Tax Season Review

The 2021 tax season is officially behind us!  Each year, by the end of May we are able to breathe a sigh of relief that tax season is complete.  Did you know over the past few years there have been some really unusual factors that have made tax preparation and planning more challenging than ever? 

Here’s just a few:  

• During 2020 and 2021: PPP Business loans and Stimulus Checks to Individuals
• 2020 Tax filing season: Deadline to file was moved later to June 15th
• 2021: Families received Advanced Child Tax Credits

After tax season our team at FDS sits down to discuss how it went and things we notice that are important to change for next year.  We track a lot of information so we can ensure we are getting tax returns completed efficiently for you.  Some items we keep track of are; the date we first receive documents, the length of time to receive answers back from you, along with the filing date.

Tax Season Data

During our team meeting we decided that sharing some of this information would be helpful to you.  This data actually isn’t unique to our firm.  It’s being seen in the whole industry, we just happen to be tracking it for ourselves. Unfortunately, it’s even driving many accounting professionals out of the field to early retirement.  

Something we have noticed over the past few years is people are sending tax documents later and later.  This could be due to other factors:

• Financial Institutions taking longer to send tax documents
• People’s work and personal lives affected by economic changes

The chart below shows this best as you can see when we first received data from clients each year.  It has noticeably moved later and later.  Why does this matter?  Accountants have a capacity of how many returns they can complete per day or week.  If too many people send information later, you risk your return not getting filed by the deadline.     

Something you’ve probably noticed, too, is that people are moving geographically.  Whether the move is related to retirement or family circumstances this affects the amount of knowledge you need as each state is different.  Here you can see how the number of states Steve files tax returns for has increased in just the last three years.

Talk about a lot to keep track of!  Given the very unusual tax changes we’ve seen in such a short period of time we wanted to highlight Steve’s great work to keep up with all these changes. Steve cares about accuracy and timeliness amid all of the changes thrown his way.  And these didn’t just affect tax filing, but also year-end tax planning each year.  If you work with him to prepare your tax return you already know that he does a great job!  Thank you for your diligent work, Steve!