What are Client Letters in ATX Software?

Clear communication is vital for completing tasks accurately and efficiently. When it comes to tax firms, understanding information in the right way is very crucial, as one mistake can hinder your documentation or tax filing task. In order to avoid mistakes, clients and team members must convey their thoughts, concerns, and expectations clearly.

Moreover, effective communication between tax firms and their clients is essential for ensuring all necessary information is obtained for tax preparation. Clear explanations of required documentation help streamline the process, which can be achieved using ATX tax software.

ATX includes key features that help tax firms manage their communication better. One such feature is Client Letters. Using client letters, you can quickly create professional letters that you can send to your clients for various purposes.

In this blog, we’re going to explore what Client Letters are, how they work, and why they’re so useful for tax professionals.

What are Client Letters in ATX Tax Software

In simple terms, Client Letters are professional documents that you can create in ATX software for different purposes, such as requesting documents, sharing tax filing status, important notifications from the IRS, etc., to clients.

ATX has two types of client letters:

• Standard Client Letters: Standard client letters are pre-built templates customized according to the settings saved by the user. Letters can be added to each new return easily.
• Templates: Contrary to Standard Client Letters, Templates contain customizable default content. It also offers a blank template to create any letter from scratch.

You can create any of these client letters in ATX through Communication Manager, which we will explore next.

Also Read: 12 Add-ons for ATX Software That Save Time and Money

Client Communication Manager in ATX

These client letters can be created or customized through the Client Communication Manager. The software includes built-in tools to format letters and design graphics, logos, signatures, tables, and more.

Client Communication Manager offers various formatting options, as in most word processing software, such as bold text, underlined, bullet list, alignment, etc. You can add company logos, tables, and ordered and unordered lists.

The best part is that you can export a template to edit any third-party application such as MS Word, LibreOffice, etc. After editing the template, you can import it into ATX to use it further. Do note that it supports RTF files for importing client letter templates.

From Client Communication Manager preferences, you can enable users to set the combination of required letters in every return upon creation.

One can select the state and federal letters, change paragraphs, and edit other information in the client letters through the Client Communication Manager preferences.

Here are steps to add, modify, and delete each of the letters with the help of these options:

Working With Standard Client Letters

A. Adding Standard Client Letter

Standard client letters can be added automatically and manually to one or more returns.

To add letters automatically:

1. Select the Preferences option either from the Options menu under Return Manager or the Tools menu in Open Return.
2. Select the Client Communication tab.
3. Select the letters that need to be added.
4. Click OK/Apply to apply the changes.

To add letters manually:

• From open return, select the Client Letters option under the Forms menu.
• Select the letters that are to be added to open returns and double-click to open each of them.
• Edit the letter according to the requirement.
• Click the Save button on the toolbar to apply the changes.
• Click the Attach Template button.
• Select the required letters to attach to open returns.
• Click Attach to complete the action.

B. Modifying Standard Client Letters

The following controls can be altered from the settings of Standard client letters and can further be customized once inside the return:

1. Attach a combination of letters to new returns.
2. Combine Client and Estimate letters
3. Include Privacy notice to Client and Estimate letters
4. Integrate State and Federal return letters
5. Determine the pronoun usage (I/we)
6. Include/exclude the required paragraphs

To change the dynamic content of the letter, follow the following steps:

1. Select the desired letter from the open return.
2. Click the Letter Options radio button.
3. Change the choices as required.
4. Click the Preview Letter radio button to get a preview of the result.

C. Deleting Standard Client Letter

To delete the letter from the return:

1. Right-click the client letter from the open return.
2. Select the Discard Form option.
3. Click Discard to delete the letter.

Also Read: How to Remote Access ATX Tax Software

Working With Client Letter Templates

A. Adding Templates

Unlike Standard client letters, templates can only be added manually and not automatically.

