Ask the Expert: The rise of contactless tax services

Featuring John Sapp, CPA and Chief Revenue Officer Drake Software LLC

Q What do you expect the future of contactless tax prep to look like?

A While many businesses embraced contactless services out of necessity at the height of the pandemic, I expect this shift will become permanent for the tax industry. Both taxpayers and tax preparers enjoy the convenience of remote delivery and working from anywhere. A recent Drake Software survey of more than 2,300 tax professionals found that 31% serve clients who prefer completely virtual tax-preparation services, and 37% plan to strongly encourage contactless engagements.

Q Do you think this trend is good for the tax industry?

A Contactless services are more than a trend: They are the new standard for doing business. Eighty-six percent of those we surveyed believe they can offer the same level of service for contactless clients as for the traditional client. One of the greatest challenges of the future for tax preparers is to establish and maintain client trust that they have traditionally built through in-person meetings. They must instead find and embrace new methods of service delivery through technology that establish a personal relationship with their customers, despite there being no physical handshake or in-person contact. The tax preparers who can effectively build personal relationships using current and upcoming technology will find increased opportunity for growth.

Q Is contactless a secure way to do business?

A In a word, yes. Platforms that support contactless tax preparation — like client-facing portals for exchanging documents — generally include safeguards such as multifactor authentication, data encryption, and regular data backups. When you also consider the security requirements for tax professionals under the FTC Safeguards Rule, our industry is well equipped to keep business and customer data secure while tackling the challenges of contactless tax preparation.

Q Are there advantages to offering contactless services?

A Offering contactless services means you can take your tax practice nationwide. As long as your preparation software provides accurate support for the necessary state and local tax forms, you can grow your practice far beyond the boundaries of driving distance. Even local clients who are sensitive to challenges such as the cost of gas, difficult work schedules, or compromised immune systems will be glad to work with your company from the comfort and convenience of their own home or place of business. You may even find you no longer need a large storefront to serve clients, instead housing your data in the cloud and your employees in remote locations. This could save you a great deal of business overhead, allowing you to invest in new technology, additional staff members, or that vacation you’ve been dreaming about!

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Drake Software, founded in 1977, provides software solutions to over 70,000 tax and accounting firms that file more than 36 million tax returns every year. Known for award-winning customer service, Drake is also consistently recognized for excellence in quality, value, reliability, and product innovation.

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