By now you’ve heard all about it: Technology is changing the way people work. That’s true across all industries and workplaces, whether it’s the floor of a manufacturing facility or the office space of an insurance company.
Property tax management is no exception. Currently, a digital transformation is underway, giving property tax teams new and better ways to provide value to their organizations, become more efficient, and spend less money. It comes at a time when organizations are under increased scrutiny to compete with emerging, often global, competitors. Those teams willing to embrace advanced tax technology tools will be better positioned to meet the challenges that lie ahead.
The Future Of Tax & Technology: Changing The Distribution Of Work
First of all, what is tax technology? Tax technology includes any type of software that supports the digitization of tax processes. When incorporated into the existing workflow of a tax practice, tax technology solutions will generate significant operational efficiencies—and thus advantages—for the tax teams that use them.
Tax and technology go hand-in-hand—but is your team using the right tools to work smarter? Find out about the latest technology helping property tax professionals to get ahead.
Much of property tax revolves around manual, repetitive work, including data entry, data verification, and report generation. When highly paid tax professionals spend time doing data entry work, that leaves less time for activities that deliver greater value, such as managing tax risk, looking for tax reductions, and finding opportunities to appeal unfair assessments. Having alternative, accurate ways to handle data extraction and data entry will be essential for the high-performing tax departments of the future.
Over the next few years, emerging technologies will impact the way property tax is practiced and managed. In fact, the transformation has already begun. Software like TotalPropertyTax (TPT) and MetaTaskerPT are changing the game for tax practitioners, modernizing their processes and helping them become faster and more efficient. Ultimately, digitization will bring the costs of doing business down, and allow teams to generate a higher quality work product in a shorter amount of time.
So what will work look like for a property tax team using advanced technology solutions in 2020?
- Data entry—Instead of extracting data from tax documents manually, they’ll use software that handles it automatically. Using a combination of crowdsourcing and machine learning, advanced tax technology solutions can classify documents and extract the required data from them automatically, uploading it into the tax system quickly and accurately.
- Data validation—Instead of manually checking a list of fixed assets against the information in a general ledger, they’ll use robotic process automation (RPA) to confirm the quality and accuracy of data.
- Asset classification—Instead of manually assigning assets to categories, they’ll use a machine learning application that recognizes asset descriptions and learns how to categorize them correctly, reducing the number of manual reviews that need to be done.
- Tax strategizing—Instead of focusing their efforts on low-value, manual tasks, they’ll spend more time on this area, strategizing about how to lower their organization’s tax liability. They may also take advantage of artificial intelligence applications to help dissect comparable properties’ assessments or transactions.
- Tax forecasting—Instead of relying solely on their own research for forecasting, they’ll use artificial intelligence algorithms to analyze corporate data and detect trends in data for more accurate forecasts.
- Accounting reconciliation—Instead of comparing various data sources manually, they’ll use RPA to compare invoice discrepancies quickly.
- Audits—Instead of manually extracting information from different reports and systems and creating handwritten reports, they’ll use blockchain technology to capture and accumulate the metadata needed for audits. Performing an audit becomes a simple playback of captured data.
- Filing property tax returns—Instead of taking the time to manually fill out tax returns (and risk costly mistakes), they’ll use property tax software to generate returns quickly and accurately. (TotalPropertyTax can generate 500 returns in under 15 minutes!)
- Bill paying—Instead of printing out returns and documents, generating checks, and stuffing envelopes, they’ll use a print-to-mail automation system. Their office is connected directly to a print-and-mail center, which completes their mailings automatically.
- Assessment appeal management—Instead of foregoing appeals, they’ll use advanced tax technology solutions to handle the small stuff, gaining back time for this important activity. They’ll also use property tax software to more easily perform “what if” analysis using different depreciation scales and lifespans for assets, and deconstruct an assessor’s valuation methods.
- Tracking assessments and appeals—Instead of spending valuable time tracking and managing assessments, they’ll use tax software to track missing assessment notices, and create and track appeal information.
Robotic Process Automation: The Programmable Robot
Manual, repetitive tasks like these can be automated thanks to RPA. It’s a type of software that can mimic physical activity tasks—essentially, any type of task that doesn’t require knowledge or human understanding. RPA could be used for a number of property tax processes, including data validation (checking a list of fixed assets against the information in a general ledger, for instance) and data entry (inputting data into a tax return application).
Case studies have shown that organizations using RPA have experienced a return on investment ranging from 30% to 200% in the first year of use. (Tweet this!) But the other benefits are equally important: more time for staff members to focus on activities that provide greater return (like predictive analytics and tax planning), greater accuracy in data handling, and higher levels of job satisfaction among tax teams. RPA also solves the challenges associated with pulling data from various non-integrated systems—a time-consuming, tedious task faced by many organizations.
Want to know more? Find out about other advanced tax technology solutions your property tax team can start using today by downloading our free white paper, The State Of Property Tax Technology: 2018-2020.
Emerging technologies are already impacting all aspects of property tax management, from workers to processes to software solutions. RPA is just one example of using innovation to get ahead, but there are many other opportunities for property tax professionals to work smarter using fewer resources. To read about technology your team can start taking advantage of today, download our free white paper, The State Of Property Tax Technology: 2018-2020.