Updated
The review is your job. The sorting usually shouldn't be. But in January, the person who used to do the sorting has moved on, the job post has been up for six weeks, and the shoeboxes are already arriving. This is a look at the options, what each one costs you in control and risk, and the questions to ask before you hand anyone client data.
Why is it so hard to find bookkeepers before tax season?
Partly because the role is shrinking and churning at the same time. The US Bureau of Labor Statistics projects employment of bookkeeping, accounting and auditing clerks to decline 6% from 2025 to 2035, and says technological change is expected to reduce demand. It still projects about 144,100 openings a year, all from replacing people who move to other occupations or leave the labor force. For accountants and auditors, BLS projects 5% growth over the same decade and about 115,300 openings a year.
Read together: there is steady turnover, experienced people are in demand, and everyone is hiring for the same few months. A seasonal posting in January competes with every other firm's.
What are my options for bookkeeping capacity?
Five, and they combine:
- Hire in-house: full-time, part-time or seasonal staff working in your systems
- Outsource to a US provider: a bookkeeping firm or independent bookkeeper doing work for your clients under contract
- Offshore or white-label teams: a provider, often outside the US, working under your firm's name
- Client-side tools: software the client uses to gather and organize their own statements and receipts
- Narrow the scope: decide which clients need full, reconciled books and which need organized expense support only
An extension is not on the list: it moves the deadline rather than adding hours. Our comparison of client expense prep options covers it.
How do the options compare?
These are general tendencies, not quotes; your providers and clients will vary.
| Option | Cost | Control | Data security | Quality | Ramp-up |
|---|---|---|---|---|---|
| In-house hire | Highest fixed cost | Full | Inside your WISP | You train it | Slow: hire and train |
| US outsourced provider | Variable, per client or hour | Shared; set by contract | Depends on provider; vet it | Varies by provider | Medium |
| Offshore or white-label | Often lower hourly cost | Shared; time zones matter | Cross-border; §7216 consent, SSN limits | Varies widely; review needed | Medium |
| Client-side tools | Varies | Client gathers; you review | Depends on the tool; ask where data is stored | Client-dependent | Depends on client adoption |
| Narrow the scope | Varies | Full | No new exposure | Higher: focus where it matters | Immediate |
Which clients actually need full bookkeeping?
A quick triage:
| Client profile | What they need from you |
|---|---|
| Payroll, inventory, loans or financed assets | Full, reconciled books |
| Partnership or S corporation, several entities | Full books, including the balance sheet |
| Accrual basis, or lenders or investors who want financial statements | Full books |
| Cash-basis Schedule C, one or two accounts, no employees | Complete statements, income forms and a documented expense list |
| W-2 earner with a small side business | Statements for the business account and receipts for larger expenses |
The last two groups are where the shoeboxes come from, and they're also the clients who can do the organizing themselves if you tell them exactly what to provide. See the shoebox client guide and getting clients to send documents on time.
What does §7216 say about outsourcing?
It depends on whether the information is tax return information and where the provider is. Section 7216 makes it a crime for a preparer to knowingly or recklessly disclose or use information furnished for, or in connection with, preparing a return, except as the regulations allow. What the regulations say, in short:
- Within the US, assisting with preparation: §301.7216-2(d)(1) lets you disclose to another tax return preparer located in the United States, so long as the services are not substantive determinations. Substantive determinations need the taxpayer's prior written consent under §301.7216-3.
- Contractors for software and systems: §301.7216-2(d)(2) allows disclosure to a contractor working on your equipment or software, only to the extent needed, and you must give them written notice that §§6713 and 7216 apply to them.
- Outside the US: §301.7216-3 requires written consent before disclosure to a tax return preparer located outside the United States. For Form 1040 filers, a US preparer generally may not obtain consent to disclose the taxpayer's SSN abroad and must redact or mask it first, unless an adequate data protection safeguard the IRS has defined is in place and the consent says so.
- Consent format: the IRS Section 7216 Information Center points to Rev. Proc. 2013-14.
Whether month-to-month bookkeeping data counts as tax return information depends on facts and timing. Treat that as a question for your counsel, not something to infer from a provider's sales page.
Separately, the IRS reminded tax professionals in August 2026 that federal law requires a Written Information Security Plan, and that the FTC requirements include selecting service providers that can maintain appropriate safeguards and requiring it in their contracts. An outsourcing contract is part of your WISP.
AICPA members: the Code's Confidential Client Information Rule (ET 1.700.040) also addresses disclosure to third-party service providers. §7216 and that rule both govern sharing client information with outside providers; check how they apply to your firm, along with your state board's rule, with your own counsel or professional body.
What should I ask an outsourcing provider?
- Where are the people who will see client data located? All of them, including backup and QA staff?
- Will any client data, including SSNs, leave the United States? How do you support our §7216 consent and SSN-masking process?
- Will you sign a confidentiality agreement that meets AICPA ET 1.700.040?
- Will you sign a contract requiring you to maintain safeguards consistent with our WISP? Can we see your security program summary?
- How is client data stored, encrypted and deleted at the end of the engagement?
- Do you work in our software and our client files, or do you copy data into your own systems?
- Who reviews the work before it comes back, and what's your error-correction policy?
- What's your turnaround in February and March, not in July?
- Do you subcontract any of the work? To whom?
- Will you work white-label? How do you handle client contact?
- Can we start with two or three clients as a trial before the season?
Where Reapt fits
Reapt belongs in the client-side row, and only for the bottom two groups of the triage table: their expenses arrive organized and explained, every number traced back to its source, and the judgement stays yours. It keeps no books, so payroll and inventory clients still need a bookkeeper; see an alternative to outsourced bookkeeping.