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Estimated reading time: 13 minutes, 20 seconds

Battlefield Research – Where Experience Pays!

It’s harvest time and our colleagues all over America are “burning the midnight oil” in an effort to stem the ever-rising tide of personal tax returns our profession is charged to prepare. In a perfect world we’d have met with most (many, some, a few …) of our clients back in September for a preliminary tax planning session. Yeah, and in that world I’d exercise daily, floss after every meal, write in my journal regularly, and spend more quality time with my spouse. And none of my clients would be fee sensitive, and all would be proactive in financial matters. I wonder what color the sky would be in that world.

The reality is that while tax compliance software vendors claim nearly 250,000 firms as customers (the number is somewhat exaggerated by inconsistent definitions, dual usage, marketer-counting, etc.) only a tiny fraction of those firms have invested in true “tax planning” software. The fact is that we, as a profession, don’t seem to have the time or the inclination to “sell” tax planning services and our clients don’t seem to have the desire or the budget to “buy” it. So, we end up doing “battlefield research” in an effort to piece together the best possible result with virtually no control over the fact patterns. The tax profession is annually faced with a triple whammy of workload compression, non-compliant clients, and an ever-changing tax code. Fortunately we’ve served by a vendor community that, as a whole, works very hard to understand our plight and to provide tools to help meet the challenge. These vendors “feed at the trough” of the public accounting profession and it is in their best interest to keep us a productive and profitable as possible. Fortunately for us they are very good at what they do. In the past dozen or so years they’ve moved from print, to CD, to web, and with each iteration they’ve added more and more “intelligence” to their raw content. From Code to Regs to case law to interpretation to context to practice tools the products have evolved to become true “knowledge management” -- most definitely a huge leap from the 1980s black (or blue or burgundy) books with gold lettering.

There’s an old joke about an electrician who, after fixing a wiring problem in 3 minutes presented a bill for $200. It was itemized as follows: Connecting loose wire $25; knowing which wire was loose $175. In many ways that reflects our profession. We’re paid because we know (or can quickly find) which wire is loose. The “or quickly find” is where the vendors come in. Their products make it possible for us to learn what we need to know just in time and as the need arise.

In this review we’ll look at the entire genre of tax research products. No practice will need all of these products and no product (despite the most adamant marketer) can appropriately serve every practice style. Size and client complexity drive tool choice. Remember, whatever your decision, it is YOU, the professional, who are ultimately responsible for determining the correct answer --- for both you and your client tax situation. These products may well make your work easier, but the responsibility is still yours.

CCH SMALL FIRM SERVICES – TOTAL KLEINROCK OFFICE

The Total Kleinrock Office is available as a web-based service or via CD and is priced at $699. Designed specifically for the smaller, tax-centric office, it is a complete research and reference package including analysis, primary source material, the IRS code, more than 10,000 forms, and two handbooks. It provides search and browse functions across multiple libraries and resources via single interface. The main page contains all of the expected hyperlinks to quickly get you to where you want to be in the listing of your specific online products. To search you select the library, specify the search terms and go. A typical “advanced-style” interface in available for multi-library, phrases, or proximity searches.

Included components are:

  • Federal TaxExpert: Analysis and supporting information in 25 volumes of expert analysis covering codes, regulations, and over 100,000 cases and rulings
  • Employment TaxExpert: to minimize risk, determine taxable income, calculate payroll taxes and work with payroll outsourcing companies
  • ZillionForms:  A comprehensive forms library available with over 10,000 forms and 20,000 calculating worksheets
  • U.S. Master Tax Guide: Kleinrock Edition: Quick-reference information for common tax topics involving individuals, partnerships, S and C corporations
  • 1040 Express Answers: Basic, quick-reference information concerning 1040 returns
  • Practical Tax Bulletins: Alerts covering new tax legislation, regulations, selected tax case decisions, IRS rulings, and other important tax news.

The Total Kleinrock Office is a very solid bargain and especially appropriate for ATX and TaxWise users because they can take advantage of the considerable integration provided by CCH Small Firm Services.

BNA TAX PRACTICE LIBRARY

The wholly employee-owned BNA has been a staple of the professional tax researcher for generations. Although its move to the web was a bit stilted early on there is no doubt that it has now mastered the transition. Its Tax & Accounting Center is the entry point for all of its 14 online research products. For purposes of this review we quickly centered in on the Tax Practice Library. It is reasonably priced at about $700 and includes a solid range of practical analytical research, compliance, and productivity tools.

