Millennials’ Impact on Tax Practice

Millennials’ Impact on Tax Practice

The Growth of Millennials as Tax Clients

Headlines these days seem to love to focus on Millennials, the generation of young adults born roughly between 1981 and 1996. Whether it’s the new cultural trends, the effect they have on markets or otherwise, one thing remains inherently true. Millennials are becoming an increasingly important and large part of the American workforce. With that shift into adulthood, Millennials are also accounting for a larger portion of the base of taxpayers across the United States. Their impact is not just restricted to avocado toast or iPhones. They are now a significant portion of tax clients and tax practices are recognizing the need to adjust to them.

Access to Information

Don’t let anyone tell you that Millennials are lazy or uninformed, as this is the first generation to grow up with Wikipedia, Google, and the rest of the Internet available to them. Whereas their parents might have always needed to hire direct tax experts for all their needs because that was the only option other than being a tax expert themselves, Millennials intuitively research any questions they have. That means that when they come to you as a tax client, they are likely already informed on basics and might have more complex or nuanced questions about what they’ve learned themselves. This access to information makes them more empowered, so be ready to answer new types of questions.

Different Economic Priorities

Compared with previous generations, the financial situation of Millennials looks rather different than others at their age. Rising college tuition costs have led to trillions of dollars in collective debt that weigh on Millennials as their financial burden. Such debts make it more difficult for them to own property or invest in many traditional ways. On top of that, their view of the workforce is altered—they may have multiple jobs, operate as freelancers, or participate in the gig economy. This means the tax needs and obligations of Millennials are likely different than what you were seeing from clients in previous decades. This is the new norm, so be ready for some unique situations to tackle for the taxes of Millennials.

Technology, Technology, Technology

Once again, technology is something Millennials grew up with and are fluent in handling. That means they are most comfortable interacting with technology and using solutions for taxes with which their elders may have been less in tune. They’ve probably used tax software to complete their taxes in the past. They might find tax consultants via social media or general internet searches. They want to track their financial information digitally, rather than on paper. And it’s possible they’re happy to converse with a tax professional via text or online chat, rather than in person.

The times are changing and Millennials are leading the way. Treating them like the generations that came before them is short-sighted, so recognize the ways in which Millennials are impacting the tax industry and stay ahead of the curve!