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Voices

Art of Accounting: My big tax season opportunities

When I started working, in 1963, the IRS had a policy where everyone preparing and signing tax returns had to be an enrolled agent. There was a test, as there is today, but CPAs and lawyers were made enrolled agents upon applying without needing to take the exam. There was a rumor that when you applied, you were audited. So, to avoid the possibility of an audit, I took the exam just after I started working. This also gave me a credential for my moonlighting activities, which started right away. The studying for the exam made me somewhat more knowledgeable in taxes than the other junior accountants.

When I started my third job, I was told I would be doing two very important things during tax season. The first was that I would go through every client’s previous four years of tax returns and enter the taxable income on worksheets. Income averaging was brand new and this information was needed to determine whether a client would be entitled to benefit from this. It seemed like it would be drudgery, but it actually was very interesting. I learned the names of every client, how much they made, the growth of their income and where they lived. It made me instantly familiar with them.

But I was also told, “You are being given the most important job in the firm. You will be the last person in the firm to look at every clients’ completed tax return.” My job was to assemble the returns that came out of the copier! Actually, this became very interesting since I started trying to find errors — and I found plenty of errors. I always had the right attitude. Even though I was given two lemons, I was able to make delicious lemonade from them.

tax planning-1040-IRS
U.S. Department of the Treasury Internal Revenue Service (IRS) 1040 Individual Income Tax forms for the 2016 tax year are arranged for a photograph in Tiskilwa, Illinois, U.S., on Monday, Dec. 18, 2017. This week marks the last leg of Republicans' push to revamp the U.S. tax code, with both the House and Senate planning to vote by Wednesday on final legislation before sending it to President Donald Trump. Photographer: Daniel Acker/Bloomberg

Assembling returns gave me the opportunity to look at every page and that became a valuable review technique I still use and teach today. The brain absorbs everything and has a knack for finding exceptions — things that aren’t as they are supposed to be. This helped me immensely when I moonlighted or was finally given returns to do since I established a vast database of tax knowledge from this.

One final point I want to make concerns how firms operate during tax season today. My job required me to work two nights from 5:30 to 8:30 and five hours on Saturday 9:30 to 3:30. This gave me plenty of free time on nights and weekends to conduct my personal life including dating and trying to get dates, moonlighting and taking night courses. I did all three, and then some. I feel that staff today does not have the freedom of personal time management I did, and this is a reason many really good people leave public accounting. I believe firms need to address this ASAP.

Everything I did early on, and still do, presented and presents opportunities. If you do not feel you have opportunities, then I think you are missing something valuable in your life. I welcome comments at emendlowitz@withum.com about your personal experiences.

Edward Mendlowitz, CPA, is partner at WithumSmith+Brown, PC, CPAs. He is on the Accounting Today Top 100 Influential People List. He is the author of 24 books, including “How to Review Tax Returns,” co-written with Andrew D. Mendlowitz, and “Managing Your Tax Season, Third Edition.” Ed also writes a twice-a-week blog addressing issues that clients have at www.partners-network.com along with the Pay-Less-Tax Man blog for Bottom Line. Ed is an adjunct professor in the MBA program at Fairleigh Dickinson University teaching end user applications of financial statements. Art of Accounting is a continuing series where Ed shares autobiographical experiences with tips that he hopes can be adopted by his colleagues. Ed welcomes practice management questions and can be reached at (732) 964-9329 or emendlowitz@withum.com.