Tax manager career guide

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Your guide to becoming a tax manager

Do you want to build a career that offers you the opportunity to interact with clients, help them achieve their financial goals, and answer complex tax issues and problems they and their business face? Do you want to be a leader and a mentor for your younger or less experienced colleagues as they learn the ropes of the profession? Would you like to have insight into all your clients’ activities and see what they are doing in terms of investments, financial activities, and planning?

If you answer ‘yes’ to these questions, then there is a good chance that a tax manager career could be a suitable option for you. However, the road from this point to becoming a tax manager is long, and – apart from the will to succeed – it takes a lot of hard work, dedication, motivation, and study to get there. Let’s find out what a tax manager is, and what you have to do to become one.

What is a tax manager?

Tax managers hold critical positions in their companies and are responsible for a wide array of duties that vary depending on the size of their organization. The tax manager role can be diverse and rewarding, providing access to leadership positions in their organization.

Tax managers are experienced professionals who manage their company’s tax department and coordinate all its tax-related activities. They ensure that their organization is compliant with all laws and regulations and that the department they lead provides accurate and timely tax services for their organization, its clients, or both.

Tax managers participate in end-of-year reporting and are in charge of everything revolving around tax planning and tax return documentation. They advise their organization’s top management on matters such as risk management and risk mitigation, stay up to date with new tax laws and trends, and evaluate the impact legal changes or new provisions can have over the business.

A tax manager’s checklist:

Ensure that their organization’s business operations are compliant with tax policies, laws and regulations
Manage and coordinate their company’s tax department
Manage and coordinate their company’s tax department
Advise on tax-related matters
Participate in end-of-year reporting

What to expect from a career in tax accounting?

Contrary to popular belief, a career in tax can be pretty dynamic, offering a good balance between customer interaction and actual desk work. As a tax professional, you answer emails, take calls, or meet customers directly to discuss their financial activity. In addition, you research and plan your clients’ tax situation, and work to identify ways to help them pay less tax.

So, if you’re passionate about the world of taxes, you enjoy liaising with people, and like the pressure – and rewards – that come with a leadership role, then a tax manager career may be the right choice for you.

The tax manager career path

The Bureau of Labor Statistics (BLS) states that “employment of financial managers is projected to grow 15% from 2019 to 2029, much faster than the average for all occupations.” Tax managers fall into this growth category, so if your goal is to become one, you are choosing a lucrative profession that is in high demand. The median yearly salary in 2020 for tax managers was $98,180.

As a tax manager, you have access to numerous career options, ranging from coordinating the tax department of a medium-sized business or a large corporation, joining a federal or government agency, being a self-employed individual, or starting your own specialized company.

Skills to be a successful tax manager

There is no specific list of formal requirements that directly qualify you for a tax manager position. If you want to be considered for such a role, you must show extensive experience in the fields of accounting and tax, as well as an impressive mixture of soft and hard skills, abilities, and competencies. Let’s have a closer look at the most important ones.

Tax managers need to understand what they work with, and that is mostly numbers. That is why being comfortable with figures and having the capacity to analyze them is top of the list for skills that tax professionals must possess. Also, having solid mathematical abilities comes hand in hand with having an analytical mindset. That will enable tax managers to correctly evaluate their client’s situations and help them make the right decision or offer proper advice.

Not even the most competent person can know everything, especially in the taxation industry where changes in the tax code happen often and exceptions can quickly become the rule. That is why tax managers must have strong research skills that complement their professional know-how. Knowing how to research complex technical topics and find the correct information are essential abilities in the world of taxation.

The way a person communicates with others is probably the best indicator of whether they can be a good manager. Being able to convey a message clearly and concisely in one-to-one discussions as well as to a larger audience is a feature that every tax manager should have.

Not all clients are familiar with tax jargon, so tax managers should be able to translate technical concepts into a manner that’s appropriate to present to clients and in a way that they can understand. Tax managers need to write compelling emails or deliver effective presentations, so the ability to speak and write well will enable tax managers to motivate their team members and convince their clients.

People in management positions – tax managers included – must have a strategic mind and develop critical thinking to find the best solution in various situations and different business environments.

Also, a good leader can relate to everyone, motivate workers by saying the right words, and always lead by example. True leaders are available for people in their teams, can delegate tasks, as well as pass responsibility to those ready to handle it to help further their strengths.