BNA’s historic strength is in expert analysis. Tax Practice Library topics include analysis on gross income, deductions, tax credits, C Corporations, pass-through entities, compensation planning, estates and trusts, exempt organizations, private foundations, and foreign taxation. While the breadth is impressive some smaller practitioners might find some of the topics extraneous. On the other hand they should be very impressed with BNA’s very well developed practice tools which include client letters, forms with line-by-line guides, many tables, charts, and lists, and a federal tax calendar. Federal and state forms are available as an optional add-on. Finally, Tax Practice Library includes the full text of the IRC, all regs (final, temporary, and proposed), Revenue Rulings, Revenue Procedures, Notices and Announcements, and IRS Publications. Those involved with heavy-duty research will appreciate the inclusion of full text of selected legislation (with committee reports) and the Coordinated Issue and Industry Specialization Papers. Finally the library includes all federal tax cases (full text). BNA’s Tax Practice Series Bulletin is a biweekly feature covering new developments in planning, proposed IRS regulations, and selected court decisions. Several other periodic reports are also available.

Operationally the BNA product offers a customizable view through which a user can self design one click access to favorite and/or recently viewed documents or collections. Collections are presented in tabbed fashion showing all the portfolios for a specific area. From there sub-menus provide a quick jump to topic lists which link to even deeper granularity with expert analysis. A nice feature here is that Code and/or rules can be presented in split-screen format along with the related analysis.

Searching has all of the features we’ve come to expect. You can search the entire collection of specify only specific areas to be searched. Although the Boolean system is fairly standard BNA includes a wizard style guided search function which will be a nice benefit for the practitioner relatively new to tax research.

The Tax Practice Library is an excellent supplemental service for the practitioner who needs a step-up from the more basic “handbook” approach. Unfortunately it lacks direct integration with any of the major tax compliance programs.

THOMSON REUTERS CHECKPOINT

Being a veteran of two firms that were Checkpoint subscribers and being a former Thomson executive I always feel comfortable slipping into a tax research assignment with my old standby. The Thomson Reuters flagship platform has become synonymous with high-end tax research through much of our profession. Their platform delivers RIA, WG&L, PPC (all Thomson Reuters products) and BNA, the AICPA and a host of regulatory agencies. This impressive array of source material is bolstered by an equally impressive selection of calculators, checklists, lookup tables and some of the best client letters in the business. Many firms like the built in time trackers and larger firms will particularly enjoy the extensive firm management utilities. The entire system is highly integrated with the Microsoft Office suite.

Checkpoint’s web interface is customizable via the “Home” tab. Like other systems the customization provides users a method to set links to the sources they personally use most often. It also gets you quickly to current tax and financial news and finally, to the central search utility. The clean appearing tabs list Newsstand, Research, Tools, Practice Development, CPE, My Folders, Time Tracking, and Help. The secret sauce in Checkpoint’s search system is the tri-step approach. Each search starts with keywords, then steps to source material selection, and concludes with an optional, albeit very helpful, thesaurus utility. I particularly like the newsletter email function which allows users to have the system set to automatically email selected newsletter as they are released. This very nice feature switches the operation from “pull technology” (I go GET something) to “push technology” (the system SENDS something to me). This can be a nice time saver. Other “Tools” include the “Create-a-Chart” (a feature which appears to be modeled after uber-competitor CCH’s “Smart Chart”), as well as a useful assortment of productivity utilities like payroll calculators and sales tax lookups.

Thomson Reuters has deeply integrated Checkpoint into their tax compliance products, UltraTax CS and GoSystem Tax ES. The integration can automatically generates client-specific tax alerts based on legislation or rulings as matched to client tax data. Once you’ve mastered the tricks to eliminating the “noise” the Tax Alert service is an almost sure way to become a hero to your clients.

Checkpoint is matrix priced, based on user count and content selection, and starts at around $1,000. Full service firms will be well served with CheckPoint. UltraTax and GoSystem Tax ES users should strongly consider Checkpoint in order to capitalize on the deep integration available. 

THOMSON REUTERS – PPC TAX eWORKPAPERS and QUICKFINDER

PPC’s Tax eWorkpapers include automatic links from the CD version of their “Deskbook” series of line-by-line form instructions directly into sister tax compliance product UltraTax CS. The e-Practice Aids and Tax e-Workpapers include templates, calculations, flowcharts, checklists, formulas, and comparison charts --- all designed with an eye to becoming a sort of “Swiss army knife” of tax utilities.  

