When you choose the wrong plumber, what happens? You either don’t get your problem fixed the first time and the guy has to come back – which is a pain. Or, the plumber tracks dirt on your carpet walking in your home and you’ve got to clean up after his mess. Again, a hassle and an inconvenience. In the case of picking a bad mechanic, the wrong guy can screw up your car big time! I actually hate it when this happens. (My guess is we’ve all had some person do something to our car one time in life that turned out to be a royal pain in the tail.) Either we had to spend more money to fix something else with our car or we never got the problem actually resolved or it took SO many trips to the garage to fix our automobile that once the ordeal was over, you’d just as soon walk to work now! Again, these kind of poor choices on our part cost us extra money, time and a lot of aggravation.
But, Choosing The WRONG Tax Professional To Help You File Your Taxes Could Put You In Some Serious Hot WaterWith The IRS!
Let me ask you a question. Would you rather have to call another plumber to come fix your leaky pipes or get a nasty letter from the IRS threatening to freeze your bank account if you don’t pay a large sum of back taxes, including penalties and interest? Yeah, me too. I’d rather call another plumber or make another trip back to the auto mechanic’s garage to fix my car right. But having to deal with the IRS by myself? No thanks! Even if I didn’t owe a ton of back taxes, I still don’t want MY RECORD to show some IRS agent that there has been some discrepancy in the past so RED FLAGS start to fly and more bureaucratic people begin looking through all my past tax filings and current income holdings and basically, taking my social security number and poking around in my private life! (If you think they won’t do this, the wool might have already been pulled over your eyes ...) Just look at the nightly news one night. They can do a lot of things you won’t want them to do. However, if you keep a clean slate (no IRS correspondence with you related to filing your taxes correctly), the opportunities for them to mess with your personal stuff will be limited.
I THINK YOU’LL AGREE WITH ME …. CHOOSING THE RIGHT TAX PROFESSIONAL IS A VERY IMPORTANT DECISION!
With that said, I’d like to share with you The Top 5 Biggest Mistakes Most Taxpayers Make When Choosing A Tax Professional!Big Mistake #1:
Not Choosing An Expert In The Type Of Tax Service YOU Want!Most people know what they want when they are looking for someone to help them. However, in the case of filing a tax return, most folks just assume all accountants, CPA’s or tax preparers are about the same. But just like most other professional services, nothing could be further from the truth. Each tax professional has certain qualifications. And again, people who help taxpayers file taxes for a living have their own strengths and weaknesses. But here is the rub: Too many people don’t match up what they want with the strengths of a paid tax professional. And if you fall into this category, listen closely. First, let’s be clear. What do you want from a tax preparer? From my experience, here are the most common “wants” of regular middle income taxpayers. You want an accurately filed tax return. You want the tax filing process broken down into layman’s terms. You don’t want to hear about someone else’s tax filing scenario. No, you are just interested in your own tax situation -- explained so you can understand. And once you’ve “got it” … you want the tax preparer to give you a heads up about some possibilities in the future to save even more money or qualify for other deductions that would legally add more money to your pocket at tax time. You want assurances everything your tax preparer is doing for you is valid and correct, so a guarantee(s) is essential to the process. And of course, you want to “close the book” on this year’s tax filing in a reasonable amount of time. No dragging this process out for many days or weeks. You want to know what’s going on with your taxes in a day or two, gather more info (if needed) which might reduce your tax burden and/or increase the amount of refund money Uncle Sam owes you – and then file your taxes so you can be done with it!
Oh, and if you ARE getting a refund, you want a tax firm who can get you the most money back the fastest … with the most electronic filing options available.
Bottom line: You want accuracy … you want clarity … you want to be aware of beneficial tax options … you want a Worry Free Guarantee … you want an efficient use of your time …. you want your refund money back in your hands fast …. And at the end of the day, you want to KNOW you got the most money back from Uncle Sam AND you know the IRS will stay off your back so you can sleep like a baby at night!
If the tax professional you are talking to (or the tax practitioner you currently use) can’t do what you want, don’t give him/her your business. Go to someone who will be on your side, looking out for your interests and not treating you like a number.
