Tax Preparation – Page 2

Hints and Questions to Consider when Choosing a Tax Advisor

Last week, we took a look at factors that go into choosing a tax advisor and what your business should be getting out of this tax advisor. You can read more about this here. Now that you know what you should be looking for and what benefits should come out of having a tax advisor, it is time to take a closer look at the process of actually securing a tax advisor for your business during the hiring process. Beck and Company’s Certified Public Accountants and Business Advisors are experienced and qualified to help your business with their tax preparation and can offer further advice on securing a tax advisor as well. We provide innovative tax compliance and consulting solutions in addition to tax planning and preparation assistance. We have certified public accountants (CPAs) who can help. Learn more about our tax service offerings here.

Whether you choose a Beck and Company CPA or someone else to be your tax advisor, the following hints should be at the forefront of your mind when choosing the right tax preparer or advisor to do your taxes. Finding an advisor who is truly committed to your business success is absolutely paramount. Selecting the right advisor should be a process not unlike selecting a full-time employee who’s the right fit for your business. These hints will help you to secure the right person with the right intentions which will ultimately save you from major headaches down the road. With that in mind, consider the following hints.

Helpful Hints When Choosing a Tax Preparer/ Advisor

Use a reputable tax professional who signs the tax return and provides a copy.
Consider whether the individual or firm will be around to answer questions about the preparation of the tax return months, or even years, after the return has been filed.
Check the person’s credentials. Only attorneys, CPAs, and enrolled agents can represent taxpayers before the IRS in all matters, including audits, collection, and appeals. Other return preparers may only represent taxpayers for audits of returns they actually prepared.
Find out if the preparer is affiliated with a professional organization that provides its members with continuing education and resources that also holds them to a code of ethics.
Be cautious of tax preparers who claim they can obtain larger refunds than other preparers.

These hints alone are not sufficient. You will want to be sure to interact with and communicate with three or four options in tax advisors before making your final decision. When you interview them, consider the following questions to ask them. Their answers will offer guidance and insight into your ultimate tax advisor final decision. In addition to these guiding questions that are found below, a few key qualities you should discuss during an interview are availability, qualifications and experience, client longevity, and price.

Questions to Ask when Choosing a Tax Advisor

What is the candidate’s educational background? Do they have an advanced degree?
What qualifications does the candidate have?
Do they have expertise in areas relevant to your business?
How long has the candidate been doing tax advising?
Do they have any licenses? If so, which licenses do they have?
Will he or she provide at least three references of current clients?
Have they been cited by any professional or regulatory body for disciplinary reasons?
How and what do they charge? What fees will they charge?
Do they provide ongoing reviews and planning strategies for you?
Will they represent you if you are audited?
Are you comfortable with your prospective accountant/ tax advisor?

The right answer to these questions depends on your individual business’ situation and needs, but what is most important is that you do your homework and make an educated decision when it comes to the important choice in picking a tax advisor. For more information about the process or to find a tax advisor for your business, contact us here at Beck and Company CPAs.

Benefits of and Ways to Choose the Best Tax Advisor

Choosing the right person to be your company’s tax advisor is no easy task. Similar to choosing a good accountant for your overall business needs, you will want a tax advisor who will have the specific characteristics and qualifications you need while also being a good fit in personality and style.

For many small and mid-sized businesses, it is recommended that you do not do your taxes alone but that you consult a certified public accountant (CPA) to be involved in the tax process. This CPA acts as the tax advisor because they can give advice on which tax strategies to take or not to take based on their interpretation of IRS rulings and past experience. There are endless complexities and deductions that can be easily missed without the expertise of a CPA, and they can be vital to long-term strategic planning as well. This means that the CPA is not just communicating at tax time but throughout the year so that there are no surprises at tax time. This includes advising on investment monitoring and keeping current on upcoming tax legislation. Another perk in hiring a CPA as your company’s tax advisor means they will represent you in an audit before the IRS, if needed, so you don’t have to go it alone.

It is important to remember that you are not only paying for tax preparation but also for the advice relationship when using a CPA as a tax advisor. Beck and Company’s Certified Public Accountants and Business Advisors offer tax planning and preparation services if you are in need of a tax advisor or want more information about finding the best one. Learn more about our Tax Consulting Services by visiting here.

What are the key factors that go into choosing a tax advisor?

You can think of this as the “two Cs”: competence and communication.

