Comprehensive document coverage for 1040 automation

October 2, 2019


Comprehensive source document coverage increases efficiency and productivity in 1040 scan and populate automation.

Technology driven firms looking to increase the efficiency of their 1040 tax return workflow implement a scan and populate solution to automate document organization and data entry into tax software. The efficiency of the scan and populate solution, however, is limited by the number of documents the software recognizes, and the level of detail that’s extracted.  

That’s why a comprehensive document coverage list is one of the 5 Keys to a Successful Scan and Populate Process.

Increase automation with a comprehensive document coverage list

The documents you receive from your clients can be categorized into two types – recognized and unrecognized. Documents that are unrecognized by your scan and populate solution need to be addressed manually. Since most scan and populate solutions can’t recognize or extract data from Federal Organizer Pages, Grantor Letters and State K1s, the data from those documents needs to be manually entered into tax software. That additional data entry results in increased workload compression and a higher chance of human error, even for the most seasoned tax professionals.

A comprehensive document coverage list increases the productivity of scan and populate automation by minimizing human error, increasing standardization, and reducing data entry. After all, if automation is your goal – the more comprehensive the document coverage list, the more documents that will be automated.

Automatically extracting more detail from source documents streamlines your process  

In addition to closely examining the document coverage list of your scan and populate solution, you need to inquire about the level of detail that’s extracted from the source documents.

Most scan and populate packages just read the 1099 summary amounts, like the 1099-DIV summary, and the only detail they read might be the capital gains and losses.

What if your scan and populate solution extracted margin interest, investment fees, and foreign source income so it was reported properly on the 1116 in your tax software?

Your tax staff would spend less time on data entry, and you would remove one more step from your process.

With fewer manual steps, your tax professionals will be focused on the high-value tasks that deserve more careful examination –  not data entry.

Continuously Improving Scan and Populate Efficiency

An efficient scan and populate solution will allow you to automate data entry and establish a fully standardized process. By minimizing unrecognized documents that normally require manual intervention, your tax team can consistently follow the same method for every return, thus generating a rhythm and accelerating the pace of preparation. The improved efficiency at this phase allows your firm to elevate the role that preparers serve in the office. Time that would normally be spent organizing workpapers and keying in source document data is freed up to prepare more returns and focus on providing exceptional client service.

That’s why a comprehensive document coverage list is one of the 5 Keys to Successful Scan and Populate.

1040SCAN automates 3-5 times more documents than the competition, and it’s the only scan and populate system that reads and extracts data from organizer pages, and over 500 consolidated 1099s. Together with TaxCaddy’s automation features, you can automate the retrieval and processing of 2/3 of source documents at your firm. Learn More >>

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