Many certified public accountants (CPAs), enrolled agents and other tax preparers and professionals that run accounting and tax preparation firms are constantly looking for new advisory avenues to service clients.

The two major reasons why are clear: Advisory services tend to have a higher margin than compliance services and aren’t restricted to just the tax-filing seasons of spring and fall; and clients seem to always be asking for extra help in various new areas.

One of these new areas, is often sales tax.

Why now?

Compliance work has historically been the bread and butter of accounting firms (no matter how often they complain about the U.S. Tax Code and the IRS).  But increasingly accounting and CPA firms look to expand into advisory services, becoming what the profession has long termed “a trusted advisor.” Such a role can also take a firm beyond the pricing models of flat fees or by-hour into value-added services – potentially a broader, longer-lasting and sometimes more professionally engaging moneymaker.

Accounting firms have long moved into technology, forensics, business management and a host of other biz services. What’s next?

“It has become increasingly clear that there is one tax type in particular that has a direct and constant effect on many of the roughly 31 million small businesses … in this country,” Mark Friedlich, CPA, vice president of U.S. government affairs at Wolters Kluwer Tax & Accounting wrote on Accounting Today. “This is the sales and use tax.

“Typically, your clients already consider you to be their expert in all things tax,” Friedlich told his audience of CPAs and other tax pros. “Many may assume that if you’re not doing sales tax review, compliance and planning for them, they don’t need to worry about it.”

No worries? No knowledge

And that was more than two years ago. Sales tax has only increased in complexity eCommerce businesses since.

In our most recent survey of financial executives’, more than a third (35%) were still trying to figure out how to manage sales tax obligations four years after the Supreme Court’s Wayfair decision.

More than one in 10 (11%) confessed to being unaware of what economic nexus is or its impact on their business – and almost two out of every three (64%) reported being less than fully satisfied with how they currently manage sales tax.

Clearly, between undetected nexus, under-collected and unremitted tax and other details, there’s a lot of room for advisory services in sales and use tax for eCommerce companies.

Our next entry looks at what CPA firms can do to partner with sales and use tax experts to expand into this burgeoning market.

Partnering with an expert allows CPA firms to expand their offerings without having to do the work within the firm. Contact TaxConnex to learn what it means when sales tax is all on us.

Robert Dumas

Written by Robert Dumas

Accountant, consultant and entrepreneur, Robert Dumas began his public accounting career on the tax staff at Arthur Young & Co., followed by a brief stint at Grant Thornton. In 1998, Robert founded Tax Partners, which became the largest sales tax compliance service bureau in the country, and later sold it to Thomson Corporation. Robert founded TaxConnex in 2011 on the principle that the sales tax industry needed more than automation to truly help clients, thus building within TaxConnex a proprietary platform and network of sales tax experts to truly take sales tax off client’s plates.