How Tax Guard Lends TAB Bank A Helping Hand Published October 3, 2023
TAB Bank Needed An Assist
Since 1998, TAB Bank’s invoice factoring services have transformed how trucking businesses access working capital.
TAB Bank was utilizing an internal process for managing IRS 8821 forms, collecting IRS information on prospective clients, and ongoing credit monitoring. Managing all of these activities internally generated two key issues for TAB.
Tag-Teaming Form 8821
The first issue was the time delay when submitting 8821 forms for prospective clients. “Time is of the essence when you’re trying to fund someone with a cash flow problem,” said Curtis Sutherland, TAB Bank’s Vice President of Factoring. “We would manually submit the form and often wait up to a week for the IRS to accept our form and respond.”
TAB Bank first called on Tax Guard to help with its form management process. While TAB Bank usually had to wait a week to get a response from the IRS after submitting form 8821, with the help of Tax Guard, TAB Bank was quickly getting 24-hour turnaround times. And instead of having an analyst spend precious time parsing raw data, they can now rely on Tax Guard’s IRS expertise and data-backed insights.
Tax Guard provides ongoing access to federal payroll tax data, along with other revelatory federal tax transcript data that is a far more reliable indicator of small business health than just publicly filed liens. With Tax Guard, TAB Bank can now access up to 10 years of client federal tax compliance history and find telling information, including missing tax returns, tax deposit verification, and outstanding federal tax debt and lien filings.
“If a customer stops paying their taxes, we are going to find out about it the following month. If it’s something more important like a lien, we will find out even sooner,” said Mr. Sutherland.
Doubling Down on Data Overload
TAB Bank also needed deeper IRS expertise throughout its factoring process, assessing and interpreting the data provided through Tax Guard.
“Once we received the IRS reports, an analyst would have to go through the raw data,” said Mr. Sutherland. “We aren’t IRS experts, we’re lenders. So the time our analysts would spend, sometimes determining incorrect results, was a big waste.”
By integrating Tax Guard into its approval process, TAB Bank has improved its efficiency in weeding through tricky IRS data and approving otherwise overlooked deals, ultimately boosting profitability.
“With Tax Guard we can decline clients faster who we cannot fund rather than wasting resources on those deals. It also lets us close more deals because we are more responsive to the customer and can meet aggressive deadlines,” Mr. Sutherland said. He estimates that TAB Bank has been able to close 10-15% more deals per year thanks to Tax Guard.
The benefits to TAB Bank’s bottom line don’t end there. TAB used to have a full-time employee handling tax monitoring and data from 8821s, but these capabilities are now fully managed by Tax Guard, helping to cut costs. Instead of handling client credit monitoring in-house, TAB Bank benefits from Tax Guard’s ongoing borrower monitoring capabilities, including monthly reports and notification alerts. Thanks to Tax Guard, TAB Bank can focus on what they do best—banking.
