searched keeps increasing.
Considering what is really meant in a section, how it should be applied, and what the proper recourse is when it’s violated, has generated millions of words of findings, case law and analysis. And all that is just from one document and its amendments. It’s hard to wrap your head around just how much tax-related material exists, but if you live or work somewhere near a university that has a law school, stop in at the law library when you have a minute. What you’ll see is a building filled with books and computers. And some law libraries limit their collections to specific areas of the law, such as tax law, criminal law, maritime law, international law and numerous other areas.
With all that facing you, where do you start? It used to be that you structured a search and started with a specific area of the research data such as code, the topical index, case law or possibly analysis.
With the advent of natural-language searching, however, older search methodologies can sometimes be counterproductive. In many cases, the vendor has developed its own method that optimizes the search process and results, so it pays to find out the techniques recommended by the research provider. One thing remains the same: The better you understand what you are looking for, the easier it usually is to find it. Generally, the less detail you can provide in the search, the greater the amount of findings you’ll have to wade through.
Which brings up another consideration; each of the vendors we surveyed stated that their search engine was easy to use. Yet all of them, very honestly, recommend that you take advantage of the training they offer. And we believe that’s an excellent idea. Not only will you often get needed CPE credits, but the better you can use a particular product, the more productive and efficient you’ll be.
Selecting the right research product for your firm requires that you feel confident that the supplier you choose is accurate, has the level of comprehensiveness that you require and can afford, and that you can use the resource effectively and from the multiple devices used in your practice, including smartphones and tablets.
To help you get started in your search, we surveyed four of the major providers of tax research services. Some of them aggregate their products along with products from other vendors, so you get the benefit of a wider range of authoritative sources. Another consideration is your tax preparation software. Many tax prep vendors now provide either a link to specific research services or a compressed version of the service as an option that is linked to specific lines on returns. If most of your research questions come up during the preparation of tax returns, this might be a smart way to implement your research service.
Bloomberg BNA Tax & Accounting
Bloomberg BNA Tax and Accounting Center
As with offerings from CCH and Thomson Reuters, Bloomberg BNA offers a wide choice of research service subscriptions under the umbrella of the Bloomberg BNA Tax and Accounting Center. These consist of portfolios centered on specific areas such as federal taxation and state taxation, as well as practice areas such as domestic and international accounting, estate planning, compensation planning and numerous others. Materials include original source material, such as code and cases findings; Bloomberg BNA is known for its internally generated analytical and reporting briefings. The Tax Management Portfolios, for example, started more than 50 years ago and currently cover over 500 tax and accounting topics. And while much of the material is available in paper format, online subscriptions and searching is going to be faster, more productive, and definitely the way to go.
One of Bloomberg BNA’s stand-out features, according to George Farrah, executive editor of tax and accounting, is the availability of transactional diagrams — “a collection of diagrams that allow you to visualize complex fact patterns found in revenue rulings, cases, and Treasury regulations. This content comes automatically with most subscriptions at no additional charge.”
Also popular is the Daily Tax Report and State and International Tax Development Trackers. Farrah also pointed out Bloomberg BNA’s new Links and pages feature, which lets users search and get key related information very easily.
Numerous in-house and Web-based training options are available, though Farrah feels that most users will be comfortable and productive from the start due to the software’s interface, online help and user guides.
New this year is the 2016 Federal Tax Guide, which provides quick access to succinct explanations of tax law, supported by practical examples, schedules, tables and references to the Tax Management Portfolios. As with offerings from several other vendors, a free trial is available of some of the products.
Wolters Kluwer, Tax & Accounting US
CCH IntelliConnect; CCH IntelliConnect Direct, CCH Mobile
CCH IntelliConect is the banner under which Wolters Kluwer Tax & Accounting’s online library of tax research libraries reside, and forms the core of its research offerings. Wolters Kluwer also offers a different research product, Accounting Research Manager, that is oriented more towards standards and overall accounting firm practice.
CCH IntelliConnect is, in itself, not a research library, Rather it acts as the central access point for the library research products that you subscribe to, eliminating the need to search each product individually. These libraries include federal, state and international tax research, SmartCharts for federal and state taxes, as well as QuickAnswers, answers to the 2,000 most commonly asked tax questions. Wolters Kluwer also has tax planning tools and practice aids such as client letters and checklists.
