Top 7 questions you must ask your accountant:
1. What information do you need from me?
You must come prepared for an accounting appointment. You should collect and categorize any documents that you have into groups such as business vs. personal expense receipts. If possible, you should add up the amounts in each category and print off any expense reports. This will save your accountant time and will save you money, otherwise, your accountant can add up all your expenses for a fee. Having your documents and totals prepared will ensure that you get the results you are looking for and won’t have to make an unnecessary second visit.
2. When will my tax return be ready for review?
This helps accountants commit to finishing up their work by a specific date, which in turn helps them prioritize your return in their workload. This is especially important if there’s a chance you might need your tax return earlier than normal because you are applying for financial aid or buying a house.
3. Is there anything on my tax return at risk for an audit?
Just what does the IRS look for when selecting a tax return to audit? Two things: missing information and items that seem large, unusual, or questionable. The IRS’s computers are very good at comparing all the filed W-2s and 1099s with what’s reported on a person’s 1040. IRS auditors are trained to look for numbers that seem too large in comparison to the rest of the return, or unusual deductions that don’t make sense for a particular situation.
Does anything stand out on your return? Ask your accountant to look at your tax return through the eyes of an IRS auditor. Once your accountant has identified three or four things that might catch an auditor’s eye, ask how you can organize your documents and data to support those potentially suspect entries found on your tax return.
4. What Technology Do You Use?
It might be hard to believe, but some accountants still use DOS-based accounting software. An accountant who is stuck in the ’90s is unlikely to advise you on the benefits of newer technology, which could help you improve workflow and smooth out processes. Find an accountant who uses cloud-based accounting software so you can be across the financial side of the business and access data in real-time.
5. What are some common mistakes that I should avoid when working with you?
Not being 100 percent honest with your accountant is the worst mistake you could make. They cannot help you if you are not honest with your situation. Being transparent with your accountant will ensure that you get the best advice suited directly to your situation.
6. Can you help me estimate my income for 2022?
Go beyond salary; bonuses, freelance assignments, investment income, alimony, winnings, and other income all play a role. And it’s not enough to know gross income. It’s also important to have an estimate of adjusted gross income, modifications to adjusted gross income, and taxable income. Each of these types of income is dependent on various deductions or credits that need to be estimated in order to come up with projections for the next year.
7. Do you have any recommendations for reducing my 2022 taxes? What about 2022 and beyond?
This might be the most important question to ask your accountant. Be sure to ask a professional, ask us. Every Tax situation and every individual is different. It is important that you get the best Tax advice suited directly to your individual situation. Call (800) 913-0809 or SMS (224) 676-3577.