Every day, we encounter new use cases for AI as competing language models emerge, showcasing exciting ways AI can simplify our lives. The accounting and tax industry is no exception, with tax planning gaining significant attention from firm owners for its potential to boost revenue. What if you could use AI for tax planning?
That’s exactly what we’ll explore in this blog.
Tax professionals assist clients by preparing and filing their taxes on time to ensure compliance. However, when the focus shifts from mere compliance to cost-saving—by optimizing yearly financial affairs to minimize tax liability—that’s where tax planning comes in.
While tax preparation is a necessity for clients, tax planning is what they truly desire. In fact, you might already be offering tax planning services without even realizing it.
If a client reaches out for advice on how to reduce their tax burden, you’re already providing tax planning. By creating pricing packages that highlight this advisory aspect, you can effectively charge for the valuable planning services you offer!
At Credfino, we offer access to skilled offshore tax preparers, but our services go beyond that. Schedule a call to know how we can help
When it comes to Tax Planning vs. Tax Preparation, the difference is significant.
Tax preparation is primarily a retrospective process. It involves reviewing past financial activities and reporting what has already happened—essentially, this is what most tax preparers do as part of their job description.
On the other hand, tax planning takes a proactive approach. It’s about looking ahead to the future and assessing the current financial landscape to implement strategies that minimize your tax liability.
Clients are tired of seeing a large chunk of their income go to taxes. And when you make your clients see the potential cost saving that they can have with tax planning, they’ll happily take it the complementary service.
Tax planning is not just about compliance; it’s about optimizing the financial situation to keep more of hard-earned money. Clients don’t just want their taxes filed; they want strategies to legally minimize what they pay to the government.
Unfortunately, many accounting firms are set up primarily for tax preparation. By the end of tax season, they’re often too burnt out to focus on planning. However, this is where the real value lies—helping clients save money and achieve their financial goals
ChatGPT is a language model that contains data up until 2021, and while newer models can perform critical thinking and complex calculations, some still have limitations. So, does that make ChatGPT suitable for tax planning?
While it can generate decent outputs, the information provided by such language models isn’t always reliable.
Limitations of ChatGPT in Tax Planning:
A. Introducing TruePrep AI
TruePrep AI is an advanced tool crafted specifically for tax professionals, designed to streamline tax preparation and boost efficiency in managing client data. One of the standout features of TruePrep AI is that it has all the IRS data integrated into its system.
Unlike general language models, which can pull information from various sources (sometimes leading to inaccuracies), TruePrep AI relies on data directly from the IRS—considered the ultimate authority on tax filing. This ensures that the output is not just reliable but also aligned with the most current tax regulations.
Here’s what sets it apart:
I’ve been experimenting with TruePrep AI, and I invite you to check it out in the YouTube video below.
So, let’s dive into the details:
Features of TruePrep AI
Use Case
One feature I particularly loved is its ability to fetch client data instantly with just a simple prompt. This makes it incredibly easy to identify who’s affected by the latest tax regulations.
The benefits include:
Additionally, it’s super helpful for research work as well.
At Credfino, we assist tax firm owners tackling the challenges of workload influx during tax season with tailored capacity management plans—and so much more!
Curious about how we can transform your tax season into a seamless experience? Schedule a call with us!
Tax planning is all about delivering MORE VALUE.
This translates to:
→ Higher fees
→ Year-round client attention
→ Stronger relationships
However, with so many tax planning software options available, how do you choose the right one?
To help with this, I’ve selected a mix of the most widely used tools along with those gaining popularity for comparison.
Holistiplan offers automated tax return analysis and tax-saving strategies to enhance client engagement. With its focus on delivering comprehensive tax-saving reports, this tool helps accountants provide valuable insights to their clients. Priced starting at $999 per year, Holistiplan supports PDF-based tax return uploads and complies with SOC 2 security standards, ensuring data protection. This software is ideal for accountants looking to elevate their tax planning services while maximizing their clients’ savings through detailed analysis.
The BNA Income Tax Planner provides comprehensive tax liability calculations, including federal and state support, making it suitable for handling complex returns and multi-year forecasts. Although pricing details are not available, this tool supports manual input and the importation of tax data for streamlined operations. With a focus on regulatory compliance and data security, BNA ensures that accountants can effectively manage their clients’ tax obligations while maintaining accurate records throughout the tax year.
Tax Planner Pro integrates seamlessly with QuickBooks, allowing for real-time tax projections and quarterly tax payment optimization. Priced at $1,299 per year, it provides accountants with the tools needed to enhance their clients’ tax strategies effectively. The software supports QuickBooks data integration, simplifying data management for accountants. With basic encryption and data protection measures in place, Tax Planner Pro offers a reliable solution for accountants seeking to optimize their clients’ tax positions while maintaining security.
Corvee Tax Planning offers customizable tax plans and proactive tax strategies designed to meet client-specific needs. While pricing details are not available, this tool enables accountants to track tax strategies effectively and address client-focused planning. It supports automated data entry from tax returns and adheres to SOC 2 security standards, ensuring data privacy. Corvee empowers accountants to deliver tailored tax solutions, helping clients navigate complex tax environments while optimizing their financial outcomes.
Lacerte Tax Planner facilitates tax liability projections and offers comprehensive federal and state tax planning, including multi-year scenarios. Part of the Lacerte Unlimited package, which costs $324, this tool allows accountants to support previous year tax data efficiently. Lacerte adheres to industry-standard encryption, ensuring the protection of sensitive client information. By providing robust planning capabilities, Lacerte enables accountants to guide clients effectively through their tax obligations while enhancing accuracy and compliance.
TruePrep AI harnesses artificial intelligence to automate tax research and data analysis, simplifying the tax preparation process for accountants. With a pricing structure starting at $50 per month, this tool provides a web app-based interface for tax data removal techniques. TruePrep AI ensures compliance with SOC 2 security standards, offering peace of mind regarding data privacy. By leveraging advanced technology, TruePrep helps accountants improve efficiency while delivering high-quality tax services to their clients.
It wouldn’t be accurate to say that AI or any specific tax planning tool can handle tax planning entirely on its own. However, they can be incredibly helpful.
Tools like TruePrep AI can fetch client data securely, while platforms like Corvee offer over 1,500 tax strategies. If you have a solid client base for tax preparation services, you can easily upsell them on tax planning and advisory services—this is where the real value lies.
If you’ve been hesitant about taking on tax planning, these amazing tools can help you lay the groundwork.
At Credfino, we provide access to skilled offshore tax preparers, but our services extend far beyond that.
We help tax firm owners transition from billable hours to more effective pricing models and shift their focus from preparation to planning.
Additionally, we tackle the challenges of workload influx during tax season with customized capacity management plans—and so much more!
Ready to move ahead and want a partner you can count on? Schedule a call!
Jackie launched her CPA firm back in 2012. After 11 years of running her firm, she finally made the leap to partner with an offshore CPA back office. Why?
If your offshore tax accountant is doing these 7 things, it’s time for a break-up because you are not in a healthy offshore accounting partnership.
Offshore tax prep seems like a logical solution to fill the gaps, but what does it really look like in practice?