To add these templates to open returns, follow the steps mentioned below:

• Under Forms, click Client Letters.
• Select the desired templates and double-click to add or edit them. Template name permits no more than 30 alpha-numeric characters (Special characters are not allowed).
• Click the Save button to save templates in the Client Communication Manager, which can store up to 20 templates.
• From the Tools menu, select Attach letter(s) to Return.
• Select the checkboxes for the required templates.
• Click Attach.
• Close Client Communication Manager.

B. Customizing Templates

Users can customize or create new templates and generate individual client letters easily. Furthermore, one can even modify Master templates that are pre-designed to cover basic tax filing requirements.

These templates include:

• Engagement Letter
• Individual Tax Due
• Individual Refund
• Cover Sheet
• Mailing Slip
• Organizer Letter
• Blank

To customize these templates:

• Click on the Forms menu and select Client Letter in open return.
• Double click the template under the Templates panel.
• In the Editor pane, make the required changes.
• Click Save to apply the changes.
• Select Attach.
• Close Client Communication Manager.

Additionally, these templates can be edited both from inside and outside a return. These can be exported and imported in RTF file format.

You can enhance the functionality of your Templates using Variables in ATX. Moreover, with variables, you can simply do the task-filling task.

Using Variables to Create Custom Templates

To further ease the tax filing task, ATX Tax Software offers the availability of variables. In simple terms, Variables are placeholders in client letter templates. Variables specify which data ATX tax software should fill in the final document.

For example – If you use the [Federal – Taxpayer’s Name] variable in a client letter, ATX will populate the Federal document with the taxpayer’s name.

Variables help extract the required data and show the system where to place it in Standard client letters and Templates. The data inserted varies as per the data entered in the tax return.

There are two types of Variables in ATX:

• Federal 1040
• State

Variables are available to use in all the master templates. You can find a list of variables to use on the right of the Editor Pane.

Also Read: How ATX Cloud Hosting Overcomes Tax Preparers Challenges

How to Add Variables in Client Letters

Follow these simple steps to use variables in your ATX client letters templates:

• Open a return and go to the Forms menu.
• Select Client Letter from the menu. This will bring up the Client Communication Manager.
• In the Templates pane, double-click the template you want to work with. For example, let’s say you choose the Blank Template.
• You’ll see the Blank Template open up. From the Variables pane, drag and drop the variables you need into the template editor.
• You can also add text, graphics, digitized signatures, or tables.
• Arrange everything in the order in which you want them to appear in the letter.
• Once done, click Save As to save your changes as a new letter or template. Remember, this step applies specifically to the Blank template.
• If you’re working on a different template, click Save after adding or editing variables.

Your new template is ready to be attached to returns whenever needed.

Restoring any master template to its default state:

Open the template you want to restore and choose one of the following options:

• Click the Restore button on the toolbar.
• Alternatively, go to the Tools menu and select Restore.
• Or right-click the template you wish to reset, then choose Restore from the menu.

Types of Client Letters You Can Create in ATX Tax Software

You can create the following types of client letters in ATX:

1. Engagement Letters: These letters typically include the terms and conditions of the engagement between the client and the tax firm. It includes details such as the scope of work, fees, and responsibilities of both parties.
2. Tax return summaries: These client letters share summaries of client taxes, including income, deductions, credits, and other relevant information.
3. IRS Correspondence: In these types of client letters, tax firms share inquiries from the IRS, such as audit notifications, tax adjustment notices, etc., to their clients.
4. Payment Reminders: Sharing information with clients about tax deadlines, estimated tax payments, or outstanding balances.
5. Tax Planning Recommendations: Providing clients with recommendations for tax planning strategies based on their financial situation and goals.

Conclusion

Client letters enhance the capability of ATX as they enable tax firms and individuals to send professional client letters to their customers.

Tax firms can quickly generate standard client letters for various purposes, such as sending tax summaries, tax return updates, etc. Thus making it a powerful solution for a seamless tax filing experience.

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