Why We Are Not “While you Wait” #TaxPros

The complexity of the tax code and the uniqueness of each client’s circumstances are why I don’t prepare your tax return while you are in the office. If I had a quarter for every time someone called with a “quick question” or said “my taxes are really simple” I could probably retire (not that I want to). If you’ve ever called me with a “quick question” you’ll know that most of the time my answer is either “Off the top of my head I’d say this, but let me do some more checking and call you back.” or “I’ll have to run the numbers and call you back.” Truth is, in general, there are no quick questions. The tax code is complex and highly dependent on individual facts and circumstances—not to mention actual numbers. Just because a friend or relative or neighbor got this or that credit or deduction doesn’t necessarily mean that you get that credit or deduction too. Even if you think you are in similar financial circumstances you may not be. It never hurts to ask of course and our offices welcome your questions, but we may not always be able to give the answer you are hoping to or expect to receive.

When it comes to answering your questions and preparing your tax return, I like to ensure that we have a chance to enter all the data; review the numbers, your situation from last year, any new information, and this year’s return; and prepare a list of our own questions if necessary. To do this requires a great deal of focus and, I’ll admit, I just don’t have the focus I need when I have an audience (and neither does Anna). On more complex returns we like to set the return aside and review it a day or two later just to make sure we have thoroughly considered all of the circumstances and haven’t missed anything. We also like to spend some time just talking with you each year and maybe planning for next year and it’s easier to do that when we’re not trying to work at the same time. That’s why we offer you an appointment to come in and review your return and sign it. Of course if you would rather skip the appointment (and the chitchat) that’s OK too. Occasionally, Anna (in the Tonopah office) will do a “while you wait” return for a returning client with an extremely simple 1040 or a 1040-EZ, but that is the exception, not the rule, and it is solely at her discretion.

Returns prepared in the office must be mailed in, uploaded, or dropped off at the office. If you are a returning client and would like some time to review the information in the organizer when you bring it in (or after we have received it) we can consult with you in the office for an additional charge. New clients are asked to come in for a (free) intake interview for identity verification and a brief document review. All clients should be aware that there are many questions I cannot answer until I have had a chance to enter the data into my software and review the results.

As always, our goal when preparing your tax returns is to give you the highest quality service while maintaining reasonable prices. Our office processes and policies help us to do that. We are committed to building long-term relationships with our tax clients and appreciate your business and your referrals. I’d like to take this opportunity to thank you for your business in past years and for coming to us in the 2017 filing season.

Time to prepare your 2016 tax return! DIY or #TaxPro?

Three things usually come to mind when people start to think about doing their taxes: using TurboTax, hiring a CPA, or walking into a big franchise that does a lot of advertising. All of those are perfectly viable solutions, but there are other options. You should choose the option that best meets your needs.

Do It Yourself With Software: Whether you choose a package like TurboTax or file online for free through the IRS website, this option will work for you if you have a basic understanding of what needs to be done and if your tax situation is relatively uncomplicated. When I say “relatively uncomplicated” I mean that you are a W2 employee with a minimal number (or no) itemized deductions and only basic banking and investment accounts. Of course, the requirements of the Affordable Care Act (a.k.a. Obamacare) add a level of complexity for anyone who doesn’t have Medicare or employer-provided coverage for everyone in the household. If you changed jobs, had a gap in coverage, or received the Premium Tax Credit, you still may want to consult a tax professional even if the rest of your return is fairly simple.

Pay a Professional: If you own your own business, have a rental property, have brokerage accounts that are not retirement accounts, are eligible for the Earned Income Tax Credit, have higher education expenses, have income in more than one state, or any number of other “complicating factors” it may be in your best interests to consult a #taxpro. I know that the tax software companies want you to believe you can have a rental property or own your own business and still do your taxes yourself, and maybe you can, but the consequences of failure are relatively high so maybe you don’t want to. If you decide you don’t want to it’s important to realize you have more options than a CPA or a Tax Attorney. You can choose an Enrolled Agent or what is known as an “unenrolled preparer.” Click here for more information on the different types of #taxpros.

