Preparing for the 2026 Sunset of the TCJA: What Smart CPA Firms Should Be Doing Now

Main Takeaway

The clock is ticking. When the Tax Cuts and Jobs Act (TCJA) sunsets in 2026, we’ll see sweeping changes to individual tax provisions—higher rates, disappearing deductions, and a wave of client questions. Small CPA firms that act now—by upgrading processes, automating grunt work, and educating clients—will be better positioned to ride the wave rather than scramble in its wake.

Let’s talk about what that action plan should look like.

A Quick Glance at What’s Changing

1. Streamline Data Intake Before the Surge Hits

Why it matters:
We’ve all seen what messy data can do—errors, rework, lost time. Clean, organized intake sets the stage for accurate preparation and allows your team to focus on higher-value conversations.

Steps to take:

• Roll out a secure client portal like Canopy or SmartVault—say goodbye to email attachments.

• Build standardized checklists by entity and form type. A W-2 client is not a K-1 client.

• Pre-season surveys are a no-brainer. Catch life changes early—such as kids, property sales, and new LLCs.

Action item:
Run a portal pilot with 10–20 clients this fall. Learn, tweak, and scale by Q1 2026.

2. Automate 1099 and K-1 Processing

What we’re seeing:
Manual entry is still eating hours and triggering preventable IRS notices. Automation here isn’t just efficiency—it’s protection.

Tools to explore:

• 1099s: Use Drake, Tax1099, or Track1099 for e-filing and API integrations.

• K-1s: Look for software like Lacerte or ProConnect that pulls figures from QuickBooks or Xero.

Action item:
Evaluate and shortlist vendors by the end of Q3 2025. Start side-by-side testing early.

3. Build Bulletproof Review Checklists

What’s at risk:
Schedule Cs are especially prone to errors—missed income, fuzzy deductions, or missing logs. A standardized review process turns risk into routine.

Your checklist should cover:

• Entity info: SSNs, EINs, correct filing status

• Income matching: Line up 1099s, deposits, and reported revenue

• Deductions: Validate business mileage, home office claims, M&E eligibility

Action item:
Train your team on digital checklists (e.g., Karbon, FirmFlow) and build supervisor sign-offs into your review workflow.

4. Get Proactive With Client Communication

Let’s be honest: the last-minute document chases and weekend panic emails aren’t sustainable. Steady, proactive engagement makes tax season smoother for everyone.

Ideas that work:

• Quarterly touchpoints: Just 15 minutes can catch missed updates or planning needs

• Webinars: Think bite-sized—TCJA sunset highlights, deduction shifts, planning tips

• Automated nudges: CRM tools like Karbon or Practice Ignition can handle this for you

Action item:
Launch a "TCJA Sunset Brief" webinar series in Q4 2025. Make signup part of your portal flow.

5. Invest in Tech That Frees Up Your Team

The tech stack you build now determines your firm’s capacity in 2026. Choose wisely—and think ROI, not just features.

What to prioritize:

• E-filing: Tools like Drake or UltraTax that support multi-state filings and include built-in error checks

• Document management: Cloud-based DMS with audit trails (Canopy, eFileCabinet)

• Workflow tools: Assign tasks, track deadlines, and identify bottlenecks (Jetpack Workflow, Karbon)

Action item:
Do a six-month ROI review on manual processes. Use the savings to fund smarter tools.

6. Stay Ahead of IRS Changes

Staying current with the IRS isn’t optional. Build it into your firm's rhythm—don’t leave it to last-minute Google searches.

Make it easy:

• Block off one workday per quarter for a tax team process review

• Subscribe to IRS e-news—yes, they’re dry, but they matter

• Maintain a master tax calendar that includes firm-specific and local compliance dates

Action item:
Designate a “Regulatory Watch” lead to share highlights and flag changes that require workflow tweaks.

Final Thoughts

The 2026 TCJA sunset is a test—but it’s also a window of opportunity. Firms that use this time to modernize, automate, and better serve clients will stand out when the dust settles.

This isn’t about scrambling to catch up in January 2026. It’s about laying the groundwork now—so your team’s ready, your clients are informed, and your firm is positioned as the trusted guide through the chaos.

Quick FAQ

What is the TCJA sunset?
Most of the individual tax changes under the 2017 Tax Cuts and Jobs Act expire after 2025. Without action from Congress, we’re going back to pre-2018 rules.

How can small firms manage rising client expectations?
Set up consistent communication touchpoints—automated reminders, quarterly reviews, and simple educational content go a long way.

What tools help automate tax workflows?
Start with integrated e-filing (Drake, UltraTax), cloud DMS (Canopy, SmartVault), and workflow systems (Karbon, Jetpack Workflow).

How often should we check IRS updates?
At least quarterly—and weekly during busy season. Block calendar time, subscribe to alerts, and review processes as a team.