The following is some of the advice I give when I train or mentor a new tax specialist:
- To build awareness of what they need to know, they need to peruse every journal or tax service they subscribe to. (If you are not going to go through it, then don’t subscribe — osmosis doesn’t work in this situation.) This means looking at every page of every issue to see the topics written about and when they come across something they are working on or that might affect a client, they should read it. They also need to retain what they are looking at so if something similar comes up, they could recall seeing that matter being written about and possibly when. At a minimum they need to look at their society journals, should belong to the AICPA tax section and get the Tax Adviser and tax checklists, daily tax updates, some e-newsletters and some other publications that I usually recommend.
- Don’t forget what you worked on. The really good tax people never forget what they worked on, either directly or through formal or informal discussions or consultations with colleagues and clients. The exact details don’t need to be remembered but the issues need to be.
- Look everything up. Don’t trust your memory and, anyway, taxes change daily, particularly many of the complicated issues we usually work on.
- Know where to look. Always go to original sources when doing research. Summaries, headnotes, articles, books, firm internal memos and previous research papers and seminar and conference handbooks are good places to start or to get a first look. But you must go to the Code, regulations, revenue and private rulings, court decisions, and everything and anything else that is the original source of the commentary.
- Check the internet and know what’s available. I find almost all the research is being done online. I used to have two librarians come to my office every other week to file the tax service updates. Now, my office does not have any book cases.
- The tax form instructions are excellent sources of information about a return. Use them regularly.
- Use prior tax returns done for the client as a guide to the current year or matter, and to establish a database about the client. No matter what the current issue is, you should have a handle on their income and tax situation — the prior returns provide that.
- When working on a type of tax return for the first time, find out if there were any other clients this return was done for, and use that as a guide.
- Know who the experts are. Know the go-to people in your firm who are experts in particular areas, or who to go to outside your firm. Not knowing who to go to within your firm is a sin. Make use of outside people you meet through attending conferences and networking, and read their published material. Become familiar with everyone you work with, or should be working with.
- Know the methods for contacting the IRS National Office on issues that your research cannot produce conclusive answers to or where the issue is vague.
- Use checklists to follow procedural paths and every checklist the firm requires. To maintain the integrity of the firm’s system, the checklists must be used in every instance, with no shortcuts. If they are not, try to have the firm change the system, but until then, they must be used.
- Do not accept work from subordinates who did not follow procedures or use the checklists the proper way.
- If you are a new reviewer, use the AICPA Tax Section (or PPC) Long Form checklists as a guide to what you should be looking at and thinking about until you develop your own methods and momentum.
- Use your judgment and focus on adding value to the client.
- Be responsive to clients and colleagues. Tax specialists are supportive to those working directly with clients. A low-level staff person could have a request for research that the firm’s largest client asked her about. Also, not responding to staff lessens your value to the firm and will have those staff people look elsewhere for what they need to know. A basic rule is to respond in a timely way to every request, email, text and phone call. If you cannot provide an immediate answer, give a date and time when you will, but respond quickly. If you are too overloaded, then speak to your superior to help you organize your schedule. You are never alone in the firm.
The above are some of my tips and “free advice.” Use what you want, but I believe these are all good steps to adopt.
Edward Mendlowitz, CPA, is partner at WithumSmith+Brown, PC, CPAs. He is on the Accounting Today Top 100 Influential People List. He is the author of 24 books, including “How to Review Tax Returns,” co-written with Andrew D. Mendlowitz, and “Managing Your Tax Season, Third Edition.” Ed also writes a twice-a-week blog addressing issues that clients have at www.partners-network.com. Ed is an adjunct professor in the MBA program at Fairleigh Dickinson University teaching end user applications of financial statements.Art of Accounting is a continuing series where Ed shares autobiographical experiences with tips that he hopes can be adopted by his colleagues. Ed welcomes practice management questions and can be reached at (732) 964-9329 or firstname.lastname@example.org.