Neil Fishman, the returning president of the National Conference of CPA Practitioners, shares vital insights as tax season approaches. He discusses the hurdles tax professionals face, including delays from brokerage houses and the complexities of upcoming tax laws. The conversation dives into the IRS’s challenges, like a hiring freeze and system upgrades, as well as ongoing legislative uncertainties regarding the SALT deduction cap. Fishman emphasizes the importance of credentialing for tax preparers and encourages new talent to explore diverse accounting careers.
The upcoming tax season is expected to be particularly difficult due to delays in obtaining necessary documentation from brokerage houses.
The expiration of provisions from the Tax Cuts and Jobs Act could lead to tax reforms that lack bipartisan support, creating uncertainty for taxpayers and preparers.
Deep dives
Expectations for the Tax Season
This tax season is anticipated to be challenging, possibly even more so than in previous years. Delays in receiving necessary information from brokerage houses are expected to be a significant issue, with many clients needing to wait longer than usual for their documentation. There have been repeated instances where clients bring in documentation only to find it incomplete due to delays in processing. The added pressure from the aging workforce of tax preparers, who may take longer to complete tasks, only heightens these concerns.
Concerns About Legislative Changes
The looming expiration of various provisions from the Tax Cuts and Jobs Act raises uncertainties for upcoming tax legislation. If Congress does not take action, tax brackets and other deductions could revert to previous, less favorable conditions, creating anxiety for both taxpayers and preparers. There is consensus that issues like the SALT cap should be addressed, especially affecting high-tax states, which could lead to potential adjustments in the future. However, the current political landscape may limit the scope of reforms that can garner bipartisan support.
IRS Staffing and Performance Challenges
A hiring freeze at the IRS threatens to impact its ability to support tax preparers and address taxpayer needs effectively during the busy season. With experienced staff nearing retirement, the potential loss of accumulated knowledge poses significant risks for operational efficiency. Although there were improvements in IRS responsiveness following increased funding, current calls from Congress may reverse these benefits. As operational challenges persist, both practitioners and taxpayers are likely to experience longer wait times for assistance.
Neil Fishman, returning president of the National Conference of CPA Practitioners, shares the issues his members are paying attention to as they head into tax season -- and what they're keeping an eye on for the rest of the year, too.
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