Educate your clients (they’ll thank you with their dollars)

As I’m working my way through this tax season, one of the most striking things I’m learning is that many people lack any inherent understanding of the basics of our tax system.

I take it for granted that people comprehend the most basic ideas behind our tax code: Total income minus deductions equals taxable income which yields tax, credits and payments reduce tax, and the balance is the amount due or refund for the year tax year.

An amazingly large number of taxpayers I’m working with this tax season do not understand this basic concept. People get frustrated because they think their refund should go up because of a deduction, while I sit their not knowing what to say, because I just expect every taxpayer to have a very, very basic idea of how the 1040 system works.

This weekend, I had a customer that gave me medical expenses and employee home office expenses to enter. Since her taxable income was already at zero at this point, there was obviously nothing further to deduct it against, and she was dismayed that her refund didn’t go up.

I had to explain that deductions reduce taxable income, rather than directly increasing her refund. Nobody had ever explained this to her before. We spent several minutes going over the basic model of a 1040, and she left with an understanding of the differences between deductions and credits, thus having a clearer idea of what to look for throughout the year. She was ecstatic that I took the time to explain this to her. Customer for life? You betcha!

Are your clients enriched by interacting with you?

Educate your clients at every opportunity. Not only is this a positioning thing, keeping you firmly on the “right side of the desk”, but it also keeps your clients thinking about you. Top of Mind Awareness (TOMA) is second only to the know/like/trust (KLT) factor with your clients. If they’re thinking about that big deduction they’ve been missing for the past three years, and they’re digging up their records on it, they’re also thinking about YOU. With that, they’re bringing YOU that paperwork to do the amended returns. With those amended returns comes their checkbook.

From your lead generation marketing using special reports to your monthly client newsletter to your social media posts, it’s ALL about educating your clients via every way possible. There is no greater way to market yourself than by educating your clients and prospects. Do this constantly, in every way in which you interact with them.

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