During one of my recent keynotes on The Mobile Marketing Revolution, I discuss many of the industries that have been heavily disrupted (Taxi services, Hotels, Broadcast TV, etc.) or completely decimated (Home Phones, Phone Books, GPS’s, etc.) by mobile technologies. Since we are now coming up on tax season, I added one more industry to the list: Tax Preparation.
Tax preparation in the US is a big business generating around $11 Billion in annual revenues and employing over 300K people. The rapid growth in the US tax code is certainly to blame for this. In 2017, the US tax code contains over 74,000 pages which represents over a 187% increase in just over the past decade alone. And some people continue to wonder why the IRS is as popular as a root canal. In response to this growth, many people now argue for a “flat tax” or a more simplified tax code so people can more easily and efficiently files their taxes. But where Congress is failing in this regard, your smart phone may be helping to resolve this problem for you already.
FILE YOUR TAXES STRAIGHT FROM YOUR SMART PHONE
Did you know that you can file a simple tax form from your smart phone? In 2016 TurboTax decided that of all those pictures you are taking on your smart phone, one of those can be of your W2 tax form that they can then index and use to file your simple tax return within a matter of minutes – all from their App on your smart phone! And how much does this cost you? ZERO – it’s free!
MONKEY SEE MONKEY DO
Due to the explosive growth of online and mobile tax filing, the more traditional tax industry is quickly taking note. Traditional tax filing has largely flat-lined in growth while the self-prepared e-filing industry is seeing 60% growth over the same period of time. Brick and Mortar companies like H&B Block are having to find new ways to keep people coming in the door but as we are now seeing in the retail industry, this is quickly becoming a losing battle. As a result, companies like H&R Block are now adding financial strategy services along with their tax filing services to help consumers make better financial decisions based on the tax information. This is similar to what companies such as Credit Karma have been doing based off of their “free” credit reporting as well. All of these adjunct services are ultimately providing consumers with better financial planning advice while providing “free” tax filing and credit providing services. The result is added revenue streams from credit cards and loan companies who are better serviced through this selection, qualification, and matching process. But will these changes save their brick and mortar operations? Don’t bet on it.
WHY CONSUMERS WIN
The smart phone is the most disruptive technology of our lifetime and is leading to major advancements in our world. Whether it be lives saved by drops in DUI’s as a result of ride sharing Apps such as Uber and Lyft or by consumers now filing their taxes for free in a matter of minutes from their smart phones, consumers are now winning in ways that were unthinkable only decades ago.
So if you still have not yet filed your 2017 taxes or forgot to contact your CPA in time, take a few minutes and download one of these free tax filing Apps and file for yourself and see just how quickly the world is changing for the better…and let somebody else worry about the 74,000 page tax code.