As many CPAs have demonstrated in recent years, tax technology delivers a dual benefit. These tools help CPAs calculate tax more easily for clients while enabling them to devote more time to analyzing how tax can be managed more strategically within their clients’ businesses.
Of course, the interrelated realms of tax and technology change constantly. As a result, it makes sense for CPAs to keep tabs on the most notable of these shifts, including the following trends:
2019 is the year of the hybrid cloud: While initial adoption of cloud technologies tended to make use of the public cloud, that’s clearly changed. As cloud technology usage increases, more IT and business leaders are realizing that a one-size-fits-all solution is not the right approach for many organizations. CPAs and their clients should be aware of the benefits of tax solutions that solve problems through flexible deployment options, including on premise, public and private cloud. This flexibility can deliver the freedom to adjust tax technology approaches as tax compliance needs change.
Real-time tax is real: Consumers and governments increasingly expect to reap the benefits of tax calculations and returns that are generated the moment a purchase happens. Tax technology is both driving and fulfilling these changing tax expectations. CPAs and the businesses can meet these intensifying consumer expectations and regulatory requirements by investing in tax technology that accurately calculates tax in real time rather than relying on rate tables and manual upkeep.
Digital is changing what’s taxable: Last year ushered in momentous changes regarding what is taxable in the digital world. The South Dakota v. Wayfair decision, for example, will have a major impact in 2019 as companies will be required by more states to impose tax on out-of-state buyers. This change, and others, require smaller companies to keep closer track of where their online customers are from and the changes in tax rules within those states.
Despite the speed and magnitude of tax and technology-related changes, companies can minimize those impacts with the right technology in place. For more on this topic, click on my recent CPA Practice Advisor article here.
Please remember that the Tax Matters provides information for educational purposes, not specific tax or legal advice. Always consult a qualified tax or legal advisor before taking any action based on this information.