Leveraging IT for State Tax Departments During the Pandemic.

• Position: Tax Executives Institute, information technology

It's difficult enough to manage state tax departments in "normal" times. But imagine if you had to do it in a pandemic. No imagination necessary anymore, of course. It's as real as it gets, and we wanted to find out what this "new normal" has really been like, so, not surprisingly, we convened a panel of tax leaders to participate in this issue's roundtable, including Rob Clary, former state tax manager with Ford Motor Company and now a member of PTS Services LLC, a boutique firm providing tax services to Ford and other companies; Linsey Morgan, senior tax accountant at DRB Systems, a technology and marketing company for the car wash industry; and David Shrontz, senior tax operations manager with Baker Hughes. Tax Executive's senior editor, Michael Levin-Epstein, moderated the discussion.

Michael Levin-Epstein: When the pandemic burst on the scene, how did you start the management of your state tax department to deal with it? How did you discuss that process?

Linsey Morgan: DRB's process is going to be a lot different than most other companies, as we had just brought all tax functions in-house at the end of 2019. The 2019 tax returns were the first year of gathering information, preparing, and filing all the returns. At the time of the pandemic, there were only two people in the tax department: my boss, Dennis McGregor, and me. I was responsible for all the tax functions, which included sales and use, state and local income tax, prepare K-1s, and prepare the federal return. I also needed to create processes for DRB's new tax functions. My original plan was to write down the process I used to complete each task. I would then analyze the tasks and find out what worked and what needed to be improved. Well, let's just say my original plan flew out the window at lightning speed early on in lockdown. What was most difficult was writing up processes for different tax functions when I or another employee was not in our "natural" work environment. On a positive note, I learned a lot, which I believe has better prepared me for the 2020 tax season. Also, my third grader learned about depreciation [and] sales tax and could probably prepare a tax return better than some adults.

David Shrontz: Around the time that the news of the spread of COVID-19 came out, we had had plans to hold some on-site management meetings, but those plans were immediately canceled, obviously. There was a brief scramble to cancel travel arrangements and revise the meeting format, and thankfully the meetings were held more or less as originally planned. There have also been many other similar situations where the traditional means of getting together for kickoff meetings, project workout sessions, etc., were no longer feasible for us to do in person. So, we had to get creative and rely on virtual meetings using Teams, Skype, and other tools to collaborate. Not being able to be physically together in a room and have a whiteboard where we could delve into the details face-to-face required us to rethink our approach. The timing of COVID was unfortunate, because we've had a lot of projects this past year. Most have been driven by organizational changes, while others are for simplification and consolidation of ERPs, tax engines, and other systems as well as for process streamlining and automation. The timing of the projects that we have had has been concurrent with the lockdowns and travel restrictions, so the teams have had to adapt. I have to say, however, that people have really done a great job of collaborating and figuring out how to achieve our goals virtually. Granted, it's not quite the same not being able to be together in a room, and this is more evident with team-building...