Tips - Consolati Tax Prep

Advice for Financial Health

Tax laws change and so do your goals. Knowledge is power.

Consider this a fireside chat, and if you would like to see a specific topic covered, please reach out.

TIPS FOR FINDING A TAX PREPARATION SERVICE

1. Always work with professionals

All paid professional that complete ten or more tax filings are mandated by the IRS to be fingerprinted, submit to a background check and must e-file and electronically sign all tax returns they prepare. Preparers that do not sign or e-file their clients taxes, or promise bigger refunds are breaking the law.

Taxpayers are ultimately responsible for the information on their tax return so always work with credentialed professionals.

2. Organize all relevant tax paperwork

Gather wage and tax statements from employers, bank interest, deductions, etc and send in one complete package. Piece-meal information increases the tax preparation bill as information changes and recalculations need to be made.

3. Reference previous documents provided last year

Things change and this is a good time to see if anything is missing or has changed. As we get to know you we do our best to understand your individual filing from year to year, but this is a good time to review your finances and catch things before submitting. This could be as simple as making sure contact information including phones with voicemail, email addresses and mailing addresses are up-to-date.

4. Separate individual from business accounts

If you are a self-employed business person, you should have a separate bank account for your business. This will help you be organized by keeping business expenses and income separate from your personal expenses. This will not only keep tax preparation more efficient, but also helps you monitor each area without crossover. With clients that have expenses in both areas for business, it adds time in bookkeeping for you, and increases your bill with any tax preparer.

5. Evaluate your withholdings

The goal in your tax year is paying the appropriate amount, no excess in payments or returns. Withholding more gives the government your money in an interest-free loan that you could otherwise invest or use through the year. On the other hand, withholding to little could leave you with a large payment in taxes back to the IRS. Recently there have been significant delays in refunds for customers with large refunds. This is the time to assess and ask for any advice on your withholdings.

6. Filing extension should be the exception, not the solution

Life happens. Bereavement or a sudden life change, extensions might be unavoidable. Filing an extension extends the due date for the tax return for six months and avoids a failure to file penalty until the new due date elapses, but the interest will continue to accrue on any amounts due even if you file an extension.

7. Procrastination is a thief of time

Do not wait until the last minute to drop off your tax paperwork. Tax year comes every year like clockwork. Documents, bills and statements can be placed in a box throughout the year and we suggest choosing a couple days to organize by date and category and you’ll be miles ahead. With that simple move you’re ready to send off to your preparer. At our office, we are a small team and we use every minute of our day dedicated to your filings.

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