Step-by-Step Guide to Launching Profitable Tax Resolution Services

As tax season draws near, many accountants brace for the influx of clients seeking help with not just filing taxes but also resolving more complex tax-related issues.

This is where tax resolution services come into play, a distinct challenge beyond straightforward return preparation.

Tax resolution encompasses a wide array of services specifically aimed at solving tax problems rather than simply reporting financial data on tax forms.

While tax preparation involves calculating and documenting past incomes, deductions, and credits to comply with tax laws, tax resolution is about addressing and rectifying outstanding tax issues. This could include negotiating payment plans or settlements for unpaid back taxes, representing clients in front of the IRS during audits, or helping to lift liens and levies.

The difference is crucial: tax preparation is reactive, ensuring compliance with laws for a given year; tax resolution is proactive, seeking to mitigate past issues and disputes with tax authorities.

As we near another tax season, expanding your accounting firm’s offerings to include tax resolution services could not only meet a growing demand among those facing such challenges but also significantly enhance your firm’s capabilities.

Embracing tax resolution services positions accountants as essential advisors, capable of navigating both routine and complex tax landscapes.

This pivotal role helps retain current clients and attract new ones who require more than just tax preparation—those who need a strategic advocate to guide them through the maze of tax compliance and controversy.

In this article, I'll guide you through the basics of tax resolution, especially how to manage clients with both small and large debts, and I’ll share actionable steps you can start taking today to offer this valuable service.

And if you're eager to delve deeper into how you can adapt your practice to these demands, consider listening to my podcast, "Mastering the Numbers Game: Innovative Strategies for Transforming Your Firm w/ Eric Green." The podcast explores further strategies that empower accountants to leverage their expertise during this hectic season, ensuring they can provide exceptional value and guidance to their clients.

Managing Clients with Smaller vs. Larger Debts

Managing clients with varying levels of tax debts requires a tailored approach that takes into account the complexity and size of each debt.

For Clients with Smaller Debts

Clients with smaller tax debts typically face less complex issues, which allows for more straightforward resolution strategies:

• Installment Agreements: Help clients set up manageable payment plans with the IRS. This involves calculating what they can reasonably pay monthly and negotiating this plan with tax authorities.
• Penalty Abatement: For clients who have failed to pay on time due to reasonable cause, request penalty relief. Document the client’s reasons meticulously to increase the likelihood of success.
• Streamlined Processing: These cases often don't require extensive documentation, so they can be processed more quickly, allowing you to help more clients efficiently.

→ Actionable Tip: Create a checklist for handling smaller debts that includes gathering client information, assessing financial statements, and preparing proposal documents for negotiations. This will standardize the process and save time.

For Clients with Larger Debts

Clients with larger tax debts encounter more complex financial and legal challenges, necessitating a detailed and strategic approach:

• In-Depth Assessment: Conduct a thorough review of the client’s financial history and current tax issues. Understand the roots of their tax problems to better address them.
• Negotiation Strategy: Develop a negotiation strategy based on a deep understanding of tax law. This might involve proposing an offer in compromise where debts are settled for less than the amount owed if the client meets certain conditions.
• Legal Preparation: In cases involving liens or levies, prepare to engage in more extensive legal processes. Having a tax attorney on call or collaborating with legal experts can provide your clients with a comprehensive defense strategy.

→ Actionable Tip: For larger debts, maintain a detailed log of all communications with tax authorities and ensure that all agreements are documented. Regularly update your client about the status of their case to keep them informed and engaged in the resolution process.

Actionable Steps for Accountants to Excel in Tax Resolution Services

Stepping into tax resolution services might seem daunting at first, but think of it as an essential expansion of your practice that meets a growing demand. Just like when you first started out in accounting, there’s a learning curve, but with the right steps, you’ll become a go-to expert for clients in distress.

Here’s a simple roadmap to get you started:

1- Education and Certification

Imagine you're dealing with a client who's facing serious penalties from the IRS. You’ll want to confidently navigate them through these choppy waters. Getting certified as a Certified Tax Resolution Specialist (CTRS) not only arms you with the necessary knowledge but also shows your clients you have the expertise to handle their complex issues.

→ If you're ready to expand your accounting services to include tax resolution, consider enrolling in Universal Accounting's Enrolled Agent program. This specialized training equips you with the necessary skills to effectively handle tax resolution cases, offering your clients invaluable support with their tax issues. By becoming an Enrolled Agent, you can confidently navigate the complexities of tax laws and disputes, providing a critical service that can significantly benefit your clients and enhance your practice.

2- Marketing Your Services

Remember how you landed your first big client? Through effective marketing. Now, as you add tax resolution services, it’s time to update your marketing strategies. Highlight your new services on your website, share success stories on social media, and perhaps run a local workshop on the benefits of tax resolution services.

3- Invest in the Right Tools

Think back to when you first integrated accounting software into your practice. The efficiency it brought was a game-changer, right? It’s similar with tax resolution. Using specialized software can simplify the complex processes of tax resolution, making your work more efficient and effective.

4- Stay Updated

Tax laws aren’t static; they're always changing. Just like you keep up with annual tax updates, make it a point to stay informed about the latest developments in tax resolution. Subscribe to relevant newsletters, join workshops, and engage with community forums.

5- Build a Network

When you faced that complicated audit issue last year, having a network of professionals to consult with was invaluable. Similarly, for tax resolution, build relationships with tax attorneys and other specialists who can provide advice or refer clients when cases go beyond your expertise.

Taking these steps not only positions you as a vital resource in navigating tax issues but also sets your firm up for success in a competitive field. Start with these actions today to build your expertise and reassure your clients that you’re equipped to handle their most pressing tax challenges.

Venturing into tax resolution services isn't just about adding another item to your service menu—it's about becoming a crucial lifeline for clients navigating the stressful waters of tax disputes.

Have you considered how your expertise could turn someone's financial crisis into a manageable situation?

Or how could deepening your knowledge in this specialized field transform your role from basic compliance to critical strategic advice?

By diving into tax resolution, you commit to an ongoing journey of education and skill enhancement. This commitment doesn't just improve your service quality; it elevates your entire practice.

Clients don't just need someone to file their returns; they need a trusted advisor who can guide them through complex tax issues and save them from potential financial ruin.

Adopting these services means that you can offer comprehensive solutions, ensuring that your clients receive expert advice on their current issues and also proactive strategies to avoid future problems.

Isn't that the kind of indispensable advisor you aim to be?

Embrace this path and position yourself as a leading figure in the accounting sector, where your expertise in tax resolution enhances client trust and satisfaction.

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To discover how you can apply these principles to start and grow your accounting, bookkeeping, and tax business, visit us at Universal Accounting School or call us at 435-344-2060 for personalized advice and training options.

About Roger Knecht

Roger Knecht is president of Universal Accounting Center, a post-secondary school for accounting professionals. With over 20 years of marketing, sales, HR & operations experience, Roger Knecht has helped thousands of business owners work ON their businesses to increase revenue, improve profits and build value. His strong work ethic and collaborative style delivers reliable, high-quality results for business owners.

Roger’s podcast, Building the Premier Accounting Firm, keeps accounting professionals on the cutting edge of the industry offering quality bookkeeping, accounting, and tax services. He hosts discussions with some of the accounting world’s best minds and shares actionable insights for firms.

Roger is the author of “Your Strategic Accountant” and “Your Profit & Growth Expert”, each written to help business owners understand what they can expect from the accounting profession.

Universal Accounting provides accounting professionals with the training, certifications, coaching, and support they need to become Profit and Growth Experts for their clients.