Maximizing the Tax Preparation Interaction

Most people are aware that we are in tax filing season with individual returns due April 15th (or April 17th for those living in Maine and Massachusetts). Extensions are permitted that will postpone the due date, but the payments cannot be extended and balances due and the first quarter estimated taxes, if required, must be paid by the original due date of April 15^th or 17^th.

CPAs, EAs, and professional tax preparers see many clients this time of year and they are obviously busy with this work. It is also a good time of year since we get to see and speak with many clients, many of whom have become friends through these annual and sometimes occasional extra interactions. While taxes are the main focus, clients are provided with opportunities to express other concerns. Usually, these are about the amount of taxes they have to pay, but then they stretch into questions about tax planning opportunities going forward, financial planning concerns including having enough to retire on or whether they would be able retire on schedule, supporting relatives or providing for or contributing toward a child’s or grandchild’s college costs, whether their investment allocations are proper given their goals, how their 401k is performing, how they could start a business and countless other questions or financial concerns they have.

Many CPAs are perfectly qualified to respond to these types of questions, and if they personally are not, then they could have a partner or associate who they could refer you to. However, the starting point is when your concerns are mentioned to your accountant. Unless that is done, nothing will happen. Occasionally, the CPA would start the conversation, but usually, there needs to be an opening, i.e., a display of concern by the client.

Your interaction during the tax preparation process, whether it is a meeting to provide your information, a call that it was received or to discuss the return or its results, is the triggering event. My advice is to prepare for that meeting, such as it is, and have your questions ready or a way of expressing your concerns. The accountant should be able to pick up on what you say. From my experience, many questions can be responded to with a brief response, with some followed up, as appropriate, at a later, less rushed time. The follow ups also might not need much time but would benefit from the question or concern sitting on the accountant’s mind for a reasonable period.

Those that need a more thorough response, or a meeting could engage the accountant for that project. It would be done for an additional charge, but the amount or basis for such charges would usually be explained beforehand and the client could then decide if they want to proceed. The importance of the issue would determine the eagerness of the client to move forward or to let it lay dormant or sit in the backs of their minds.

I also found that many clients are unaware of the full capabilities of their accountant to handle these issues. They are, and the short mention of a concern at that tax preparation meeting or interaction is the way to find out. So, my takeaway to clients is to prepare for your tax preparation meeting by putting together a short list of questions and then voicing them when you speak with your accountant. Make that meeting an encounter that could provide guidance for your entire financial future and security, and not just to have your tax return prepared. This process works!

You do not need to wait for tax season to ask those questions, but now is a good time to do it because of the current interactions.

And do not forget to file your return on time.