It was an exciting year for everyone here at Taxing Subjects. We covered interesting and relevant tax industry updates, interviewed successful tax professionals, and provided resources to help readers keep track of changes in tax law. While it’s impossible to cover everything, here’s a look back at some of the important events and blog posts from last year.
SCOTUS, Scams, and Security
2015 began much like 2016. Congress passed extenders legislation, which meant that tax season would start on time. After adjusting to changes instituted by the Affordable Care Act, the possibility of major change loomed on the horizon: the Supreme Court (SCOTUS) agreed to hear oral arguments for King v. Burwell in March, 2015. The plaintiffs argued that subsidies offered to low-income taxpayers enrolled through federal-run exchanges were illegal due to specific language in the ACA stating that tax credits were only available to individuals enrolled in state-run exchanges. In June, SCOTUS ruled, 6-3, that the intent of the law was to provide nationwide health coverage. It remains to be seen if the first half of 2016 will be dominated by further legal challenges.
Oklahoma, Texas, and South Carolina suffered catastrophic flooding, prompting the IRS to issue grants of relief for those in affected areas and to warn would-be donors against fake charities and scams. Some California residents faced the threat of yet another wildfire, and taxpayers across the country dealt with another round of ID theft – this year worrying about both credit card- and SSN-based fraud in the wake of the “Get Transcript” security breaches.
Security was a major theme for 2015. The IRS, states, and tax industry leaders held a security summit in June focusing on improving taxpayer authentication, fraud identification, cybersecurity frameworks, and more – all in an effort to plug holes in the industry’s security apparatus. Following considerable coverage of ID theft events, we also saw Senators Hatch and Wyden introduce a new bill that – along with combating identity theft – resumed plans for giving the IRS the power to regulate tax preparers.
A Mom and Pop Practice, a Side Project, and a Family Legacy
Ben Tallman, the first featured tax professional of 2015, learned to prepare taxes in the military. When he transitioned to civilian life, Tallman and his wife built a successful practice – preparing over 700 returns each year: “We handle whatever comes our way – exempt-organizations, corporations, trusts, estates, partnerships, homeowners associations, rentals, small businesses, non-residents, foreign returns, individuals, consultations, and representation work.”
Tallman also writes articles about tax preparation and has been a regular contributor to Taxing Subjects, often focusing on the need for operating an ethical practice: “No matter how much you want to serve and please your customer, you must remain true to yourself. Your trustworthiness, your credibility, your ethical values, and even your survival in this business depend on you doing the right thing, regardless of what the customer demands.”
In the spring, we met Frank Degen: a solo practitioner from Setauket, New York who began preparing taxes in his spare time while working as a high school math teacher, eventually becoming a full-time tax professional and two-time president of NAEA. An EA since 1984, Degen reduced the number of returns he prepares, but insists that he doesn’t plan to retire: “This is one of the best jobs a person can have.”
Today, he serves roughly 300 individual and non-profit clients, but no longer prepares business returns. Degen says that this lets him spend more time with his wife, two children, two grandchildren, and – of course – the family dog: a black lab named Beau.
The last preparer we interviewed for 2015 was Terry Durkin, the current president of NAEA. Durkin was inspired to become a tax professional by her late mother, who was diagnosed with lung cancer in 2003: “I can’t describe my mother in just one word: she was my role model, my friend, my mentor, and so much more. She was influential in every part of my life.”
Durkin worked in the software industry for 19 years before returning home to help her mother, leading to a permanent career change. During our interview, she reflected on her time at her mother’s practice. “At the time, I had been thinking about a career change; I was thinking about getting my EA license, but learning about my mother’s illness accelerated my decision.” Her practice, which specializes in individual, small business, trust, and estate tax returns, now has two locations and serves roughly 350 clients annually.
The fall interview was something a bit different; we focused on a Drake Software employee: Jennifer Dills, Vice President of Finance. From Cullowhee, North Carolina – just a stone’s throw from Drake’s hometown – Dills accepted what she thought would be a temporary position at the company after finishing college. 13 years later, and she wouldn’t want to be anywhere else: “This is where I need to be.”
Reference Documents, Business Strategies, and Closing out the Year
To help tax professionals have a smoother tax season, we provided links to several resources that put important information at your fingertips, publishing a number of Drake Software’s guides – including their annual Desk Reference Guide (you can get a copy of this year’s guide here) and their new ACA guides.
Aside from reference material, several of the Taxing Subjects blogs focused on advice for running a successful practice. Whether thinking about working from home, changing Facebook habits, better protecting a network from Wi-Fi hacking, we covered a variety of topics to help with both short- and long-term business strategies.
Finally, thanks to all of you, our readers, for giving us another great year. Your comments, emails, and readership are appreciated. Have a happy 2016!