4 Tips to Digitize the Shoebox This Tax Season

March 11, 2015


“It’s the Most Wonderful Time of the Year” is a song frequently heard during the holiday season, but many practitioners are singing it aloud now that the 2015 tax season is in full swing, which means many of you are working very hard to meet client deadlines. During the heat of peak times, however, many of us are so focused on dealing with this year’s shoebox that we don’t always think about how we can help clients break the cycle of shoeboxes that increases the stress to both client and accountant.

I’m currently writing the analysis of a technology and management survey from over 600 US accounting firms which will be published later in the first quarter of 2015. When these accounting professionals from firms of all sizes were asked “What is the biggest technology challenge that you foresee when managing your practice in the next 1-3 years?”, the top three answers were as follows:

  • Workflow and efficiency (31%)
  • Getting your clients on board to work with your firm in a more digital way (16%)
  • Creating and implementing an effective technology strategy (12%)

While two of these items are probably not areas you would want to change significantly during busy season (workflow/processes, technology strategy), the third concern (getting clients to work with your firm in a more digital way) can be addressed during times when you are already interacting with these clients. Some ways do accomplish this include:

1. Ask your clients to provide requested items in a digital format

Twenty years ago, most individuals and firms tracked and filed the majority of their documents in a paper format. There has been a fundamental shift over the last ten years where the majority of records are created, used, and filed in a digital format – without ever being printed on paper. Unfortunately, many firms have not revised their engagement letters, organizers, lists of requested schedules, and other internal processes to express that we prefer to receive the client’s documents in a usable electronic format. Companies like Neat also provide scanners, software, and cloud-based solutions to help clients extract useful data from receipts, documents, and other paper records as they are converted to digital files.

2. Use data aggregation services to automatically gather invoices and statements from others

A new breed of services like FileThis Fetch and HubDoc are helping clients gather their important bills, documents, and statements for a small monthly fee. Users who sign up for the service enter their online credentials for supported services, and the documents are automatically retrieved and placed in the cloud storage tool of your choice.

3. Remind your clients to download their data from bank and vendor websites

Even if your client doesn’t want to use one of these applications, you can remind them to download their 2014 transactions from websites before the records are archived by the vendor (usually 12-18 months). Most invoices and statements can be downloaded in Adobe Acrobat (PDF) format, and bank transactions can usually be obtained in either CSV or Excel format for a limited period of time. You may also want to remind your clients to gather their statements for the previous three months in your instructions for making required quarterly tax deposits.

4. Helping them automate manual processes with FreshBooks

While many of your self-employed and small business clients will use desktop accounting software like QuickBooks or Sage 50, surveys show that the most popular accounting solution for very small businesses is still Microsoft Excel. Using a cloud-based tool like FreshBooks makes it easier for your clients to create professional customer invoices, monitor their collection, and prepare revenue and expense reports for you to import into your accounting and tax software tools.

There are many other tools and tricks one can use to help clients provide more useful digital records, but just like an exercise program, they are useless if you don’t use them. The investment in time to create a generic set of instructions/procedures is minimal, the payoff is significant, so why don’t you and your team work on this now. The 2015 year has already started, and if you don’t get your shoebox clients working digitally now, you’ll get the same jumbled box of paper this time next year. Furthermore, most clients will feel better about themselves, their businesses, and their relationship with your firm if you coach them to get what you want and praise their successes.

Do the right thing for yourself and your clients – help them break the cycle of disorganization by coaching them to work with you in a more digital way today.


about the author

FreshBooks is the #1 accounting software in the cloud designed to make billing painless for small businesses and their teams. Today, over 10 million small businesses use FreshBooks to effortlessly send professional looking invoices, organize expenses and track their billable time.