‘Tis the Season

’Tis the Season to Shine!

Elevating your clients’ experience during tax season

DECEMBER 23, 2015


Few CPA firms see tax season as the time for investing hours in business development. But those who have, have come to John Napolitanorealize that there is no better time to elevate the service experience for your clientele and talk about issues that matter most to your very best clients.

Like it or not, your clients rate getting their taxes done as one of their least favorite activities. It may not be as painful as a root canal, but many would rather suffer the numb jaw of becoming the passive recipient of a needed service than have to proactively gather data and silly little slips of paper to enter them into your tax organizer. Having a discussion about personal financial planning during tax season won’t ease the pain of pulling together tax information — but it can help connect the dots between tax prep and a better financial life.

The first part of elevating the experience comes merely from a client working with a CPA who is not so hurried and short with their time. Making their trip or phone call to you each tax season more hospitable can immediately change their perception from a root canal to a wellness visit. Clients feel that they’ve invested a lot of time getting all their stuff together, so rushing them out the door as soon as you see that the package is complete is unfulfilling for them. Many feel that they spend more time on gathering than the tax preparer spends in total, as they view your job as merely putting their data into a computer, which then does the work for you. You and I know differently, but their perception is their reality. 


Other experience-killing tactics include barking orders at your client about the obvious deficiencies that you see in their financial lives. Many times after teaching my “Tales of the Tax Return” course, CPAs let me know that they’ve been telling many of their clients to resolve these glaring open issues for years. But suggesting to your clients that they use up their loss carry-forwards or that they see a lawyer for a new estate plan is obviously not working if you continue to spot the same issues year after year. Even if you’ve given them the name of a competent professional to help with a particular issue, your off-the-cuff advice is likely to be lightly regarded. The disconnect is with the dispensation of the advice. Your clients don’t want to be told what to do in sound bites. They want to receive the advice in a way that is conducive to getting it done.

That means you taking an active role in leading the effort, or at least walking them in the front door of that competent professional and segueing from your observations to an action plan that will resolve the issues.

Another ineffective way to elevate the service experience is to tell them how busy you are, and that you’d like to take up these issues after tax season. While they’ve just invested the time to gather data and meet with you, the iron is still hot. Their mind is clearly set on financial matters and they are likely receptive to your valuable advice at that time. The best practice is to whip out your calendar and set a time to get started on what it will take to clean up their entire financial house. If your firm does not offer financial planning services, the act of setting a time to personally walk them into the office of a competent financial professional is the kind of concierge-level service one would expect to receive from world-class service organizations such as the Ritz-Carlton or Lexus. When you are staying at a Ritz and want to know where the exercise room is located, someone will typically rise out of their chair and walk you to the destination. That’s a lot different than just telling them where to go or what to do.

If you really need to, or they are snowbirding for the winter, setting an appointment for post-April 15 is not the end of the world. You may run the risk, however, of allowing your PFP conversations to go stale and might need to start all over again when you eventually meet. To mitigate staleness, have your staff or the staff of a competent planning firm prepare them for a financial planning engagement by letting them know what other documentation you’ll need for the plan. This will help to set their expectations to close the loops on any and all financial matters needing attention. This alone will elevate their impression of your services and emphasize how much you care about them.

During the process of tax preparation, you must allow a little extra time to talk about some of the issues you spot and to ask probing questions about what you see to discover even more holes in the plan.

If your tax practice resembles a tax sweat shop, with way more returns to do than any one human should — good luck. The only way for you to spend more time with your better clients to talk about financial planning will be to either work more hours (yuck) or hire additional help with tax prep so you can act like the partner you are (or are trying to be). If your tax services focus on higher-net-worth taxpayers or business owners, then budget an extra 15 minutes into the tax engagement. The extra time will be well-received and beneficial to all.


Perhaps the most difficult part of this process for CPAs is to help your better clients recognize that there are gaps that need to be plugged. This is not easy for your better clients. High-net-worth clients have a few characteristics that inadvertently cause their ears to close to your advice. First is that nearly everyone they meet is trying to sell them something. Whether it is insurance, asset management or legal services — they feel over-solicited and certainly don’t want their most trusted advisor, their CPA, to join the ranks of the sales dogs and start hustling them for more hours.

The second issue that causes blind spots is their own success. Many of your better clients make more money than they need for their lifestyle and their bucket list. When they know that they can afford just about anything they want, they may feel that they don’t need any guidance. On top of that, they’ve probably got a successful broker, lawyer, property and casualty agent and so forth already on their team. They surround themselves with equally successful people that they’ve met from their social circles or golf club who may or may not be doing a complete job for them.

This is where your issue-recognition skills will cause their ears to perk up and recognize that what you are talking about may be exactly what they need: a leader to help close the gaps and help them get the rest of their financial house in order. You won’t have to go too far down the tax return to spot the issues that will relate best to these top clients.

In fact, the first and often the most important issue in their lives doesn’t involve numbers at all. It is a discussion about the family. Whether your clients have dependents on their tax return or all of the children are adults, start a discussion about their family. For those with young children, ask about their health and activities. Learn about their thoughts on higher education, and how that will be funded. Ask about their adult children, and what they are up to professionally and personally. Ask about the health of their marriages, the health of their grandchildren and the relationship that they have with their children about money. Does your client help support the children? Do they make regular gifts? Have they helped with college savings accounts for the grandchildren?

Once you feel that you understand the family landscape, ask about your client’s estate plan. Don’t be too surprised to discover that even your best clients are likely to have an outdated or incomplete estate plan. “Severely outdated” would be simple wills leaving everything to a surviving spouse, then equally to the children upon the passing of the second spouse. This plan may lead to a time-consuming probate-clearing process, a blown unified credit, or assets flowing directly to children too young to handle any significant sum of money. Would your life have been different if an uncle told you at age 21 that your parents left you $1 million where you had full discretion and outright access at that ripe young age? This question may sound rhetorical for some, but is a possible reality for too many of your clients and their simple plans.

For their married children, ask if they’d be bummed out if their child lost half of their inheritance to a future divorce. Most would agree that this is not optimal, and would go back and change the plan if they could after their passing. The same may be true for a child who passes away right after you. Leaving assets outright to your child may then leave them outright to their spouse after their passing. Should that spouse later remarry it is entirely possible that your grandchildren won’t see a cent. The answer may be in a series of trusts with restrictions and strong trustee selections — but don’t simply send your client to an attorney to fix this issue. Deeper conversation in the context of an overall financial plan will shed even more light and likely deliver a stronger plan than if an attorney merely served up their boilerplate trust for your clients.

Also, climb up the family tree and ask about their aging parents. Once again, don’t be too shocked if your client knows nothing about the parents’ plan or to discover that the 80-plus-year-old patriarch has an unsuitable estate plan. Ask your clients what their role is in the elder caretaking of their parents or the settling of their parent’s estate. Once again, you are most likely to receive a vacant stare rather than a precise answer.

The process of issue recognition during tax preparation is easy. We could go on for pages about the hundreds of issues hidden in plain sight that a few simple questions will uncover. Your job here is to elevate the service to your client, not to discover every issue during the tax preparation process. The elevation of service through financial planning is time-consuming and clearly a separate engagement. Treat the PFP engagement with respect and enthusiasm because it can be a lot more fun and profitable for your clients and the firm than tax preparation. 


John P. Napolitano CFP, CPA, is CEO of U.S. Wealth Management in Braintree, Mass. Reach him through JohnPNapolitano on LinkedIn or (781) 884-2390.