Successfully converting to in-house tax processing.

• Author: Burke, Anne A

It is always risky to make changes to processes or procedures directly affecting a major area of a practice, particularly tax procedures during tax season. Although they are only implemented with the best of intentions, changes that are perceived to be a "boom" can easily turn into a "bust" between January and April.

This past tax season our firm changed the entire tax preparation process for individual 1040s by converting to in-house processing. For the past 15 years, the returns were prepared on input forms, keypunched by in-house computer operators, and transmitted via modem to the area processing center. The returns were printed at the processing center and delivered via common carrier back to the office. After installing a LAN network in Fall 1991, we purchased interactive tax preparation

V software that enabled in-house calculating, processing and printing. All our accountants, staff through partner, input the information directly into the computer (bypassing the input forms and the keypunch operator), view the forms on screen and print the return on nearby laser printers.

Fortunately, our 1992 tax season and its conversion to in-house processing can be remembered as more of a "boom" than a "bust." In retrospect, the success of the conversion was attributable to the immense amount of planning and organizing that went into the purchase, training and support of the software.

Based on our successes and failures, we have compiled suggestions for those who are considering a similar conversion to in-house processing.

* Determine the objective in converting, and buy the program

V to meet them: Changing to in-house processing was prompted by a desire to streamline the tax preparation process by eliminating duplicate handling of the tax return and to enhance the preparer's understanding of tax law.

The preparation process is streamlined by having the accountants input the information directly into the company, thus eliminating many of the clerical steps involved in transmitting, tracking and delivering the returns. This has the added benefit of enabling the accountants to prepare returns when it is beneficial for them; they do not need to depend on anyone else or coordinate with anyone else's schedule. Moreover, they are bale to complete the return at one sitting. This not only eliminates duplicate professional time incurred in the repeated handling of a return, but also eliminates the mental stress associated with repeatedly seeing the same...