For the US CPA firms tax season often feels like a race against time. With ever-looming deadlines, constantly changing client demands, piling document backlogs, stringent compliance requirements, and the omnipresent staffing shortages – all these leave CPA firms scrambling to make the most out of the tax season. While there have always been solutions to these problems in the form of proactive planning and optimized workflows, nothing has worked as seamlessly as outsourcing. That is why more and more CPA firms choose to outsource tax preparation in the USA to seasoned tax prep experts with outsourcing service providers, especially offshore ones.
However, if you are planning to outsource tax prep, it might be too late for you now. The best time to begin outsourcing your tax prep services is not exactly the tax season — it is before it. To be very precise, the time between July and January is the golden window for offloading tax prep functions and getting your firm ready for the upcoming rush.
In our latest blog titled – Why July–January Is the Ideal Time to Start Outsourcing Tax Prep – we will cover the key business benefits of outsourcing tax prep ahead of the tax season and will chart down a roadmap for CPA firms that are planning to outsource their tax prep.
Understanding the Tax Prep Outsourcing Timeline
While outsourcing might seem like a plug-and-play solution, it actually requires rigorous planning and preparation from your end too. Thus, it is highly advised to start your preparation as early as January or even before. Advanced planning will protect you from unwanted on-boarding delays, workflow misalignment, and untrained external teams.
To make it easy for you, here is a basic overview of the tax preparation outsourcing timeline for CPA firms in the USA:
July–August
September–October
November–December
January
Why July to January Makes Strategic Sense?
While the CPA firms in the US certainly begin outsourcing at different times, the ideal time to outsource your tax prep is July and no later than January.
Here are a few factors that make this period work best:
- Availability of Time & Resources: For most US firms, summer to early winter is comparatively a calmer period. It allows them to seamlessly allocate time to assess tax outsourcing vendors, pilot services, and on-board outsourcing service providers.
- Avoids Peak Season Panic: By starting late, around February or March, as a CPA firm you might find yourself in chaos. By then, for both internal teams and outsourcing partners it is too late and things can get overwhelming.
- Better Pricing & Capacity: During off-season offshoring accounting, services are also looking to collaborate with as many clients as they can and hence they offer better rates and assure capacity. This helps CPA firm’s lock in their preferred time slots.
- Strong Client Impressions: By collaborating early, clients can see seamless service and quick turnaround times during tax season; as a result, you can build trust and credibility.
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Book Your Free TrialPlanning your tax preparation outsourcing during the July to January period offers a host of benefits. Some of the noteworthy benefits include:
- Time to Build and Train the Offshore Team
Early planning gives ample time to your offshore team to assess and master processes in advance. It gives them sufficient time for training, file simulations, and system testing — resulting in fewer errors and reworks during peak time. - Standardized Processes = Higher Accuracy
Starting early gives you enough time to create SOPs, templates, and workflow documentation, which creates a firm foundation for the peak season. This also eradicates any possible ambiguity, improves efficiency, and ensures compliance. For a comprehensive framework on executing successful outsourcing arrangements—including risk assessment, supervision, client consent, and security controls—CPA firms can follow the AICPA PCPS Outsourcing for CPA Firms Toolkit, which offers actionable, member-backed guidance. - Smoother Technology Integration
Kick-starting your tax preoutsourcing early offers you enough time for secure and smooth integration of tools like QuickBooks, Xero, Drake, UltraTax, or Lacerte, ensuring data integrity and compliance with U.S. standards. - Scalability & Flexibility
Advanced capacity planning enables smooth onboarding for scalable staffing models without frantic last-minute hiring or skyrocketing staffing costs. - Stress-Free Client Management
When you outsource your tax prep work you give your in-house team enough time to focus on client communication, advisory, and relationship building — increasing long-term client value.
While for most of the CPA firms outsourcing is all about reducing cost, in reality though, offshoring offers a lot more. If done properly, offshoring helps CPA firms create capacity without compromising quality. However, in order to make the most of your offshoring engagement timing has to be the key. Here is why:
- Offshoring in advance helps CPA firms train and hire resources best suited to their firms’ need
- Advanced planning helps you stay on top of the regulatory U.S. tax laws, forms, and schedules ahead of the tax season
- It enables you to learn your templates, and preferences, and review systems
- Finally, it allows you to customize communication cadences based on time zones
With enough time in hand to plan your outsourcing move, offshoring gives a strategic advantage and not just cost benefits.
The most profitable CPA firms are not the ones do a lot of work during peak season. They actually are the firms that actually plan your season in advance. The period between July and January, is the one when most U.S.-based CPA firms actually plan their outsourcing tax preparation initiatives. It enables them to identify reliable partners, offshore or otherwise, list the tasks that can be outsourced, and stay atop the evolving regulatory requirements. If you are looking to outsource your tax prep during off-season period, you must capitalize on the July to January period and enjoy the fruits of your labour during the peak season. If you are looking to partner with a seasoned outsourcing tax prep service provider write in to us at marketing@datamaticsbpm.com. The “right time” to start outsourcing is now.
Why is July to January the best time to start outsourcing tax preparation?
This window allows CPA firms to select the right vendor; on board the external team, test workflows, and train staff well before the busy tax season begins. It ensures smooth, error-free operations and stress-free client management during peak periods.
What are the benefits of starting tax outsourcing before the busy season?
Starting early offers benefits like better vendor availability, lower pricing, sufficient training time, seamless technology integration, and robust process documentation — all of which boost efficiency and reduce errors during the high-pressure tax season.
Can small CPA firms benefit from outsourcing tax prep during this time?
Absolutely. In fact, small CPA firms often benefit the most. Outsourcing helps; them scale up without hiring full-time staff, maintain quality, and handle more clients — all while keeping overhead costs low.