Complementing IntelliConnect, Wolters Kluwer offers the optional CCH IntelliConnect Browser Search. This browser add-on presents a search of subscribed Wolters Kluwer research products next to an Internet search conducted with the same parameters run with popular search engines such as Google. “With CCH IntelliConnect Browser Search, customers can simultaneously search both the Web and CCH IntelliConnect, see the IntelliConnect results, and then go directly to their CCH IntelliConnect content,” according to Joshua Braunstein, vice president and general manager for Wolters Kluwer Tax & Accounting US, Research & Learning.
CCH IntelliConnect also offers mobile access from an iPhone or iPad, Android phone or tablet, or Kindle Fire with its Mobile app, and training is available in a variety of live and online media in both noncredit and CPE credit courses. Wolters Kluwer also provides a free trial of IntelliConnect.
Thomson Reuters Tax & Accounting
Checkpoint, Checkpoint Catalyst
As with offerings from BNA and CCH, Thomson Reuters’ Checkpoint is not a single product, but rather the encompassing envelope to a panoply of products that a firm can subscribe to. These include Thomson Reuters’ own corporate products from its RIA, WG&L, PPC, Boskage, Orbitax and Westlaw divisions, as well as access to products from other vendors including BNA, IBFD and EBIA, as well as content providers such as the American Institute of CPAs, the major standard-setters, the Securities and Exchange Commission and others. Of course, you subscribe to only those services you anticipate needing, not necessarily the entire menu.
Most of these services include authoritative analysis in addition to code references, and according to Steve Zelman, senior vice president of product platforms with Thomson Reuters’ Tax & Accounting business, users can “make informed decisions with confidence by reaching clear results quickly and efficiently through an innovative and truly intuitive search and navigation system.”
Also available as a member of the Checkpoint family is the Web-based Checkpoint Catalyst. Catalyst integrates an analysis of the requested search presenting illustrated and annotated results that incorporate graphical representations (where applicable) of the findings in a unique format and in a single place, reducing the likelihood of missing something relevant and important. Catalyst also incorporates Checkpoint’s intuitive search to ensure that the results are comprehensive and on point.
As with the other major research services, Checkpoint offers practice aids, checklists and client letters. An IRS Response Library provides boilerplate response documents to speed answering more than 500 IRS notices, forms and letters.
Thomson Reuters offers a free trial of both Checkpoint and Catalyst. When researching a complex subscription service such as this, making use of the free trial offer is a good way of testing just how easy the service is to use, especially if you redo the research on a tough question that you’ve performed in the past. Of course, be prepared for the follow-up sales calls that the free trial generates.
Checkpoint and Catalyst are both accessible from mobile devices, which is almost a necessity these days. Training is free, and is available in a variety of formats.
Parker Tax Publishing
Parker Tax Pro Library
At $342 a year, the Parker Tax Pro Library is the least expensive product in this roundup. With the occasional 20 percent discount Parker sometimes offers, it’s even more so. But inexpensive doesn’t necessarily mean useless.
The Tax Pro Library is the new kid on the block, launched in 2007 and moving to the cloud in 2011. With that move, Parker stopped publishing on paper. One thing to be aware of right up front is that the Parker Tax Library is a federal tax resource. If you need to research state, local, international or sales taxes, you’ll need to do it elsewhere.
Still, Parker gives you a lot for that $342. The library is organized into 22 volumes, with a separate volume added several years ago to address tax issues and credits due to Obamacare, a subject that many practitioners will have questions on. The rest of the 22 volumes address code, cases, analysis and practice aids such as client letters. There’s even a biweekly tax bulletin to keep you on top of current affairs in the tax world.
Of the four vendors surveyed here, Parker is the only one that does not offer training in the use of its search engine. According to Tracy Shannon Levey, vice president of communication, that’s because the vendor “bends over backwards to ensure that our search engine is intuitively easy so that subscribers can get results from Day One without training.”
As with all of the research products in this round-up, much of the material contained in the Parker Tax Pro Library can be found online. But having it all in one place, with analysis, practice aids, and the ability to conduct a search across different sources, is easily worth the reasonable price that Parker charges. If you save just a few hours by using the library, rather than conducting a search of free resources, the Parker Tax Pro Library has paid for itself.
If you have a complex tax practice, and will frequently need resources that the Tax Pro Library doesn’t offer, you’re probably better off spending your money elsewhere. But many sole practitioners or smaller practices will find the Parker Tax Pro Library a good investment.
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