5 Questions to Ask Your #Taxpro

If you have never used a #taxpro before, or if you usually walk in to a tax preparation chain, or even if you are thinking about changing preparers, you need to remember that the person who prepares your tax return has access to your entire financial identity. You need to be sure the person you are using to prepare your taxes meets your needs and your expectations. Before making your final decision ask each potential preparer the following questions:

  1. What are your credentials? (CPA, Attorney, EA, Annual Filing Season Program Completion, etc.) Read this earlier post to find out what all those letters mean. You might also ask about professional affiliations. Is the practitioner a member of the NATP, NAEA, AICPA, etc? While membership in professional organizations does not necessarily indicate competence, it may indicate a certain level of seriousness about the profession.
  2. How much continuing education do you normally do each year? Each credential comes with its own requirements. Note that CPA and Attorney continuing education requirements do not necessarily have to be in tax matters while those for Enrolled Agents and the AFSP are specific to tax matters and professional ethics. In my opinion 15 hours of continuing tax education each year is the bare minimum for maintaining professional competence. As an EA, I am required to get 72 hours of continuing education every three years (so 24 hours per year on average). I usually get 50-100 hours of CPE per year.
  3. How long have you been preparing returns and how many returns do you prepare each year? Experience isn’t always required, but it is helpful. I was talking to someone recently who said that she had a former IRS employee interested in buying her tax practice. She said that during her first conversation with him it came up that he had never actually prepared a tax return. Depending on the complexity of your return, that could be important. The number of returns prepared per year speaks both to the preparer’s experience and to his or her availability. My personal opinion is that even with outstanding office processes and a certain amount of support staff it is difficult for any one preparer to handle more than 200 or so returns per year (at least during the ‘tax season’ proper part of the year, if a percentage are put on extension that means more can be processed). If a preparer is part of a larger office where interviews and data entry and other tasks are handled by support staff the number of returns per year could be larger (even much larger). This is a judgment area for you. How much personal interaction do you need/want with your preparer? Are you willing to pay more for more/better access (some preparers offer ‘concierge’ service for a premium)? The answer to those questions may help you to determine if your potential preparer is right for you.
  4. How much experience do you have with my type of return? If you have rental properties; live abroad; are clergy; are in the military; have income from multiple partnerships, trusts, etc.; or if the return is a business entity return (or any number of other highly-specialized situations) it is important that your preparer have experience with that type of return. People who routinely work in multiple states (truck drivers, pilots, flight attendants) need specialized support as do farmers, ranchers, and professional fishers. It’s OK to go with someone who has only limited experience, but you should be comfortable with their ability and willingness to research the necessary issues (which is one reason why that continuing education question is so important). For example, I recently declined a potential client because I don’t generally do returns for retail businesses (the business return side of my practice focuses more on the needs of freelance professionals and personal service providers).
  5. How will you protect my information? Don’t expect an extremely detailed explanation, but your preparer should have computer security policies in place (firewall, malware protection, and update schedules are the bare minimum). In addition to computer security policies, the preparer should also have policies on staff training (if applicable) and physical protection of your information (how paper files, laptop and desktop computers, and backup media are secured). Finally, you should ask about their data storage and backup plans. This post contains a few more specific questions related to computer security. Again, don’t expect specifics, just enough information to ensure that your data is reasonably protected from being damaged, lost, or stolen.

Notice that not one of these questions is “How much do you charge?” Preparer fees exist on a continuum and those competing on price alone are rarely your best option. Cost is always a concern and, as someone who also does personal finance consulting, I would be remiss if I told you to simply throw caution to the wind and to hire whomever you want. Many preparers can and will give you an estimate based on prior year’s tax returns if the current year’s return is expected to be similar. When evaluating cost consider the preparer’s credentials and continuing education (those are expensive to maintain), the office overhead (support staff and large offices are obviously more expensive to maintain than a lone preparer working out of a home office), and level of service provided (can they represent you, are they in the office all year, etc.). As with all financial decisions trade-offs exist. Find the preparer that best meets all of your needs and realize that may not be the lowest cost option. Of course it is important to remember that higher price is not a guarantee of quality service. Choose wisely, choose well.

Looking for a #TaxPro? Both offices are accepting new clients.

