“If we do not change our direction, we are likely to end up where we are headed.”
– Chinese Proverb
Last week was crazy!
I’m glad to say that we worked very hard during the “offseason” so that we would be prepared for the tax season rush!
That said…shutting those doors at the end of the day on Thursday (the 15th) was sweet. My teamÃ‚Â and I could look back on months of hard work, and take real satisfaction in hard work and a bunch of new client relationships which we’re excited to see last for years.
That’s a good question–and it takes me back to our offseason preparation. Sure, we’ll be taking some well-deserved vacation around here soon.
If you’re new to us this year…you’ll soon find out that we make big deal around here of keeping in touch, and offering you hope and wisdom about the current state of the economy–and YOUR wallet!
Many tax businesses shut their doors pretty firmly during the summer and fall. Not us.
This week’s Strategy Note, in fact, deals with a topic which most taxpayers have no idea about. This one, actually, is probably one to forward to your friends…
“Real World” Personal Strategy
Little-Known “Secret”:Ã‚Â Amended Returns
As a client of mine, you’ve already got the peace-of-mind that you were able to claim every possible deduction legally allowed in the tax code. We put each return through an extensive review process to ensure that you’re keeping all the income you deserve to keep.
But what about your friends?
Well, since it’s now AFTER April 15th, they might think that the proverbial “fat lady” has sung on their 2009 returns. Not so.
Did you know that according to a 2002 report issued by the General Accounting Office, taxpayers overpay the IRS almost $950 million every year, which equates to an average overpayment of $400 per taxpayer. That’s a somewhat dated report…and the current numbers are certain to be higher.
What’s worse is that folks who prepared their own taxes (with a software, or on their own) are the most vulnerable. But did you also know that taxpayers who used one of the “big chain” preparers are almost as bad off?
An excerpt from a more RECENT report from the GAO (2006):
In a Limited Study, Chain Preparers Made Serious Errors
In GAO (United States Government Accountability Office) visits to chain preparers, paid preparers often prepared returns that were incorrect, with tax consequences that were sometimes significant. Some of the most serious problems involved these preparers…
1.Ã‚Â Not reporting business income in 10 of 19 cases;
2.Ã‚Â Failing to take the most advantageous postsecondary education tax benefit in 3 out of the 9 applicable cases; and
3. Failing to itemize deductions at all or failing to claim all available deductions in 7 out of the 9 applicable cases.
More clippings from the report:
* The 19 paid preparers we visited arrived at the correct refund amount only twice. On 5 returns, they understated our refund amount by a total of $3,465.
* All 19 of our visits to tax return preparers affiliated with chains showed problems. Nearly all of the returns prepared for us were incorrect to some degree, and several of the preparers gave us very bad tax advice, particularly when it came to reporting non-W-2 business income. Only 2 of 19 tax returns showed the correct refund amount, and in both of those visits the paid preparer made mistakes that did not affect the final refund amount.
So what can your friends do about this? Simple: file an “Amended” Return.
Many tax businesses don’t provide this service, but even though we’ve completed our clients’ returns, we WILL review any of your friends’ returns–at no charge.