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3 ways you could make more money because of the Tax Cuts and Jobs Act

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The Tax Cut and Jobs Act (TCJA) made some fundamental changes to the tax code and was dropped on all of our laps in December 2018, just as tax season kicked off. While you may have not taken the time to fully digest it during tax season, this is the time to fully understand the TCJA because it will have a significant impact on your clients’ taxes for 2018. However, have you thought about how to use your understanding of the law to bring in new revenue? Here are three ways you can do that.

#1: Offer Proactive Advisory Tax Planning

The TCJA will have significant changes to how your individual and business clients are taxed in 2018. Whether it is the qualified business income deduction or changes to itemized deductions, there are a lot of changes that need to be considered for tax year 2018. Your clients might have started to ask those questions during this past tax season, so now is the time to be proactive and do some tax planning. This proactive tax advisory work will show your clients you are looking out for them and helping them prepare for tax season, but it’s also a great way to bring in new revenue. By offering tax planning in addition to your tax preparation work, this will allow you to have a year-round income stream.

Using the Tax Planner feature in Intuit® ProConnect™ Tax Online will also. To show your individual clients potential outcomes for their 2018 federal taxes under the new law, the Tax Planner allows you to take their information from tax year 2017 and run different tax planning scenarios for 2018 and beyond. With this knowledge, you can make recommendations on how to take advantage of tax law changes and help them prepare if they need to make tax estimates. This new feature also gives you the ability to make changes throughout the year as your clients’ situations change and will help avoid any surprise tax bills when the return is filed.

#2: Source New Clients

Since there were so many changes to the TCJA, many taxpayers who previously prepared returns on their own will now want to work with a tax professional. Taxpayers may be nervous about how the new tax law will impact them or if it will benefit them. Now is the time to make your expertise known by creating a sales and marketing plan to reach new clients. This can be done by writing blog posts or tax guides for your website for prospective clients. You can also host webinars or seminars that go into depth on the new tax law. By making your expertise known, you can attract new clients for this next tax season.

#3: Change Your Pricing

With all of the work needed to understand and comply with the new tax law, this might be a good time to revisit how you price your tax returns. Pricing the same as you did last year won’t capture the added value and effort that you will be providing this year. If you normally bill by the hour, this might be a good year to try value pricing, where you can offer a higher price that will compensate you for your work in understanding the new tax law.

You may want to also provide different options for your services. For example, you can use a three-tier pricing model with a price on the low end that only includes processing the tax return, a price in the middle tier for the tax return and a tax planning session, and a third tier with the tax return, tax planning session, and unlimited call and email support through the year. By giving them additional options, you can create new service lines and ways to serve your clients throughout the year.

What’s in it for You?

The TCJA can be a way to provide additional services, gain new clients, price in a new way and ultimately bring in new revenue to your firm. This is not a year to have the “same as last year” mentality because that thinking will leave potential revenue on the table or may lead to your clients looking elsewhere for the tax help they need. Take the time to learn all that you can about the new law so that you can provide the value your clients and prospects need.

3 responses to “3 ways you could make more money because of the Tax Cuts and Jobs Act”

  1. Since the IRS hasn’t issued any regs yet, how are we supposed to advise our client’s on the QBI deduction, when we don’t even know if they qualify?

    • Great question– you are right that the regs are not out yet, but we do know what the law says and where the gaps are that need guidance from the IRS. Right now would be a good time to provide that information to your clients or prospective clients so they are prepared with the knowledge of where we stand and then when the guidance does get issued to follow back up with them and provide advice based on their situation.

      • Yes, that’s a very good question, and you are not alone–many practitioners are asking the same question. We are hearing that the IRS will be issuing guidance on the new qualified business income deduction in the coming weeks. There is a mixture of knowns and unknowns, so do your best to advise your clients on what you know at this point, then revisit the scenarios once we get clarification from the government. Here are some helpful materials to review: Policy highlights; Joint Explanatory Statement; legislative text