The IRS will begin accepting e-filed returns on January 23, 2017. This season’s filing deadline is April 17, 2017. Both offices (Albuquerque, NM and Tonopah, NV) are accepting new clients for the 2017 filing season.

If you need a #taxpro in central or rural Nevada, contact Anna in the Tonopah office. Please note that the Tonopah office prepares only individual returns. Return preparation includes all associated schedules including Schedules C (business income), E (rental income), and F (farm income). If you need to file a Form 1065 for a partnership or an LLC or a Form 1120-S for an S-corporation your return will be prepared by me (Amber) in the Albuquerque office. I am happy to accept business clients from Nevada or other states outside of New Mexico, but I do require a rather extensive client interview before accepting new business tax preparation clients.

2016 Tax Organizers – How to Get One and What to Do with It

The first step in the return preparation process is to request a 2016 Tax Organizer. The tax organizer includes an introductory letter that explains what’s in the packet, a copy of our engagement letter (for you to sign and date), our privacy policy (for you to sign and date), and a questionnaire and supplemental information to help you collect the documents and information you need for us to prepare your federal and state tax returns.

We encourage new and returning clients to use our secure file portal to send and receive documents. The secure file portal is easy to use, only a username and password are required to set up your account (not your whole life story). If you have ever downloaded a bank statement, W2, 1099, or information from your healthcare provider or insurance company you can do this. We use the same type of system and it meets the same level of security compliance that is required of banks and brokerage firms (e.g., it’s highly secure if you use a good strong password and change that password annually). The file portal helps us to meet our security compliance requirements and helps us to keep costs down (which helps us keep our prices competitive). We will also e-mail you a blank organizer or send you one via U.S. Postal Service (snail mail) at your request.

Once you get your organizer, review the engagement letter carefully and sign and date it. Do the same for the privacy policy. If you have any questions about the engagement letter or the privacy policy, please call or e-mail us and we’ll be happy to answer them for you. Complete the questionnaire and use the additional information to help you collect your thoughts, documents, and supporting information. If you have any questions or want to bring something to our attention, simply write it directly on the questionnaire. When everything is ready to go, it’s ready to be returned to our office for processing.

You may return your information by U.S. mail (or another courier service), by scanning and uploading it to the secure file portal, or by bringing it to the office. For the 2017 filing season only, in addition to the West Side office, the Nob Hill office is available for you to drop off documents. Business hours at the Nob Hill office are from 8:00 a.m. to 5:00 p.m. Monday through Friday. You may also use the outside mail slot to drop your documents after hours at the Nob Hill office only but please be sure to use a sealed envelope and to write The Gray Agency/Amber on the envelope. There are two businesses with “Gray” in the name at the Nob Hill Executive Center so be sure yours gets to me! Please note that we do not begin processing returns until we have your signed engagement letter, so don’t forget to include it with your other tax documents!

Returning Clients: You may bring your documents to the office during business hours but, as noted in the last post, we are no longer offering a free document intake appointment for returning clients. In part, this helps to increase office efficiency so that we can continue to accept new clients while also keeping prices reasonable. But, to tell the truth, part of the reason I am doing this is that I find it hard to discuss your return intelligently before I’ve had a chance to take a look at it. So I like to get the data entry done, take a look at the numbers, and then review your questions (which is why I ask you to write them on the organizer) and then reach out to you via phone or e-mail for additional discussion. If you must see me when you return your organizer, there will be a $42 surcharge (plus NM-GRT) added to your bill (and I probably won’t have any good answers to your questions beyond “I’ll need to run the numbers and/or do some more research.”).

New Clients:  When you have everything ready, please call the office to set up an intake appointment. As a rule, I like to do intake appointments in person in my office when you are returning your organizer (or via Skype for new out of town or out of state clients who return their organizers by mail or upload). In rare cases, I will arrange a meeting at your home or someplace other than my office, but these visits are subject to a surcharge. This initial meeting gives us a chance to meet and go over your situation and concerns. It’s part of what you get (or what I think you should get) when you pay a professional to prepare your tax return. I’m looking to build long-term client relationships and you are entrusting me with your entire financial identity, so it’s important that we meet face to face at least once. Best practices require that I verify the identification of all new clients (even if I know you, I have to check the box). Consequently, at your appointment I will need to see a state-issued driver’s license or other state-issued photo ID and a Social Security card for both the taxpayer and spouse. For any dependents claimed on the return I will need to see a Social Security card and a birth certificate. If you do not have or cannot locate these documents before your intake interview please call or e-mail the office and we can discuss acceptable substitutes.

