Rick Telberg
Rick Telberg

How to Turn ‘Busy’ Into ‘Opportunity’

Savvy CPA tips for getting the most out of tax season 2009.

February 2, 2009
by Rick Telberg/At Large

Tax practitioners are digging into what may be one of the busiest busy seasons in memory. A tanking economy, investor losses, a new government and bailout and stimulus packages are combining to create a fast-changing landscape.

But if it’s “busy season,” then it’s also “opportunity season.” This is the time when clients and companies most rely on CPAs. And it’s a time for CPAs to have the most impact on the lives of their clients on their own careers and practices.

“There is no question that the CPA is still the most trusted advisor, short of any local religious leader that a client may have,” says Mark W. McGorry, managing director at Wealth Partners LLC.

Richard L. Engebretson, vice president at WealthStar Alliance, a service of Aviva USA, suggests CPAs are overlooking huge opportunities if they’re not helping clients with retirement planning.

“CPAs should be conducting “retirement audits” for all of their PFP clients near and in retirement to insure the clients’ assets will have the propensity to generate the necessary income to substantially sustain their lifestyle and needs during their life expectancy.”

Another question CPAs should be asking is: “How much risk can your clients handle?” In a bear market, CPAs need to know. And then they need to help clients fine-tune the risk, according to Bert Schweizer III, CPA, PFS.

“CPAs should focus on helping clients control what can be controlled, and understand that neither they nor their clients can control the markets,” says Schweizer, a principal and founder of Buckingham Asset Management, LLC, a Registered Investment Advisor firm in St. Louis. He is also a principal and founder of BAM Advisor Services, LLC, a comprehensive service-provider for registered investment-advisor firms across the country.

Schweizer says CPAs can help their clients:

  • remain disciplined and maintain globally-diversified equity portfolios combined with short-term high-quality bonds,
  • transfer assets for estate tax-planning purposes while asset values are lower,
  • consider terminating high-cost variable annuities and
  • help their clients keep a long-term view and make sure their clients properly assess their need, ability and willingness to take risk.

This busy season, savvy CPAs will be focusing on delivering more “face time” and spending less “screen time.” Accountants too often fall into the trap of relying too heavily on their tax preparation software, according to Mike Solomon, at Amper, Politziner & Mattia.

“They look at the input screen and think it will prompt them for questions to ask, and they’ll get their clients all the deductions and credits available,” Solomon told a reporter. “That’s not always the case.”

“For example, if you don’t have a child’s date of birth in the tax software it won’t necessarily tell you that the Kiddie Tax may apply, since up to 2006 it only applied to children 14 and under,” he says. “There are so many interrelationships, that you need to understand how the rules operate and not just rely on the software.”

Michael David Schulman, CPA, PFS, and third-generation owner of a CPA firm bearing his name in Central Valley, N.Y., and New York City, says CPAs need to protect clients from themselves, for example:

  • liquidating their portfolios,
  • making withdrawals from qualified accounts resulting in income taxes and possible withdrawal penalties or
  • not paying life-insurance premiums resulting in cancellation of policies that might be difficult to replace.

“CPAs,” he says, “should work with their clients to prevent the clients from making quick and irrational decisions that will have unfavorable consequences.”

NOW IT’S YOUR TURN: What do clients need most this busy season? E-mail me here.

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Copyright © 2009 CPA Trendlines/BSG LLC. All Rights Reserved. Used by Permission. First published by the AICPA.

About Rick Telberg

Rick Telberg is editor at large/director of online content.

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Disclaimer: Any views expressed in this article do not necessarily reflect the views of the AICPA or CPA2Biz. Official AICPA positions are determined through certain specific committee procedures, due process and deliberation.