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Boomer’s Blueprint: Artificial intelligence in the 2025 tax season

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As CPA firms prepare for the 2025 tax season, artificial intelligence is transforming how they manage tax returns, communicate with clients and handle administrative tasks.

AI can improve efficiency, accuracy and client experience, helping firms streamline processes and reduce manual work. By utilizing AI-powered tools like SafeSend, TaxCaddy, and Aiwyn, firms can optimize tax workflows, improve financial management and deliver the advisory services clients increasingly demand.

Whether you prepare returns internally or outsource them, AI drives innovation across the board.

Automating data aggregation

The process of gathering tax-related documents from clients has long been a bottleneck. AI tools like SafeSend and TaxCaddy are designed to automate and streamline this process.

  • SafeSend Returns: SafeSend Returns helps automate the assembly, delivery and approval of tax returns. Automating the collection of signatures (such as Form 8879) and securely delivering returns to clients removes the need for repetitive manual follow-up. The platform integrates e-signature capabilities, ensuring tax returns can be reviewed, signed and submitted electronically, reducing delays and human error.
  • TaxCaddy. TaxCaddy makes the document collection process smoother by providing clients with a secure platform to upload their tax forms (W-2s, 1099s, K-1s, etc.). Its AI-driven data extraction capabilities automatically capture relevant information from uploaded documents, eliminating the need for manual data entry. AI also helps TaxCaddy send reminders to clients, ensuring they submit all necessary documents on time and reminding them to make estimated tax payments.

Both SafeSend and TaxCaddy are equally effective for internally prepared and outsourced returns. They provide consistent, efficient workflows, reducing time spent on administrative tasks and allowing firms to handle a higher volume of returns with greater ease — in other words, they increase capacity.

Streamlining delivery and e-filing

Once the firm prepares returns, AI-driven solutions play a critical role in automating the review, delivery and filing processes:

  • AI-powered review. AI algorithms can quickly review tax returns, flagging missing forms, potential errors or discrepancies. This step ensures tax returns are complete and accurate before they’re sent to clients, reducing the risk of IRS notices or audits.
  • Smart delivery systems. AI tools like SafeSend automate the delivery of tax returns to clients. These platforms can securely send the completed returns for client review, allowing for real-time updates and approval status tracking. Clients can sign electronically, accelerating the process and filing returns promptly.
  • Automated e-filing. After client approval, AI systems can automatically trigger electronically filing returns with the IRS. Integrating AI into the e-filing process reduces the manual steps, ensuring faster, error-free submissions. It also reduces the administrative burden on staff so they can focus on more complex tasks.
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Automating extensions and 7216 compliance 

Filing tax extensions can be a time-consuming process when it requires manually tracking deadlines and client readiness. AI simplifies this process by automating extensions and compliance with legal requirements:

  • Automating extensions. AI systems can automatically identify clients who are likely to need an extension based on incomplete documentation or prior filing patterns. The system can automatically generate the necessary forms, such as Form 4868 for individual returns or Form 7004 for businesses. Then, it can submit those forms electronically to reduce the risk of missed deadlines.
  • Compliance with IRS Code 7216. IRS Code 7216 requires firms to obtain client consent before sharing taxpayer information when outsourcing tax return preparation to third-party providers. AI can streamline this compliance process by generating and managing the necessary consent forms. It can also automate engagement letter creation, ensuring the firm obtains all legal disclosures and client consents, reducing the risk of penalties for non-compliance.

By automating critical compliance steps, AI helps firms mitigate risks and maintain legal standards while outsourcing work.

Enhancing billing and financial management

AI isn’t only revolutionizing tax preparation; it’s also transforming how CPA firms manage billing, collections and overall cash flow. Tools like Aiwyn use AI to automate and optimize these processes:

  • Packaging and pricing services. Aiwyn’s AI-powered platform helps CPA firms bundle services and develop dynamic pricing strategies. By analyzing historical data, AI can suggest optimal pricing for tax services, ensuring that firms maximize profitability while staying competitive.
  • Automated billing and invoicing. Aiwyn automates the billing process, reducing the time between service delivery and invoice generation. AI can monitor work in process and generate invoices based on completed tasks, helping firms reduce the time it takes to send invoices and collect payments.
  • Improving cash flow. AI also assists in the collections process by sending automated reminders for outstanding invoices and following up with clients. By reducing accounts receivable and minimizing overdue payments, firms can improve their cash flow and reduce the administrative burden on staff.