Change is where growth is made, and people who acknowledge this and accept that adapting to a new reality can bring new opportunities will stand out from their competition. Currently, embracing technology is the only way to move forward in most professions and businesses, and the tax industry makes no exception.

Technology offers outstanding opportunities to innovate, streamline work, eliminate errors, and increase efficiency. Especially in the tax world, it can have a substantial impact on how people work. That is why to be a good tax manager, you need to improve yourself, be passionate about learning new things continuously, and technology should rank high on that list.

Tax managers need to make important decisions on a daily basis. Thus, they must have the capacity to assess the risk associated with all these decisions, know what each of them entails, and minimize or eliminate that risk.

Tax managers must oversee all the documentation prepared by the department they run and control every tax-related action their department takes. This results in many things they have to pay attention to in a day where one small error can do a great deal of harm. That is why a keen eye for detail is an excellent quality that every tax manager should have. 

Integrity is crucial in the business world, especially when you have a high level of visibility over sensitive information such as your clients’ financial information and investment plans. That is why integrity will help tax managers build reliable relationships with clients and consolidate an excellent reputation within their organization. 

Job-specific expertise comes through years of study and work experience in the field. You cannot become a tax manager without a high level of knowledge in accounting, law, business, and taxation. This is probably the most important point on this list, so let’s see how you can gain the specialist know-how to become a tax manager.

Earn a bachelor’s in accounting

Most tax managers start their careers as accountants, so earning a bachelor’s in accounting should be the first step on your education path. This program offers you the body of knowledge necessary to start your career and continue your education.

Earning a bachelor’s degree takes around 4 years or 120 credit hours, and admission criteria generally include having a high-school diploma and being able to prove solid mathematical and writing skills. Prominent institutions ask for strong college admission test results and a score of at least 2.5 in your General Public Assessment (GPA).

Continue your education with a master’s

A master’s degree dives deep into practices and processes, helping you advance your career by standing out from other candidates for a tax manager position. A master’s in accounting program also gives you the chance to go for a specialization, one of them being taxation. Choosing it, you learn local and global taxation processes, techniques, and practices and acquire specialist tax planning competencies, which are essential for a career in tax.

Most universities offer the possibility to choose either a hybrid or an online program, giving you the possibility to work and study at the same time. Thus, earning a master’s in tax offers you the opportunity to apply the knowledge you learn in class at your workplace and accumulate both theoretical and practical experience in the field. Juggling between the 2 is difficult, though, so if you do that, try to be as organized as possible in both environments.

Become a certified public accountant

It usually takes 2 years or 35-40 credit hours to earn your master’s degree and, combined with the credit hours from your bachelor’s program, you should have no problem in qualifying to become a Certified Public Accountant (CPA). Obtaining such a credential is an excellent way to diversify your employment opportunities and set yourself apart from the competition.

Become a certified management accountant

Professionals who seek to obtain a management role in the accounting industry tend to become Certified Management Accountants (CMAs). This certification proves that you have acquired advanced know-how in planning, control, analysis, strategic financial management, and decision-making. You can obtain the CMA certification once you pass the exams organized by the Institute of Management Accountants (IMA).

To qualify for the CMA exam, you need to have significant business and accounting knowledge. IMA requires candidates to hold at least a bachelor’s degree in accounting obtained from an accredited institution.

American Accounting Association (AAA)  Established more than a century ago, the AAA gathers under one roof an extensive community of accountants from all walks of life, including the academic field.  

National Society of Accountants (NSA)  With a core mission of helping tax and accounting professionals further their knowledge, NSA is a society that has been active for 75 years. 

American Institute of Certified Public Accountants (AICPA) – Established in 1887, AICPA is the official body that represents CPAs, developing and grading the CPA certification examination tests at state and national level. 

American Association of Finance and Accounting (AAFA)  Founded in 1978, the AAFA connects accounting organizations, firms, and professionals throughout the United States. 

Association of Chartered Accountants in the United States (ACAUS) – If you are an Associate Chartered Accountant or a Chartered Professional Accountant in the United States, this is the organization representing interests of professionals like you. 

International Federation of Accountants (IFA)  This organization represents accounting professionals in more than 130 countries around the world, acting as a global common ground for networking and best practices in the accounting industry.