Competence: Your tax advisor should have tax preparation expertise and be up-to-date on ever-changing tax laws. Be sure that they not only have a solid background with regards to tax expertise but also are competent in realms that match up to your business’ unique industry.
Communication: Even a very skilled and competent tax advisor is not worth your time if they do not communicate regularly or honestly. They are expected to keep you informed so there are no surprises but also to communicate well with you in general. If the right person has the wrong personality or skill set, it will still be the wrong choice for your business. Choose someone that will mesh well with your company and staff.

What should your business be getting out of your tax advisor?

In addition to the qualities and skills that a CPA should provide your business, consider the following parameters so you get the most out of your tax advisor both initially and over the long-term future.

· Write a job description.

Hiring a professional is no different than hiring an employee. Outline specifically what you want them to do.

· Match personalities.

It’s important that your personality and that of the people you engage with are compatible. It’s not unusual for a professional to have a great relationship with one client and not satisfy another. The problem could be a simple personality clash.

· Communicate regularly.

If you dump your whole financial future in the hands of a tax advisor without ongoing communications, you’re asking for trouble. Nobody is going to have as much interest in the financial future of your business as you. Make sure you have a strong line of communication open with your advisor.

· Demand results.

If you don’t like the way they do business or the results they get, fire them and find someone else. Don’t hold on to someone who is not helping to further you company’s success.

Next week, we will take a look at some hints and questions to consider when you are in the process of initially hiring a tax advisor and are hoping to choose the right one. Stay tuned for these important tips. In the meantime, contact us here at Beck and Company CPAs so we can help you with your tax service needs or help you find a great tax advisor for your business.

An Update on 2013 Form 990

Last year, the Internal Revenue Service (IRS) revealed significant changes to the Form 990, resulting in wide-spread confusion among non-profit organizations regarding what they needed to include in the form. Over the past year, our certified public accountants have worked with a variety of non-profit and government organizations to ensure the proper disclosure of financial assets and information. We’ve worked particularly hard at demystifying Form 990 and helping organizations understand the purpose and significance of this form.

In March, the IRS announced more changes to Form 990 and 990-EZ to modify and clarify certain financial reporting requirements. While it may seem like significant changes have been made to the form, the majority of revisions and clarifications have been made to the instructions of the form (rather than the form itself). There aren’t any large-scale changes or additions to the information non-profits have to report on in Form 990. This is good news for non-profits who’ve just had to relearn Form 990!

In an effort to help you understand the changes made to the forms (and their related schedules and instructions), we’ve created a list of the most significant changes below. For a full list, view the changes on the IRS website.

The general instructions clarify that a short period return CANNOT be filed electronically unless the “initial return” or the “final return” box is selected in Item B. As a result, a short period return that results from a change in an organization’s accounting period MUST be paper-filed.
The instructions clarify the specific documentation needed to support a name change, termination, merger, dissolution or revocation of exemption. These documents must be attached to – and filed with – Form 990.
The instructions for Part VII Clarify that directors’ compensation for non-director independent contractor services to the organization and related organizations must be reported in Section A.
Appendix E to the Form 990 instructions has been updated to clarify that the public inspection and disclosure requirements apply to both the original returns and amended returns.

If you are confused about the changes to 2013 Form 990 or would like some assistance filling out the form, contact our CPAs today. Our tax services are designed to help you file all of your non-profit-related forms with peace of mind.

Is Your Small Business Ready for Tax Season?

Tax season is upon us and with it brings a substantial amount of stress, particularly for small business owners. If you’re already stressing about tax season, you’re not alone. Finding the documents and information you need to file your taxes can be challenging, especially if you haven’t been keeping up with your files year-round. Tax laws and deductions change yearly, and you have to research the latest information to ensure you file your taxes accurately. Preparing for tax filing alone is challenging enough; actually filing is a completely separate matter.

We’ve provided several tips to ease the burden of tax preparation and ensure that you make the April 15^th deadline. Keep the following in mind as you prepare for tax season (and remember to practice your deep breathing):