Elevating client experience 

As firms automate routine tasks through AI, they can focus more on delivering what clients genuinely value — advisory and consulting services. Clients today expect more than tax preparation; they want personalized advice and strategic planning. By freeing up time through automation, firms can provide higher-level services that help clients achieve their financial goals.

AI also enhances the client experience by improving communication and transparency. Tools like SafeSend and TaxCaddy offer real-time updates, automated reminders and secure communication channels, giving clients a more seamless, efficient interaction with their advisors. This elevated client experience builds trust and long-term relationships, which are essential for firm growth.

AI is reshaping the tax practices of CPA firms, providing powerful tools like SafeSend, TaxCaddy and Aiwyn to automate data collection, return preparation, delivery, compliance and billing. These technologies help firms streamline their workflows, reduce errors and improve cash flow, while allowing team members to focus on higher-value services like advisory and consulting. By adopting AI-driven processes, CPA firms can handle tax season with greater efficiency, enhance the client experience, and deliver the strategic guidance clients expect in today’s fast-evolving business landscape.

Firms integrating AI now will be well-positioned for success in the 2025 filing season and beyond. The AI train has left the station. It is time to embrace AI, as it will only accelerate. The transformation triangle requires change management, process management and project management. All of which are driven by leadership and the firm’s vision. 

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Accounting

IAASB tweaks standards on working with outside experts

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The International Auditing and Assurance Standards Board is proposing to tailor some of its standards to align with recent additions to the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants when it comes to using the work of an external expert.

The proposed narrow-scope amendments involve minor changes to several IAASB standards:

  • ISA 620, Using the Work of an Auditor’s Expert;
  • ISRE 2400 (Revised), Engagements to Review Historical Financial Statements;
  • ISAE 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information;
  • ISRS 4400 (Revised), Agreed-upon Procedures Engagements.

The IAASB is asking for comments via a digital response template that can be found on the IAASB website by July 24, 2025.

In December 2023, the IESBA approved an exposure draft for proposed revisions to the IESBA’s Code of Ethics related to using the work of an external expert. The proposals included three new sections to the Code of Ethics, including provisions for professional accountants in public practice; professional accountants in business and sustainability assurance practitioners. The IESBA approved the provisions on using the work of an external expert at its December 2024 meeting, establishing an ethical framework to guide accountants and sustainability assurance practitioners in evaluating whether an external expert has the necessary competence, capabilities and objectivity to use their work, as well as provisions on applying the Ethics Code’s conceptual framework when using the work of an outside expert.  

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Accounting

Tariffs will hit low-income Americans harder than richest, report says

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President Donald Trump’s tariffs would effectively cause a tax increase for low-income families that is more than three times higher than what wealthier Americans would pay, according to an analysis from the Institute on Taxation and Economic Policy.

The report from the progressive think tank outlined the outcomes for Americans of all backgrounds if the tariffs currently in effect remain in place next year. Those making $28,600 or less would have to spend 6.2% more of their income due to higher prices, while the richest Americans with income of at least $914,900 are expected to spend 1.7% more. Middle-income families making between $55,100 and $94,100 would pay 5% more of their earnings. 

Trump has imposed the steepest U.S. duties in more than a century, including a 145% tariff on many products from China, a 25% rate on most imports from Canada and Mexico, duties on some sectors such as steel and aluminum and a baseline 10% tariff on the rest of the country’s trading partners. He suspended higher, customized tariffs on most countries for 90 days.

Economists have warned that costs from tariff increases would ultimately be passed on to U.S. consumers. And while prices will rise for everyone, lower-income families are expected to lose a larger portion of their budgets because they tend to spend more of their earnings on goods, including food and other necessities, compared to wealthier individuals.