The Quickfinder (not to be confused with upstart The Tax Book launched three years ago by the core editors of the original Quickfinder not long after its acquisition by Thomson Reuters) has been a staple in small and mid-sized tax offices since Wilbur Mills chaired the House Ways & Means Committee. It remains just as good and apparently just as popular as ever. It is offered in the familiar black plastic spiral-bound format, on CD and on the web. Over the years the service has grown to include not only the base 1040 but also books titled “Accounting & Bookkeeping”, “All States”, “Depreciation”, “Small Business”, “Tax Planning for Businesses”, “Tax Planning for Individuals”, and “Special Tax Situations”, each or any combination of which can be purchased or subscribed to.

THE TAX BOOK

As mentioned above The Tax Book is a relative newcomer to the research space, but is actually written by long-time veterans. The service started with the 1040 book and has been steadily growing to its current count of 6 products arranged and bundled in 15 different SKUs. The form factor, presentation, topics and arrangement and even writing style remains astonishingly similar to its ancestor offering.

CCH – INTELLICONNECT

On April 2nd CCH launched their self-proclaimed “next generation” research platform called IntelliConnect, replacing the dozen year-old Tax Research Network. I saw initial previews of this product at the CCH User Conference last fall and was impressed with the simple yet very powerful search interface. Based on the crowds around the demo booth at that conference, so were many of the attendees. The new platform was designed using CCH’s “contextual design” process which, according to CCH, involved more than 500 customer interviews and user sessions and thousands of hours with customers.

CCH plans to begin migration in early May, moving subscribers in groups. At sign-on a subscriber will be notified that they are scheduled to move from TRN to IntelliConnect. For a two week period they will be offered a choice prompt and after the two week window they will be required to move in order to access their account. CCH estimated it will take 6 months to migrate all users.

It’s important to note that IntelliConnect is an interface change only and does not in any way change to content. But the change is substantial. When I was offered a chance to test drive IntelliConnect my first thought was “this is Google”. It’s not, but it IS startlingly simple. The first thing a user notices (after the amazingly clean looking home page) is that the default search is “everything”. That’s a significant departure from the professions standard “choose the library, then choose the search terms” approach. The filters employed are the same as those we use every day with commercial search engines like Google and Yahoo. This, combined with a simpler, cleaner home page seems to make users instantly comfortable. I believe IntelliConnect may well mark the end of boring staff training on “how to use our tax research tool”. The system provides for up to six concurrent tabs, keeps track of up to five different searches at one time, and allows for unlimited online storage of retrieved documents with a “build-your-own” folder system. A particularly helpful feature is that the system does not “time out” thus allowing a practitioner to sign on in the morning and keep IntelliConnect open and available all day long. The screen is divided in a unique tri-view mode presenting the search parameters, the document listings and the text of the selected document --- all in a single view. The screen layout allows each researcher to search in their preferred manner -- code, key word, content menu or any combination. Individual customization allows a user to define “all” as a subset of the subscriptions his or her firm has licensed. This methodology lets users take advantage of the “default to all” process while still allowing, for example, a state and local tax expert to eliminate any results from the “International” library --- and vice versa. Finally, the coup d’état ---IntelliConnect, when used in conjunction with CCH’s @Hand product will allow a user to search their licensed CCH content simultaneously with other specified sites. For example one could search IntelliConnect, the IRS.gov site, a state authority site, and a tax specific wiki such as TaxAlmanac.com --- and see all results in a sortable, filterable list.  The newsletter services, including the client-specific “Client Relate” are all available via web, email, or RSS feeds.

While IntelliConnect is a huge step forward the real key to tax research is content, and CCH continues to offer some of the best in the business. A subscriber can choose from a dizzying list of libraries such as Federal Taxes (with options like Current Features, Journals, Explanations and Analysis, Tax Treatises, Primary Sources, Practice Aids, Tax Archives, and Topical Indexes), the U.S. Master Tax Guide, the Tax Research Consultant, Standard Federal Income Tax Reporter, Federal Estate & Gift Tax Reporter, Planning Tools, etc. The new platform does not change CCH’s pricing model which has base pricing of about $600 with modules at around $200 each.

PEER to PEER ASSISTANCE MODELS

My first exposure to a professional centric BBS was in 1986. In each of the 23 years since then I have read (or written!) at least one article claiming that the Internet would be the death knell of paid tax research services. Well --- it ain’t so! Try as they may these services have yet to even dent the established players. That’s not to say there isn’t a lot of good content and valuable resources on the web --- for free. Here are a few:

ADP Accountant Resources

TaxAlmanac.org

1040.com

TaxSites.com 

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