IRS processing delays can crush your tax practice's momentum. Clients get frustrated, cash flow slows, and your reputation takes a hit. The good news? You don't have to sit around waiting for the IRS to catch up.
Here are 10 practical ERO service alternatives that successful tax professionals use to keep their operations running smoothly.
1. Partner with Multiple Software Providers
Don't put all your eggs in one basket. Working with multiple tax software providers gives you backup options when one system experiences delays.
Top options to consider:
- Intuit ProConnect
- Drake Tax
- TaxSlayer Pro
- TaxWise
- ATX
Each provider has different submission windows and server capacities. When one gets bogged down, you can switch to another.
2. Direct Transmitter Services
Instead of going through traditional ERO channels, consider becoming a direct transmitter or partnering with one. Direct transmitters submit returns straight to the IRS without intermediaries.
Benefits:
- Faster processing times
- Better error handling
- Real-time status updates
- Lower rejection rates
Requirements:
- IRS approval process
- Technical infrastructure
- Security compliance
- Annual testing
3. Regional Tax Networks
Join regional tax preparation networks that pool resources and share processing loads. These networks often have established relationships with multiple EROs and can route your returns through less congested channels.
Popular networks:
- Liberty Tax franchises
- Jackson Hewitt affiliate programs
- H&R Block independent contractor programs
- Regional CPA networks
4. Cloud-Based Processing Solutions
Cloud platforms can automatically route returns through the fastest available channels. They monitor IRS processing times and switch between EROs in real-time.
Key features to look for:
- Automatic failover systems
- Load balancing across multiple EROs
- Real-time status monitoring
- Batch processing capabilities
5. Outsourced Preparation Services
When internal processing gets backed up, outsourcing can keep returns moving. Professional outsourcing services have their own ERO relationships and processing infrastructure.
Services include:
- Data entry and preparation
- Review and quality control
- Electronic filing
- Client communication
Cost: Typically $15-50 per return depending on complexity.
6. State-Specific ERO Services
Some states have their own electronic filing systems that process faster than federal returns. Filing state returns separately can speed up refunds and improve client satisfaction.
States with independent systems:
- California (CalFile)
- New York (ProFile)
- Texas (WebFile)
- Florida (F-1040)
7. Bank Product Partnerships
Team up with financial institutions that offer refund advance products. These partnerships can provide immediate client relief while you wait for IRS processing.
Popular bank partners:
- Republic Bank
- TPG Bank
- MetaBank
- Sunrise Bank
Products offered:
- Refund advances ($250-$6,000)
- Same-day funding
- Fee-based revenue sharing
8. Third-Party Aggregators
Aggregator services collect returns from multiple preparers and submit them through high-capacity ERO systems. They often have better relationships with the IRS and faster processing agreements.
How it works:
- You prepare returns normally
- Submit to aggregator platform
- They handle ERO submission
- You receive confirmation and tracking
Fees: Usually 1-3% of preparation fee or flat rate per return.
9. Professional Service Bureaus
Tax service bureaus specialize in high-volume processing and have dedicated ERO infrastructure designed for peak season loads.
Services provided:
- Electronic filing
- Error correction
- Rejection handling
- Status tracking
- Client notifications
Best for: Practices preparing 1,000+ returns annually.
10. Backup Paper Filing Systems
While slower than electronic filing, paper returns can be a lifeline during severe electronic delays. Set up streamlined paper processing for urgent situations.
Paper filing checklist:
- Pre-printed forms inventory
- Certified mail procedures
- Client signature processes
- Delivery confirmation systems
Quick Implementation Checklist
Week 1:
- Research alternative ERO providers
- Contact current software vendor about backup options
- Evaluate regional network opportunities
Week 2:
- Set up accounts with 2-3 alternative providers
- Test submission processes
- Train staff on new procedures
Week 3:
- Implement monitoring systems
- Create client communication templates
- Establish escalation procedures
Ongoing:
- Monitor processing times weekly
- Review ERO performance monthly
- Update backup procedures annually
Cost-Benefit Analysis
Investment required:
- Software licenses: $200-$1,000 per provider
- Setup fees: $100-$500 per ERO
- Training time: 5-10 hours per provider
- Monthly monitoring: 2-3 hours
Potential savings:
- Reduced client complaints
- Faster cash flow
- Increased referrals
- Protected reputation
- Competitive advantage
Monitoring Your Success
Track these metrics to measure improvement:
- Average processing time
- Rejection rates
- Client satisfaction scores
- Return volume capacity
- Revenue per return
Most successful practices see 20-30% faster processing times and 15% fewer client complaints after implementing backup ERO systems.
Next Steps
Start with one or two alternatives that match your practice size and budget. Test them during slow periods before peak season hits. Build relationships with your new ERO contacts so you have direct lines of communication when problems arise.
The key is preparation. Don't wait for delays to find alternatives. Set up your backup systems now so you're ready when the next processing crunch hits.
Remember: your clients don't care about IRS delays. They want their refunds processed quickly and their questions answered promptly. Having multiple ERO options ensures you can deliver on both expectations, regardless of what challenges the tax season brings.