End-of-Year Checklist: 5 Housekeeping Items for Your Tax Prep Business

With so much focus on the new tax law and getting ready for filing season, have you remembered to double check these mundane-yet-utterly-important items for your tax preparation business? Here’s a quick rundown of what should be on your end-of-year checklist: 5 housekeeping items for your tax prep business.

Business Insurance Tax Preparer Checklist

How long has it been since you last reviewed the insurance coverage you have for your business? If your tax preparation business has gone through any changes, you may not have the right coverage for what you need. If you’ve grown, you may need more coverage or different kinds of coverage (such as workers’ compensation). If you’ve scaled back, you may be wasting money paying for more coverage than what you need. There could also be new kinds of coverage that didn’t exist before that may be a good idea to protect you from new threats. For example, do you have Data Breach Insurance?

The four most basic kinds of insurance coverage that nearly every business needs are:

  • Workers’ comp
  • General liability
  • Auto
  • Property and casualty

Then, there are other different insurance policies you may want to add to your business. A few of our favorites include (but are not limited to):

  • Umbrella liability – to protect you against accidents for which your current liability policies don’t cover all the expenses
  • Employee practices liability – to cover you for claims that arise from illegal employee behavior
  • Errors and omissions liability – to protect you from honest errors and oversights that can occur when providing tax services
  • Business interruption – so you can claim compensation for any loss of income should a major event, such as illness, accident, or injury, cause you to have to shut down your business for a while
  • Data breach – because a data breach can cost you hundreds of thousands of dollars by the time you total the damage

The best thing you can do is find an insurance professional you can trust who has experience working with small business owners. Consult with them to determine the best mix of policies for your business.

Data Breach Policy

What is your data breach policy? Do you have it in writing, and do your clients get a copy and have to sign to acknowledge it?

There are two sides to a good data breach policy:

  • The customer-facing policy that exonerates you from liability should a data breach occur
  • The strategy and best practices you follow to do your best to keep a breach from occurring and to limit the damage if/when a breach does occur

You HAVE to follow best practices and have a strong cybersecurity strategy and policy in order to limit your own liability in the event of a data breach.

A good data breach policy has three key components:

  • Protective measures to guard against theft of consumer info in the first place
  • A way to react swiftly when a breach does occur
  • Financial coverage to fix the problem, pay for legal services, and remediate customers, if necessary

Review your current data breach policy, and go over it with a cybersecurity expert. Make sure it covers you and your clients, and make sure you’re following through on all the actions in your plan. Learn more about what the IRS requires here.

IRS Accounts

Are your accounts and certifications with the IRS up-to-date? Is your PTIN renewed? Are your fees paid? Have you met any CE requirements you may have? Make sure everything is in place and ready to roll for the coming filing season.


Have you reviewed what you charge clients for your services? Are your fees competitive? Are they fair to you and actually take into account all the work you do? When was the last time you adjusted your rates? Do you have any new services you need to consider, such as new tax consultations? Take a look at your expenses and make sure your fees are where they need to be to make your business successful. Learn more about how much to charge here.

Marketing Collateral

What kind of marketing collateral have you used in the past? Are all the brochures you pass out and ads you have printed up-to-date? Do you have enough of your printed materials to get through the season?

Do a marketing audit. What marketing efforts have paid off for you in the past? Do passing out brochures and word of mouth referrals get you the business you need? Are other forms of advertising under performing? If some forms of marketing aren’t working as well, can you give them up and allocate that budget to an area that is performing better?

While you’re reviewing your marketing collateral, make sure to take a good look at your website (the ultimate marketing tool) and any customer portals you use, too. Don’t be afraid to find a professional to help you make any important updates you might need. After all, your website is often your first impression, and you want to inspire trust and professionalism in those who visit your site. For a complete guide to tax office marketing, check out our Tax Practice Management Manual.

For more ideas on how to get your office in tip-top shape for tax filing season, check out these articles from The Income Tax School archives.

The Ultimate Marketing Checklist

Plan Now to Make Tax Season Easier for You and Your Clients

3 Best Practices for Setting up Your Own Virtual Tax Preparation Office