Always keep your personal and business expenses separate.
The IRS keeps a close eye on personal expenses that could be claimed as business expenses (such as using a business vehicle for personal reasons). Protect yourself by maintaining separate bank accounts and credit cards for your personal and business expenses. Keep good records to back up your claims. If the IRS does inquire about a particular expense, you will have the information you need to back it up.
Maintain good financial records year-round and research available deductions.
Proper record-keeping is crucial to ensuring that your taxes are filed accurately. Be diligent about maintaining your records all year so when it comes tax time, you have everything you need to file confidently. Make sure to save all essential paperwork that may be needed to back up deduction claims in case of an audit. Remember that tax credits and deductions change each year, so be sure to stay up to date on the latest information.
Take advantage of the tax credits within the Affordable Care Act.
This credit will cover up to 35% of the health premiums you pay to cover your employees. For the 2014 tax year, this credit will cover up to 50%.
Remember the Small Business Jobs Act Tax Provision.
Make sure you utilize the provisions within The Small Business Jobs Act of 2010. There are over 17 tax provisions designed to decrease the tax burdens for small businesses. While it may take some time to determine what you can claim, it’s worth the money you could save your business.
Avoid common small business audit traps.
It’s important for small businesses to know the red flags that capture the IRS’ attention. Classifying employees as independent contractors, claiming a home office deduction, and claiming large sum miscellaneous deductions are all huge red flags. If you do qualify for these deductions (and your employees are independent contractors), don’t hesitate to claim them. Just make sure that you have the evidence to back up your claims.

If your small business could use some helping preparing your taxes, give us a call today. Our team of experienced small business accountants and CPA’s can help you make sense of tax regulations and avoid audit traps. Take a look at our tax planning and preparation services to learn more about the services we can offer businesses just like yours.

Should You Hire a Tax Preparation Business Consultant?

Does your business prepare and file its own taxes? While preparing and filing your own taxes may seem more logical than hiring out a professional to do it, it may be in your best interest to hire a tax preparation business consultant. As the tax code continues to expand and become even more complicated, business owners are having a hard time understanding new tax laws. That is, if they even have time to read the lengthy tax code.

While the cost of hiring a tax preparation business consultant may seem expensive at first glance, it will actually save your company a substantial amount of time, money, and frustration in the long run. A professional consultant will know the tax laws and regulations that apply to your business and be able to prepare an accurate return for your business. Choosing the right consultant, however, is essential.

The IRS has provided a lengthy list of requirements business owners should use when hiring a tax professional. For your convenience, we have compiled a tax preparation business consultant checklist to assist you in your search for the perfect tax consultant. Keep the following characteristics in mind as you review your tax preparation business consultant options:

Is the consultant licensed? Licensed professionals are the only ones authorized to represent you before the IRS on tax matters (including audits), so make sure your tax preparation business consultant meets the proper licensing requirements. You can view these requirements here.
Do they offer a free consultation? The initial consultation is essentially the “interview”, and it is just as important as hiring a new employee. Remember, you are legally liable for the information on your tax return, so you your tax preparation business consultant with care. Bring a copy of last year’s tax return to the consultation and discuss how your business situation has changed over the year. Clarify your needs during this consultation to see if the consultant can deliver upon your requests.
How will they charge you for their services? Find out as much information as you can about the tax preparer’s fees before you begin your service with him or her. Some consultants will charge for the number of forms (also known as Schedules) filed while others will charge by the hour. Gaining an understanding of these fees beforehand is important so you aren’t blindsided by a high bill months down the road. One good way to gain an understanding of their charges and fees is to ask what they would have charged to complete last year’s tax return.
Will the consultant be available a year from now? It’s important for businesses to be able to contact their tax preparation business consultant about any questions they have regarding their tax return, whether that be months or years later. Make sure your consultant has a stable history before you hire them.
Does the consultant have any complaints filed with the Better Business Bureau? Make sure that you have thoroughly investigated his or her credentials and find out if they have any complaints filed with the Better Business Bureau. If they do have complaints, begin looking for other options.
Does the consultant ask for receipts / more information to determine whether expenses qualify for deductions? A reputable tax preparation business consultant will ask for any and all receipts to determine what expenses qualify for deductions, and they will ask multiple questions to gain a better understanding of your business expenses.
Will your tax return’s preparation be outsourced? This could lead to significant security risks, particularly if your personal information is being transmitted via the Internet. Find out if the consultant will be preparing your tax return his or herself. If not, you may want to look elsewhere. After all, you are paying for the consultant – not the outsourcing service.
What is the consultant’s experience with IRS audit? Ask about their history with the IRS and whether or not they would represent you should your tax return be audited.
Do they have a reimbursement policy in case you end up owing back taxes on a return they prepared? Many reputable tax preparation business consultants have insurance for this particular case.

A tax preparation business consultant is a smart investment if you choose the right person. By using the above tax preparation business consultant checklist, you will be prepared to ask the right questions and – ultimately – hire the right consultant for your business.

If you are looking for a tax preparation consultant, contact us today. Our team consists of Certified Public Accountants (CPAs) and Business Advisors to help your business navigate the complicated tax laws and legislation.