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FILING YOUR 2009 INCOME TAX RETURN

This is the time of year many of you have been waiting for. Because most Americans will receive an income tax refund this year, it is a good idea to get organized and make your tax appointment early. Here are a few suggestions that will simplify the process and save you money.

First things first. After you've completed filling out your organizer, your accountant will need certain documents in order to prepare an accurate return. My suggestion is to put the documents requested in the order they appear in the organizer. For example; If the first page of your organizer contains W-2 information, put the W-2's first and so on. This accomplishes two things; 1^st, it will allow those preparers who use a paperless office to scan the organizer and documents making the review process quicker, and 2^nd , it tells them you have spent some time preparing and you read this blog.

It does not really matter how you do it (phone, fax, email, snail mail or in person), the sooner you are able to get your return in the system the more likely you will have it completed early and receive your refund. Because some preparers prefer to extend a certain number of returns, ask when you can expect your return to be completed.

Most professional accounting firms require all clients to sign an engagement letter prior to preparing a tax return. It is a legal contract that stipulates the terms and conditions for which all parties will adhere to. It also is an indication that the firm preparing your return is concerned about quality and wants to make certain everyone is playing by the same rules. Take time to read it, as there may have been changes from prior years.

Find out how your preparer charges for services. While some preparers charge by the form, others base fees on an hourly rate. Either way, it's difficult to determine an exact fee simply because events may have happened during the year (i.e. divorce, marriage, child birth, new home), or changes in the tax law that you can't control (i.e. make work pay credit, or AMT).  So don't expect it to be the same as last year, particularly with the massive tax law changes that occurred in 2009.

Let's face it; we live in a complex world and expecting everything to go smoothly without breaking down is not realistic. Some accounting firms offer other tax related services, such as tax planning, extended maintenance contracts, and consulting services. You constantly here from people that receive letters from the IRS or Minnesota. They process millions of documents and it's not unheard of to expect system errors. For this reason, and others, some preparers are providing maintenance agreements to help clients respond to these situations.

What is your process? How do you protect my information? When can I expect my return to be done? How will my copy look? In the past, everyone received a paper copy. In today world that can come in the form of a CD, pdf file, or stored electronically using a personal online portal.

This tax season plan, be prepared and be patient. Accounting firms have been inundated with massive changes in both the tax and accounting sectors. We will work hard and put in long hours to find every possible credit and deduction that will minimize your tax liability. Our monthly newsletter is one vehicle we use to communicate information to our clients and visitors year-round. If you have any suggestions please email me and I will promptly respond. Enjoy the rest of our website and please call 952-746-3470 with any questions.