Over the past week or so, it was announced that H&R
Block is closing hundreds of locations as it prepares to file fewer tax returns
this coming year following the passage of the Tax Cuts and Job Act. Now I’m
sure you can imagine that I don’t often like speaking about the big tax return
factories, and I won’t be able to completely hold my virtual tongue here as I
discuss them, but I have to do so as I
find this to be interesting news.
First off, this is not completely surprising. The thinking
is that more people will have less complicated tax returns because of the
increased standard deduction. And yes, there are going to be more people who no
longer will itemize their deductions, and their tax returns will become that
much simpler. I believe, however, that if clients receive a higher level of
service, they will not simply abandon their tax preparer.
If you feel your preparer is only putting the right things
on the right lines of a tax return, then I can see why going it at it by
yourself makes sense if you are anticipating having fewer lines to put numbers
on. I, however, aim to give my tax clients more than this.
One of the best parts of tax season is making people aware
of things we can use in their tax return that they were not even aware of. For
it is one thing to be the person who can make sure you put all the right
numbers on all the right lines, but it is much more gratifying to add in new
numbers on new lines that can lead to a bigger refund. And this is a dynamic that is not going to go
away with a new set of tax rules.
I believe that my clients should leave with the confidence
that they are filing a tax return that utilized the tax rules to their greatest possible advantage. For really, if someone misses
something on a tax return it’s usually not unreported income, but deductions
that are not being used (at least if it’s all done ethically and legally).
These things are missed because tax law is complicated. It was complicated
before, and it is still complicated now.
So even though many tax returns will become simpler under
the new rules, don’t you still want to file a return that reflects the best
possible situation for you? Even if you only end up taking the standard
deduction and there is little else needed to report on your return, is there
not comfort in knowing that was your best possible choice?
I mean, we are months after the passage of the TCJA, and the
IRS is still releasing notices advising on how many of the rules will be
applied. If they are taking this long to figure things out, can it really be
that simple?
And sure, my view on this is far from unbiased. I trust,
however, that the level of service I provide to my clients will lead them to
agree, and we will remain committed to getting through the new law together.
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