Food prices could rise by 2.6% in the short run due to tariffs, according to an estimate from the Yale Budget Lab. Among all goods impacted, consumers are expected to face the steepest price hikes for clothing at 64%, the report showed. 

The Yale Budget Lab projected that the tariffs would result in a loss of $4,700 a year on average for American households.

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Accounting

At Schellman, AI reshapes a firm’s staffing needs

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Artificial intelligence is just getting started in the accounting world, but it is already helping firms like technology specialist Schellman do more things with fewer people, allowing the firm to scale back hiring and reduce headcount in certain areas through natural attrition. 

Schellman CEO Avani Desai said there have definitely been some shifts in headcount at the Top 100 Firm, though she stressed it was nothing dramatic, as it mostly reflects natural attrition combined with being more selective with hiring. She said the firm has already made an internal decision to not reduce headcount in force, as that just indicates they didn’t hire properly the first time. 

“It hasn’t been about reducing roles but evolving how we do work, so there wasn’t one specific date where we ‘started’ the reduction. It’s been more case by case. We’ve held back on refilling certain roles when we saw opportunities to streamline, especially with the use of new technologies like AI,” she said. 

One area where the firm has found such opportunities has been in the testing of certain cybersecurity controls, particularly within the SOC framework. The firm examined all the controls it tests on the service side and asked which ones require human judgment or deep expertise. The answer was a lot of them. But for the ones that don’t, AI algorithms have been able to significantly lighten the load. 

“[If] we don’t refill a role, it’s because the need actually has changed, or the process has improved so significantly [that] the workload is lighter or shared across the smarter system. So that’s what’s happening,” said Desai. 

Outside of client services like SOC control testing and reporting, the firm has found efficiencies in administrative functions as well as certain internal operational processes. On the latter point, Desai noted that Schellman’s engineers, including the chief information officer, have been using AI to help develop code, which means they’re not relying as much on outside expertise on the internal service delivery side of things. There are still people in the development process, but their roles are changing: They’re writing less code, and doing more reviewing of code before it gets pushed into production, saving time and creating efficiencies. 

“The best way for me to say this is, to us, this has been intentional. We paused hiring in a few areas where we saw overlaps, where technology was really working,” said Desai.

However, even in an age awash with AI, Schellman acknowledges there are certain jobs that need a human, at least for now. For example, the firm does assessments for the FedRAMP program, which is needed for cloud service providers to contract with certain government agencies. These assessments, even in the most stable of times, can be long and complex engagements, to say nothing of the less predictable nature of the current government. As such, it does not make as much sense to reduce human staff in this area. 

“The way it is right now for us to do FedRAMP engagements, it’s a very manual process. There’s a lot of back and forth between us and a third party, the government, and we don’t see a lot of overall application or technology help… We’re in the federal space and you can imagine, [with] what’s going on right now, there’s a big changing market condition for clients and their pricing pressure,” said Desai. 

As Schellman reduces staff levels in some places, it is increasing them in others. Desai said the firm is actively hiring in certain areas. In particular, it’s adding staff in technical cybersecurity (e.g., penetration testers), the aforementioned FedRAMP engagements, AI assessment (in line with recently becoming an ISO 42001 certification body) and in some client-facing roles like marketing and sales. 

“So, to me, this isn’t about doing more with less … It’s about doing more of the right things with the right people,” said Desai. 

While these moves have resulted in savings, she said that was never really the point, so whatever the firm has saved from staffing efficiencies it has reinvested in its tech stack to build its service line further. When asked for an example, she said the firm would like to focus more on penetration testing by building a SaaS tool for it. While Schellman has a proof of concept developed, she noted it would take a lot of money and time to deploy a full solution — both of which the firm now has more of because of its efficiency moves. 

“What is the ‘why’ behind these decisions? The ‘why’ for us isn’t what I think you traditionally see, which is ‘We need to get profitability high. We need to have less people do more things.’ That’s not what it is like,” said Desai. “I want to be able to focus on quality. And the only way I think I can focus on quality is if my people are not focusing on things that don’t matter … I feel like I’m in a much better place because the smart people that I’ve hired are working on the riskiest and most complicated things.”

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