Scheduling Tax Work At Flatiron Advisors

We have been working at making changes to how our practice operates starting in 2022. With staffing shortages, the difficulty in finding professional assistance, ever-increasing last-minute tax law changes, and simply the desire to not work 80-hour weeks from January through April, we find it necessary to implement some changes. In a nutshell, we are trying to move away from the tax-season rush and spread our work over a 9-month period instead of 8 weeks.

1. We have stopped taking on most new clients that need work done during tax season.
2. Many of you received communication from me regarding the timing of preparation of tax returns in 2022. We requested that we schedule the tax preparation work outside of tax season, with the goal of scheduling work more evenly throughout the year, rather than in a 2-to-3-month period. We received a great deal of support, and we are grateful for all that agreed to this.
3. If you did not receive the letter, we will be anticipating your tax information at about the same time that you submitted your information last year. If you want to delay the filing of your returns, let us know and we can talk through how this works.
4. If you received the letter but did not respond, we will do what we can to get your taxes prepared within 3-4 weeks of receipt, but we cannot guarantee we will be able to accommodate that a short time frame.

Why are we doing this?

The past several years have been brutal on the tax industry. Last-minute tax law changes significantly delayed filings, caused software changes that slowed us down, and forced us to take last-minute educational classes while we are supposed to be knee-deep preparing returns. The law changes and Covid also severely affected IRS operations causing backlogs of filing acceptances, and additional questions and issues for our clients.

An already compressed tax filing season has been made worse the last few years, and we see this trend continuing.

We also are shifting our business model to a model where we work with clients on a much more comprehensive basis. We find we can add significantly more value by combining year-round tax planning and, for our business owner-clients, business coaching.

My long-term goal is to work with clients on a more holistic and comprehensive basis, in an environment where there is no such thing as “tax season” forcing 80-hour workweeks, burnout and fatigue. We foresee working with clients where year-end tax results are known the year before, and where we are working year-round helping our clients minimize taxes, save more money, make better financial decisions, and increase their wealth.

What about extensions, penalties?

We frequently get the question “If I extend, doesn’t that increase the chances of an audit?”. The answer to that is an unequivocal “No”. There is no evidence this is true. The IRS and states have offered extensions for decades and it has never been shown that the risk of audit is higher if the return has been extended. Please see this brief article I wrote for more information on extensions. 

The other question we get is: “Isn’t there a fee or penalty for filing an extension?”. First, there is no “fee” that the IRS or state charges to file for an extension. And we have never charged an extension fee. There is the possibility of a late payment penalty if you owe when the return is filed. But even then, the penalties are relatively small, especially if you have been making estimated tax payments (or making higher withholdings through paychecks) and if you make an extension payment. If you are concerned about the need for an extension payment, or for estimated payments for this or next year, we can do that projection on a very broad basis for the cost of 25% of the cost of your 2020 tax return, billed when we do the work. This work must be done before December 20^th.

Here are a few articles I have written about extension payments and estimated payments:

Estimated Payments – Don’t Sweat The Small Stuff

What Are Estimated Tax Payments?

I hope you can appreciate the need for us to modify our business model. I truly believe this change will benefit all our clients and provide us the work-life balance we need to best work with our clients and provide the best service possible. Please reach out to me if you have any questions or concerns.