Big Mistake #2:
Letting A Tax Preparer Help You File Your Taxes Without A Guarantee!We already touched on this topic of guarantees earlier, but since having one or more guarantees is so important – especially when it comes to filing your taxes with the IRS – I thought I better go into a little bit more detail just to make sure you are clear on what should be expected of a tax professional in this area. In my view, the more guarantees, the better. And I’m talking about IN WRITING guarantees, NOT some tax professional verbally telling you, “Oh, yeah – you’ll never have a problem if I prepare your taxes … but if you do, I guarantee I’ll fix it. No problem.” That my friend, is not the kind of ‘guarantee’ I’m talking about. I’ve heard too many horror stories about taxpayers getting a letter from the IRS, then they take it to their accountant, and then the letter sits on a desk gathering dust. Or stories about the CPA who makes some calls on your behalf, but you get charged an arm and a leg in the process. Or sadly, a taxpayer doesn’t get any help from the person who prepared their taxes for them so they go it alone and call the IRS themselves and figure out what to do and not to do during this normally ugly IRS correspondence … THIS can be a nightmare! Don’t go down this road! In your case, just make sure the paid tax practitioner you are working with has guarantees, in writing, for you to hold on to if ever needed. And make sure the guarantees include stuff you want guaranteed! Let me give you an example. I’ve seen some accountants guarantee they will file your taxes for you by April 15th or they will file an extension for you. Well, whoopdy do! That sure makes you feel good in the morning, doesn’t it? Other weak guarantees I’ve seen in the tax industry are, “We guarantee we will begin preparing your tax return the same day we meet with you.” That means nothing to me. I don’t care when you start preparing my taxes. I want to know how long it is going to take you to finish it and do so without leaving out silly errors you know you should have caught.
But truth be told….
(if you got to sneak a peak behind what REALLY goes on in most tax professionals’ offices, you’d be SHOCKED!) So let’s pretend you knew what was really going on once you left your accountant’s office – I GUARANTEE you’d be saying (or thinking) the following:
…. you barely looked at my return because you were too overloaded with other tax work and you didn’t hire enough competent employees to help you during tax season …
.
…. you don’t trust other tax preparers doing your returns, but since you get so tired doing everything yourself, stupid mistakes become common place and you hope no one notices (kind of like an ostrich with his head in the sand) ....
…. if I decided to take my taxes and go somewhere else, you won’t care for very long because you’ve got too much going on, getting so many different files mixed up, you don’t have time to even notice ….
The moral of this story is: Protect yourself and file your taxes with a tax business that’s been around for a long time and can back up everything they do with multiple guarantees. And remember: the guarantees should be in areas you care about, like:
Tax Return Accuracy …Speed of Service…Most Money
Legally Yours …Ongoing IRS Protection For Years After Filing …
These are the things YOU care about! Make sure the tax professional you choose stands behind these critical areas of tax filing so you get the most out of your tax filing experience!
Big Mistake #3:
Picking A CPA With Too Much “Accounting” Experience That Doesn’t Relate To You!Most people don’t realize this, but many CPA’s usually spend most of their time doing accounting and auditing work – NOT taxes! (CPA = Certified Public Accountant) They get paid to sign off on accounting, payroll and complicated bookkeeping for larger businesses. So when it comes to preparing taxes for the regular middle income family, it’s just not something they’ve been spending their time thinking about or doing much of most of the year. CPA’s have a ton of experience in many very complicated accounting practices, doing very complex audit work and usually doing a really great job helping some large business or very high net worth rich guy with his investments and taxes. But, for most tax returns that are filed each year … nah. Look, does this sound like your tax return? I thought so. You are not alone. The majority of people will never need the experience coming from a CPA’s background because the accounting and auditing work does not relate to their normal family income status. Am I saying all CPA’s are wrong for you to choose to file your taxes? Absolutely not! There are some Certified Public Accountants who take the time to keep up with the latest tax laws. (Heck, my best friend is a CPA. He prepares taxes and knows what’s going on in the tax world each year.) But, in most cases you are better off finding a tax preparer who is good at doing what you need done. And in this case, if the tax preparer preparers a lot of middle income tax returns already, that’s even better. Think of it this way: Would you use a sledge hammer to hang a picture frame? (I didn’t think so.)
Remember: Go with a tax professional with TAX preparing experience, not auditing or accounting or something else that doesn’t relate to you!
