Rising to the Challenge: How Wiss Responded to Historic Tax Legislation
An interview with Michael LaMotta, Partner-in-Charge, Tax Services at Wiss & Co. LLP
On December 22, 2017, the Tax Cuts and Jobs Act was signed into law. It presented the most significant changes to the tax code in over thirty years, and its effects were wide-ranging. Everyone from individual taxpayers and business owners to accountants and financial advisers had to learn the ropes. Now, two years after the bill was passed, many are still playing catch-up.
“When the tax reform was signed into law, it basically changed the bible of tax law,” said Michael LaMotta, Partner-in-Charge of Tax Services at Wiss. “We were waiting on regulations to explain things. We had to figure out what was gospel versus not gospel.” For most of the employees at the company, it was the first major tax change they’d seen, and even those with long careers in the industry were starting from square one. In response, the 40-person tax team at Wiss decided to band together and dive in. “We embraced it,” LaMotta said. “We got in front of the issue.”
The Wiss tax team spent most of 2018 breaking down the new law into digestible pieces and discussing regulations, as well as assigning teams to focus on key aspects. But there was one obstacle they hadn’t anticipated. “When January 2019 rolled around and we began preparation of 2018 tax returns, we had a pretty good idea of what we thought had to happen. Then the software piece kicked in,” LaMotta said. “We didn’t get the results we thought we were going to get. The inconsistencies with the software made January to April very difficult.” Wiss responded to the challenge by manually double-checking their work, which added a great deal of strain to an already time-consuming process.
Even the IRS seemed to be struggling to adapt to the new changes, and the record-breaking 34-day government shutdown that occurred around the beginning of 2019 only added to the chaos. At Wiss, the many tax notices they received turned out to be errors by the IRS. “We would respond to them by saying, no, that’s not what the rule is; this is why we did what we did,” LaMotta explained. With the support structure they’d previously relied on now in question, the future looked uncertain. It would have been easy to cave under the pressure, but instead, the team at Wiss rose to the challenge. “It was a colossal issue, and we did a great job,” LaMotta said. “We taught each other a lot along the way.”
Now, with two years under their belt, the team is taking a proactive approach, talking to clients about what 2020 is going to look like and making their own preparations for the tax season ahead. While the adjustment period continues, LaMotta is focusing on the positive: “We’re in a better place now than we were a year ago.”