Micala Ricketts
Micala Ricketts

Whether it’s to save money, increase productivity, or help the environment, many business owners are taking a serious look at going paperless. Going paperless is not that difficult to do and in the long run, it’s certainly better for your tax practice’s bottom line. If you are interested in transforming your company into a paperless tax office, there’s no better time to start.

The cost of office paper waste 

You can save both money and time by becoming a paperless practice. Recent studies show that the average US worker uses 10,000 sheets of paper per year, and as much as 70% of a company’s total waste is in paper. Paper is one of the largest costs for US businesses, with around $120 million spent on printed documents each year. This doesn’t even include any related costs associated with paper and printing, such as toner and equipment maintenance.

Firms that go paperless often see more productivity in their employees and real savings in their office supply budgets. Beyond saving you time and money and enabling efficiency, choosing the green option of going paperless will set your practice apart as environmentally friendly. With both the environment and economics on the line, it’s no wonder that a paperless practice is appealing. 

Steps for going paperless

Once you’ve decided that you want your tax practice to move in a paperless direction, what are the steps for going paperless? 

1. Invest in paperless office software 

There are many choices on the market for software, storage platforms, mobile applications, and more that help facilitate a paperless practice. Most of them utilize e-signature tools, which have been legally binding in the United States since 2000, when the government passed the Electronic Signatures in Global and National Commerce Act (ESIGN). An e-signature is a process where the user types their name as their signature and selects options that show they agree or confirm. However, note that many IRS forms still do not allow e-signatures, so it’s important to know when a more traditional method is required.  

2. Scan in essential documents 

To eliminate the bulk of your paper waste, you must turn all of your paper documents to digital form. This will be quite time-consuming up front as you most likely have a lot of documents that you want to preserve for future access. There are many different brands of scanners, each with certain capabilities and functions. Some firms purchase desktop scanners while others find ones with a sheet feeder are a better fit. Decide which is best for your tax practice and invest in a scanner that meets your needs. As you work your way through your archives, you’ll be able to eliminate the hard copy storage.

3. Shred any old documents 

Once your documents are scanned and stored digitally, you’ll need to eliminate the old documents. Shredding is the safest and most secure way to destroy documents you no longer need but that contain sensitive and private information. For extremely large shredding jobs, you can hire a professional service that will do regular pickups and take care of all the shredding. Just like scanning, shredding everything will be time consuming at first. However, as time goes on you'll only have to shred individual documents as you finish with them.

4. Create a robust digital system for storage

It’s extremely important that your firm has a sound digital storage system. Backing up your files is one of the most important steps in creating a paperless tax office. Do not shred or get rid of any of your documents until you have backed them up. Even though your documents may be secure in digital storage, a computer crash or other malfunction can erase important files. That’s why it’s critical that you have a backup plan in place.  

The most popular way to back up files is via cloud storage services. Just be sure to do your research to find a reputable cloud provider. Canopy provides unlimited cloud storage included in the purchase of the software. Since cloud services are not directly connected to one computer, none of the documents you keep in the cloud will be affected if a computer crashes. Check out our post on cloud security for more information.

Alternatively, you can back up your files on an external hard drive. Because external hard drives are portable storage devices, you can keep your copied information in a physical location completely separate from your computer if you choose. Simply copy your information to the hard drive and keep it in a secure location. 

5. Reduce small paper waste 

There are countless ways of cutting down on paper within your practice, outside of digitizing documents. For example, you can take notes on your computer rather than use notebooks or sticky notes. Canopy enables you to add notes to your cases right in the software—you won't need a separate place for note-keeping.

Another way to cut down on paper is to bill your clients electronically, a feature that clients really love since they can pay with the click of a button. Canopy offers online billing and invoicing to make your life easier and your clients happier.

For more details on how to go paperless with software, check out The Ultimate Guide to Tax Practice Management Software

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