Working With A Tax Preparer
Should I do my own taxes, or hire an accountant?
You know, you're sitting down now, it's getting close to April 15, or at least the first of the year, and you're thinking about taxes. You're deciding "Do I do it myself; do I buy a programme and do it myself on my computer? Do I go and see an accountant or tax preparer? Do I go to the box store that sets up and does a tax return? Or do I go to a CPA?" The question is, how complex do you think your tax return is? If it's a very, very simple tax return; you are a wage earner or you had no itemised deductions, maybe you had a little bit of interest in the bank, then it's simple. You can probably do it yourself and save the money. If it gets a little more complex (you've got wages, maybe you've got interest, and maybe you have a simple piece of rental property) and you're unsure of doing it yourself, then at that point you might want to seek the services of a professional. At what level professional you go see? Do you find just a preparer that has got what I call the box store? You go into their store, you bring the stuff, they do the taxes, and you're gone. Then, you come to the point of seeing that if it's getting more complex, you may want to seek a professional CPA who specializes in taxes. We're here all year. We're constantly dealing with the tax law and the updates. When you're dealing with a complex return, you need a professional who has the ability to handle those complex issues.
What should I look for in a tax preparer?
From my standpoint, and the issue from my own practice, most of my clients come from word of mouth. I suggest if you're looking for a tax preparer that the best thing for you to do would be to talk to some of your friends or relatives who are using a tax professional and ask them if they would recommend you. If they're happy with the person and they're satisfied they're more than willing to recommend you to that individual. Most of my clients came from word of mouth, from recommendations. When you finally do get to that individual, just because they're CPAs or say they're tax professionals still might not be sufficient. You want to set up an appointment, meet with them, see how things go. A lot of working with a CPA is going to be a personality situation. I could be the best CPA in town but if our personalities clash, it isn't going to happen. And I understand that. You should understand that also. You've got to be comfortable with the tax professional because basically you're laying your whole financial life out in front of this individual. If you're uncomfortable with that person, or you get a strange feeling, best you pack up your stuff, go out the door, and go down the hall to the next guy.
How should I prepare for a meeting with my tax preparer?
You made the decision to take your tax return to a tax preparer, how much do you have to prepare? Well, obviously you have to gather all the stuff together because the tax preparer is not going to be sitting in your home. They're not going to be putting all the papers and the receipts and everything together. The more you can prepare prior to the meeting, the better it's going to be, the smoother the appointment is going to go. In most cases, if the appointment goes smooth and you have all your documents put together, the fees are going to be more reasonable. I can tell you from my standpoint if you brought in a big box of receipts and said “Here, do my tax return,” I could do it, but somebody is going to have to go through all those receipts and sort them out before I can even start preparing the return. If you've done it ahead of time, I don't have to do that, the fees are going to be more reasonable.
What should my tax preparer be asking me?
The tax preparer, when you sit down with him, should ultimately be asking all kinds of things of you. If all you wanted was somebody to hand data to, put it on the computer and give you back a tax return, go out and buy your own tax program. You don't need a professional. A professional tax preparer should be looking at the information that you brought to them, asking you probing questions. If you're in this kind of business, my experience is, if you're in a particular business, I would expect to see certain expenses. I don't see them here. Do you have those kinds of expenses? If you don't, not necessarily why don't you, but I would expect to see them. It's very possible that your business is such that you don't have those expenses, but I should be probing you for that information.
