june2022 - 9

FEATURE
2022 TAX SEASON REVIEW:
The Good, The Bad, & The Ugly
THE 2022 TAX season, stretching from January 24 until April
18, 2022, was a busy one for CPA firms. Around 46,000 CPA
firms worked around the clock to file their clients' tax returns
on time. This period presents a lot of stress and challenges
for CPA firms as well as opportunities to improve their overall
operations and productivity for the next year.
THE UGLY
For the 2022 tax season, taxpayers
should be expecting delays in processing
their tax returns. The Internal
Revenue Service (IRS) continues to
have operational problems due to the
pandemic, budget cuts, distributing
federal economic relief payments,
heightened workload, and dealing
with a 2021 backlog of tax filings (and
even older!). Many taxpayers can opt
for an extension that enables them to
file until October 15, 2022, which may
help with the IRS backlog.
The IRS backlog is a definite
headache for many CPA firms. They
have expressed much frustration
with the chaos at the IRS and have
expressed that they felt powerless to
help clients. While they can file tax
returns electronically, they need to
ensure the tax returns are accurate
to help speed up refunds. The IRS is
increasing its enforcement efforts,
so businesses need to have better
recordkeeping compliance. With many
CPA firms embracing a more remote
workforce following the pandemic,
using a secure cloud-based platform
is key to ensuring their clients' tax
information is safe and accurate so
their tax returns are not held up or
audited by the IRS.
THE BAD
While the 2022 tax season has been a
bit chaotic due to the IRS issues, CPA
firms faced their own challenges.
Many CPA firms had to navigate these
challenges throughout the 2022 tax
season and get their clients' taxes
filed on time.
* Hiring & Retention Crisis. Remote work
may be here to stay, so CPA firms need
to adapt their operations to cater to the
new workforce demands. Recruiting,
hiring, and retaining accounting and
tax professional talent involves fierce
competition with other CPA firms.
Their services are at a premium. If
your CPA firm offers teleworking,
remote, and hybrid work situations,
then promote this benefit to potential
and current employees. If the workfrom-home
arrangement is secure,
easy, and successful, then CPA firms
will likely have more success hiring
and retaining their star employees if
they offer a flexible work environment.
* Ongoing pandemic and operations
logistics. As CPA firms continue to deal
with COVID-19 implications from 2020,
employees continue to work remotely,
either temporarily or permanently,
as well as in hybrid situations. With
many employees working from home,
CPA firms still need to deal with data
security and plan for the next disaster.
Now, the hybrid work environment
presents a new frontier as CPA firm
employees navigate both working from
home and from the office during the
week. For instance, CPA firms have to
establish work policies and programs
that deal with both formats.
* Remote Capabilities. Employees working
remotely will need to be set up with
fast, reliable internet and secure access
to the CPA firm's documents. Workers
must have easy access to relevant
files so they can continue working
without interruption or having to take
a trip to the office to grab a paper file.
Embracing cloud-based technologies is
one effective way CPA firms can enable
their employees to work remotely. The
clients' data is secured and employees
can access the files smoothly and
without difficulty since everything
is integrated in their work accounts.
* Application & Bandwidth Issues. If CPA
firms have application and bandwidth
issues during tax season, it can cause
an absolute nightmare. Applications
and internet bandwidth have hiccups
and possibly even crash when their
capacities reach their maximum.
Servers can get overloaded with too
much data. Data overload can also
negatively affect the bandwidth of the
internet service. By enlisting the help
of a third-party IT provider, many CPA
firms can avoid these maladies during
tax season because the vendor takes
care of the issues for you. No more
application and bandwidth hiccups!
* Rising Cybersecurity Threats. The
tax season always presents a rise in
cybersecurity threats, especially for
CPA firms due to the nature of their
work. They handle very sensitive
tax and financial data for millions of
individual and business taxpayers.
According to data (https://tinyurl.
com/mvxk6977), CPA firms have dealt
with an 80% increase in reported
data breaches since 2014. These
By Christopher Stark
cybersecurity issues can cost millions
of dollars in damages and recovery.
The top three cybersecurity issues
include phishing scams, accidental and
malicious insiders, and ransomware.
Having a reliable and technology-savvy
cloud-based platform can help CPA
firms avoid the worst of the rising
cybersecurity threats.
THE GOOD
Despite the tax season being a stressful-yet
very lucrative-time for CPA
firms, it always presents opportunities
to review current software, organize
files, upgrade staff, improve communications,
and help tax preparers avoid
burnout. With cybersecurity threats
on the rise, CPA firms can be proactive
and review their firm's cybersecurity
practices and implement security
trainings for employees to better avoid
cyber threats. Additionally, CPA firms
can decrease their overhead costs by
moving to a cloud-based platform
and retiring those expensive servers
as well as reducing the number of IT
professionals on the payroll.
The tax season is often measured
by the revenues a CPA firm generates,
so this time period is make-or-break
for the whole year. Adopting a reliable,
secure cloud-based platform
designed especially for CPA firms will
help reduce stress for tax preparers
because they can access the necessary
files at any time as well as have
assistance should an application crash
or a cybersecurity problem arise.
Consider the possibilities of
upgrading to a cloud-based solution
to meet your needs and close the gaps
in your cybersecurity. ■
Christopher Stark is president and
CEO of Cetrom.
JUNE 2022 ■ www.CPAPracticeAdvisor.com
9
https://tinyurl.com/mvxk6977 https://tinyurl.com/mvxk6977 http://www.CPAPracticeAdvisor.com
june2022

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