Tax Preparation Q & A

Answers to commonly asked questions about tax preparation.

Are all “tax professionals” the same?

NO! There is currently no licensing or registration requirement for one to be considered a “tax preparer.” You could hang up a sign and start a tax preparation business. Thus, there is more to consider than merely how much a preparer charges.

Would you prefer an individual who has a degree in accounting or tax combined with experience and professional certification (e.g., CPA) to a preparer who may have only a high school diploma and less than a year’s worth of training and experience in preparing taxes?

A CPA has at least the equivalent of a bachelor’s degree in accounting. He/she has passed the uniform CPA examination (pass rate lower than the BAR exam that attorneys take to become licensed) and must complete a minimum of 40 hours of continuing education in their field to maintain his/her license. Non-licensed accountants who work for CPA firms typically need to meet the same requirements in terms of continuing education.

A CPA or public accountant is more likely to have year-round, full-time hours and will be available when you have tax questions, problems, or concerns.

When you are calling around to get information about tax preparation, please keep in mind that not all preparers are the same. Thus, you should ask questions to determine if the individual who would be preparing your returns has the combination of experience, education, and credentials that meets your expectations. Also, ask about the firm’s availability after tax season as many tax preparation services are seasonal.

When will your firm begin preparing tax returns?

For the tax year just ended, we begin preparing those returns in mid-January and begin electronically filing (e-file) that same day. Please call our office for the exact date. We prepare income tax returns (prior year and previous years) year-round.

Is an appointment required?

Yes, you must have an appointment to have your taxes prepared. We have flexible, extended hours during tax season, to include evening and Saturday appointments.

Do you offer IRS e-file/electronic filing?

Yes! If you have a refund coming, you can have your refund back in as little as 7 –10 days if you elect to have your refund direct deposited into a checking or savings account. It generally takes a week longer if you decide to have a refund check mailed to you.

Why should I e-file my returns?

Speed and accuracy! The processing error rate with Federal returns filed on paper is roughly between 20% and 21% (1 out of every 5 returns filed); the error rate for e-filed returns is believed to be less than 1/2% (1 out of every 200 returns). And, if you are getting a refund, you will get it back quicker!

Do you offer “rapid refund”/refund anticipation loans?

We do not offer these products as the cost of administration of such products is expensive to us and to clients. We strongly encourage standard e-file (electronic filing) with direct deposit as this option allows you to get your refund back in as little as 7 – 10 days.

What do I need for my tax appointment?

We can provide you with what we call a tax organizer to assist you in being better prepared for your tax appointment. We can e-mail, fax, or mail this document to you if you have scheduled a tax appointment. The tax organizer includes a section to record general information, such as names, dates of birth, and social security numbers. It also includes a list of yes/no general questions in regards to items that may affect your tax return and sections by category (other income, self-employed, itemized deductions, etc) that you can use as a checklist in gathering and organizing information needed to prepare your returns. Furthermore, it is full of tax tips!

Also, you may want to review our article Preparing for Tax Preparation which will allow you to be better prepared and organized which in turn helps to minimize tax preparation fees.

How long will it take to have my taxes prepared/how soon will my taxes be ready? What can I expect during the appointment?

Our goal is to complete as many clients’ returns as possible the same day as their tax appointment to include preparing returns while we meet with clients. Many clients’ returns can be completed from start to finish in as little as two hours (less than that for some!). The preparation of more complicated returns may not be able to be completed the same day.

Your preparer will meet with you at least briefly to go over your information with you and ask questions. Next, your preparer will work on your returns and may complete them from start to finish while meeting with you. In some cases, you will be given the choice to wait in our reception area or to step out for a while and come back at a time designated by the preparer. It is recommended that you wait at our office if the wait time is only going to be an hour or less so you will be readily available if the preparer has any follow up questions. Once the returns are completed, the preparer will meet with you at least briefly to go over them with you and answer any questions that you may have.

Want to ensure that your appointment is goes smoothly? Check out our article Preparing for Tax Preparation.

How much will it cost for me to have my taxes prepared?

Tax preparation fees are comprised of hourly and fixed fee components. The primary factor that affects the total cost will be the time taken to prepare the returns. The number of forms and schedules required, the complexity of one’s tax situation, and how organized the client is all affect how long it will take to prepare the returns. Additionally, optional services, such as refund anticipation loans, will also affect total fees.

The following is a general guideline for estimating our total fees for tax preparation:

· $125 to $205 for most basic returns (1 – 2 hours of staff time)

· $205 to $365 for most returns of moderate complexity (2 – 4 hours of staff time)

· $365+ for most returns of greater complexity (more than 4 hours of staff time).

Fees for tax refund bank products are not included in those estimated fee ranges.

Do you offer any guarantee on tax preparation?

We stand behind our work! If we make a mistake whether technical or clerical in nature that results in an increase in your tax liability, we will pay penalties in accordance with the terms noted in our Tax Preparation Services Agreement that we provide to you at the time of your tax appointment. And, we do not charge extra for our “guarantee” like some of the “tax preparation places” do.

Why use a professional to prepare your taxes?

The following are just a few reasons why you may want to consider using a professional to prepare your taxes:

· Experience. A professional prepares taxes for many individuals and businesses all year round. He or she will consider items and areas that you may not think to consider.

· Time savings. For those of you who may spend an entire weekend, a professional may spend only a few hours.

· Peace of mind. Relax and let a professional preparer take care of it for you! No more worrying if you overlooked something, misinterpreted government instructions, etc.

· Maximize deductions and minimize tax – owe less or have a larger refund!

· Tax preparation costs may be deductible for tax purposes for taxpayers who itemize deductions.

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