Every time a CPA or CPA firm takes on an individual or business as a tax client, the demand for their services rises, making extending their tax services harder. The complete CPA tax services process entails providing tax planning advice, gathering relevant documents, calculating taxes owed, and filing tax returns.

As a result, the demand for knowledgeable tax professionals rises to handle the tax preparation process as there are more clients. Therefore, the best action may be to recruit outside tax specialists to handle tax return preparation at your CPA firm.

Tax preparation services can be outsourced for various reasons, including access to specialized expertise, improved efficiency, and cost savings.

  • According to a survey by the American Institute of CPAs (AICPA), 56% of CPAs reported that outsourcing tax preparation allowed them to save time that could be better spent on other high-value activities.
  • Additionally, a survey by the Institute of Management Accountants found that 43% of professionals mentioned that outsourcing tax preparation helped them achieve greater efficiency.

Top Signs for CPAs to Outsource Tax Preparation Services

1. Increased volume of tax returns
One of the early signs to outsource CPA tax services is an increase in the volume of tax returns that need to be filed. As a CPA, when your business grows, so does the number of tax returns. This can soon become an overwhelming task for an in-house professional, especially if you need to be equipped with the needed resources or expertise.

Recruiting new team members on demand can be challenging and time-consuming. Outsourcing tax preparation processes can help alleviate this burden by providing additional support and resources.

2. Lack of expertise at in-house

Not complying with tax laws and regulations can result in costly fines and penalties or interest. There is a need to stay updated with all of the new tax laws and regulations that may be introduced. Not knowing the latest tax laws can result in compliance issues and fines.

However, as an individual CPA, this may take time to incorporate. Also, tax preparation can be a complex process requiring specialized knowledge, skillsets, and, most importantly, expertise. Therefore, it is challenging to find reliable resources to handle tax returns.

Outsourcing tax services to an external provider with the necessary expertise can ensure that tax returns are prepared accurately and in compliance with all relevant regulations and help avoid penalties.

3. Limited time to manage client requirements

Tax preparation is time-consuming and complex, especially for CPAs working with clients from different backgrounds operating in multiple states or countries.

In addition, in-house expertise may be limited concerning the right resource for state/industry-specific tax preparation and the need for automation processes. Therefore, outsourcing tax preparation can help a CPA firm save time and effort by providing additional support and resources.

4. Cost

Working with an in-house tax preparation team can be expensive, primarily for small and medium-sized CPA firms.

However, outsourcing tax preparation to a third-party provider can provide a more cost-effective solution. CPAs only pay for their needed services and save money on overhead expenses, such as office space and equipment. Moreover, you will be able to help your client with maximum refund guarantee with accurate filings.

Best practices to incorporate while outsourcing tax preparation services

1. Set clear expectations and streamline communication

It is essential for businesses to establish clear lines of communication with their external provider and to ensure that both parties are on the same page regarding expectations, deadlines, and deliverables.

This helps ensure that the outsourcing process runs smoothly and that both parties are satisfied with the outcome.

2. Share complete and accurate information

CPAs must ensure that they provide their external provider with all of the necessary information, including financial statements, tax returns, and other relevant documents.

This will help ensure the external provider has all the relevant information needed to prepare accurate and compliant tax returns.

3. Monitor and improvise on the processes

This helps identify areas where the process can be improved and ensures that the external provider is meeting all of the agreed-upon expectations and deliverables.

4. Prioritize data security

CPA firms require keeping sensitive financial and personal information secure. Therefore, it is important for CPAs to choose an external provider with robust data security measures to protect all sensitive information from unauthorized access and ensure that all data is kept confidential.

This helps ensure that sensitive information is kept secure and the business is protected from data breaches. Also, remember to sign an NDA with the services provider so that they can also keep everything about you private.


Some clear signs need to be considered when managing bandwidth issues. When you outsource your tax preparation services during heavy tax situations, it is important to ensure that the process runs smoothly and that the outcome is successful.

Businesses should follow best practices such as setting clear expectations and communication, providing complete and accurate information, continuously monitoring and improving the process, and ensuring data security.

Additionally, businesses should choose an external provider with the necessary expertise, experience, and robust data security measures. By following these recommendations, CPAs can ensure their tax preparation is accurate, compliant, and secure.

It is recommended to outsource your tax preparation services to a reliable organization like Accounting To Taxes. We have varied offerings within accounting services, from bookkeeping to tax preparation.

Connect with our team of experts at Accounting to Taxes to understand your needs and find apt solutions for your business requirements. Contact us at +1 646-688-2821 or send an email to [email protected]

Read Also:

How to Improve and Prepare Your Practice for This Busy Tax Season

6 Pertinent Tips for Making Tax Preparation Simpler