Big Mistake #4:
Going With A National “Brand Name” Tax Firm With Image Advertising!I’m not going to name names here. But, just about everyone has heard of these brand name tax firms right down the block in most cities and small towns. They spend millions of dollars every tax season on “brand building awareness” ad campaigns just so you will think of them when it comes time to file your taxes. The problem is, a “brand name” never prepared anyone’s taxes – people do! So you can have all the famous names, fancy Super Bowl ads and catchy slogans, but when push comes to shove, it is a real person helping you. And behind that one tax preparer, there should be other people who do “return reviews” – and, a manager who is held accountable for quality work -- and a support staff to proactively trouble shoot any issue that might arise – and on and on. Getting a quality tax service from a reputable tax business has very little to do with the award winning promotion, and everything to do with the quality of the tax preparer and the organization to back him or her up. Outstanding personal service just because some smiling face says it on the TV… not a chance! Better listen to what OTHER taxpayers like you are saying. Have they already experienced that particular tax firm’s services in the past and can testify to this effect? If so, that has more credibility than some high paid ad agency putting together some commercial on Madison Avenue. (Hearing it from the “horse’s mouth” so-to-speak is even better. If you can listen to what other real people are saying about their tax filing experiences, and you like what they are saying -- then by all means, go to that particular tax business and give’em a shot at filing your taxes this year.) So for the record, don’t be “blind” to the fact that fancy ad jingles translate into the high quality tax services. They don’t. To be blunt, usually the more IMAGY the promotion (nice looking models smiling in the commercial, pretending nothing would ever go wrong with your taxes -- none of which ever happens in the real world) ... the WORSE OFF your tax service will be. Now, what I just said is not scientifically provable, but if you’ve been around the block enough like I have, you know what I mean.
Big Mistake #5:
Paying Too Little OR Too Much When Filing A Regular Tax Return!Some of what I just said might sound odd to you? Why would I not want to pay too little to have my taxes filed with a tax professional? Well, let me explain. What’s too little or too much? It depends. Let’s start with the “paying too little” for filing a tax return. Who do you think are the tax professionals charging the least amount or advertise the lowest fees for tax preparation? Some of these folks are the “fly-by-night” tax preparers. Yeah, they know a thing or two about filing some tax forms. What they don’t know, they try and figure out as they go along. These are nice people for the most part, but getting them to be your tax representative with the IRS might not be the wisest decision. Other tax professionals who “low ball” on price work out of their house or they have very limited resources related to keeping up with the tax codes and ever changing tax laws. Many times they are “one man/woman” operations so they do your taxes, charge you a low price, but have zero accountability for their work. No in-house quality control, no double-check audit process, no compliance reviews. Do you need all of this? Yes, in most cases. But, if you are a middle income taxpayer with a couple of schedules, extra forms and deductions you are not sure about … well, it’s your neck (and your money) that’s on the line … so I’d definitely say yes then! What about paying too much when filing a tax return? Did you know to some people, paying the MOST money to file their taxes is like a badge of honor… (or if you want to know the secret truth -- it makes the person feel important [like a “somebody”] because they paid $500.00 or $700.00 or $1,200.00 to have their taxes filed!) I’m a rich important guy, “I paid my accountant $600 bucks to file my taxes this year!” as he sips his mint julep at the country club. No thank you! Yes, you’d be surprised, but in a lot of cases, when someone in the middle income tax bracket wants to be sure they’ve filed correctly with the IRS and they (very foolishly) go pay too much at some CPA’s office… with the leather couch and fancy plants and wall hangings … and after they write the check to the accountant for $500 bucks or whatever, they feel pretty good, but their gut tells them something is wrong. Well, there usually IS something wrong. It’s called overpaying when you don’t have to! Regular retail tax offices with nice, clean working environments are just fine. Getting a quality preparer with multiple guarantees backing up their work, ongoing support and year round access to a manager or person in charge is all you need. Do you need to pay $500.00 or $1,000.00 for that? Actually, on most middle income returns, you can pay in the $175 to $275 range and be just fine. Some high-priced tax professionals will charge you $500 or $600 for the same forms and schedules. Or you can find a “Fast Eddie” to help you file your taxes and probably only pay $100 or less. My advice is to find a tax professional who charges by the form so he/she is not pulling fees out of thin air. Like I said, you can over pay or actually under pay – either way, both will come back to bite you in the end. Getting the best value for your money is always the right way to go!
No comments:
Post a Comment