Your organizer is date stamped when we receive it in the office and returns are processed on a first in, first out basis.

Intake Appointments and Home Visits 1

Starting this year document intake appointments will be provided for free to new clients only. In past years all clients were able to meet with me twice during tax season (once when dropping off their documents and once when reviewing their return) and both appointments were included as part of the return preparation fee. This year returning clients who wish to have an intake appointment (to meet with me) rather than simply completing and returning the organizer and their tax documents (by dropping them off at the West Side or Nob Hill office, by mail/courier, or by secure file upload) will incur a $42 surcharge.

In general, I expect all clients to return their organizers and tax documents to me at the office via mail/courier, by hand, or by secure file upload. I also expect all clients to come to the office for return review and signature when the return is completed. In rare cases I or a staff member may pick up documents at your home or another location and I may come to your home or another location to review your return and get your signature. Beginning this year, home visits may be subject to a $10-$25 surcharge. Please remember, home visits are a rare exception and are not provided/scheduled simply because it is inconvenient for you to come to the office. If you do not wish to come to the office, we can always process your return using mail/courier or secure file upload for no additional charge.

I did not make these changes in process and pricing lightly. It is necessary to ensure that all clients receive quality service, value for their money, and to ensure that I am able to provide adequate attention to each client’s return and enough time for a full review of each return at your signature appointment. If you have questions please call the office at 505-352-0058 and someone will be happy to speak with you.

Happy New Year!

While today is a bank and work holiday for many of you, I’m here at the Albuquerque office gearing up for the 2017 tax season. I and the government have many changes in store for you this year. In addition to the new office location, I have hired some additional administrative staff to help with the phones, etc. I expect the admin staff to be here full time during tax season and part time the rest of the year. So be on the lookout for new faces (and names and voices)! I’m also implementing some changes to our office processes to make good use of the admin staff’s time, to keep prices reasonable, and to ensure that the office remains in compliance with applicable state and federal laws as well as best practices for tax offices. I’ll be posting specific updates on some of the most important changes over the next several weeks (while you’re collecting your documents).

Finally, reminder postcards will be mailed on January 10th. The postcards are your signal that we are ready to send organizers and schedule appointments.

I am looking forward to preparing your 2016 tax returns and to seeing all of you again this year!

I’ve Moved!

The Albuquerque Office has moved from Nob Hill to the West Side. The new address is 5300 Sequoia Rd NW, Suite 205. Coors & Sequoia. I realize that coming to this office may feel like visiting “the outer limits” to some of you, but it is doing WONDERS for my carbon footprint. I can walk or bike here from my house.

Deadlines are looming!

You may or may not know that this year tax day is April 18th. Between the extra three days in April and this being a leap year there are four more days than we usually have during tax season.

Have you made your appointment/dropped off your documents yet? You might want to do that. This year we are imposing either a $75 “priority processing fee” for initial document drop-offs that occur after March 31st (if you’ve already dropped off most of your stuff but are waiting on a K1 this does not apply to you). If you don’t want to pay that, you can pay a $25 fee to have us file an extension. That doesn’t mean your return won’t be done on time or shortly thereafter, it just means we expect to have to file an extension. If we don’t have to file it, the $25 fee will be applied to your bill.

If you are a new client coming in after March 31st, expect to be extended. We do not like to rush new client returns.

So if you have been procrastinating about bringing in or uploading your documents, it’s time to stop and “git ‘er done!”

Albuquerque clients, please note that I will be unavailable for appointments the week of March 28th. I will be working in Nevada. So you have two weeks to get your docs in if you want to avoid additional charges.

Apple Computer vs. the FBI

I am always concerned about information security and encryption is an important part of that. It’s tax season, and I’m crazy busy but I have been following recent developments between the FBI and Apple Computer with interest. I haven’t been following closely enough to create my own response to the topic, but I recently read Mark Cuban’s response and I think he’s got the right idea.