Illinois, USA - More than half of Chaldeans will pay someone to prepare their tax returns this year. An even larger number have paid thousands of dollars throughout the year on bookkeepers and accountant services. How do you know you received a great value? Can you negotiate your fees?
Tax professionals like any other profession talk shop and share insights. They tell other professionals things they won't tell you, including stuff that could help you deal with your own tax pro and maybe even save you money, if only you knew.
Here are five things Chaldeans probably have never been told by a tax pro:
1. Be Organized.
Clients who are organized get charged less. Accountants and tax professionals, like any other business, rates are influenced a great deal by the clients. Most firms will charge using a combination of hourly rates, complexity of the tax return and the so-called "hassle factor."
Being unorganized and having information dribble in randomly increases the hassle factor and the amount you will be charged. Chaldean tax professional Sami Razooky says, "I wish there was a nice way I could tell clients to wait until they think they've got all their information and not both sending me part of it now and part later. I cannot complete the puzzle until they give me all the pieces."
Raad Hami is a bit more direct. "Every time I open up a client's file to add another form or another piece of information, the cost of preparing the return goes up," he said. "I charge for my time. How else can it be?"
2. Better Quality Means Being Early.
It's human nature. Early in the tax season, tax professionals feel like they have more time. This doesn't necessarily mean you're going to get a "better" return but, it sure helps increase the chances. A good tax pro should go through the same questions and process regardless of when the return is done. However, you have to figure that if your return is being worked on early in the tax season, a little more time (including time talking with you) is going to go into it than would otherwise be the case. Seeing a tax pro before the end of February is best.
Each tax office has its own "crunch" period, but for most the worst weeks fall somewhere between March 15 and April 15. Interestingly, Tax Day itself, April 15, often is not that bad a day. Many tax professionals leave that day open for any last-second calls and clients picking up their returns. All the returns that are going out will have been finished by the 13th or 14th of the month.
3. Last-Second Rush Jobs are Despised.
Like most professional services a tax pro knows a good amount of their business originates from word-of-mouth. In short, tax professionals want to provide the client with quality work at an exceptional value. Hami says, “If someone I've never talked to before calls me on April 12, saying he needs to file by April 15, I'm probably going to refer him to someone else. I don't want to take on a new client that close to the deadline and potentially take time from my existing clients or convince them to file an extension.”
4. Extensions Are Par for the Course.
Many taxpayers worry that they're going to have trouble with the IRS if they file an extension. Little if any evidence supports this myth. In fact, extensions are the perfect solution for the taxpayer who would otherwise be a "rush job." It's way better to file an extension and send in an accurate return later than it is to rush to meet the April 15 deadline and later discover things you missed saving opportunities or that you are required to amend the return.
With the extra time afforded by an extension, Chaldeans can go over their tax situation after April 15 and make sure all the documentation and questions that could help trim their tax bill have been addressed. Individuals can get an extra four months to send in their return by simply filing Form 4868 by April 15.
5. Ask Plenty of Questions.
You have a duty to ensure you fully understand all aspects of the work being performed. Remember the professional works for you. Be polite and thoughtful when asking your questions. Just be sure to ask them. Great professionals respect Chaldeans who ask plenty of questions. It also shows you are interested and involved and want quality work. At a minimum, questions force the decent professional to be more concerned with your work. The best professionals are the ones that are eager to fully explain the entire process every step of the way and make it comfortable for the client to ask questions. If any professional makes it difficult or does not support your inquiries, leave them immediately.
Bedre Konja is a senior business consultant and entrepreneurial manager for Illinois based, Magi Consulting, Mr. Konja is a CPA and licensed tax attorney. Magi Consulting specialize in helping entrepreneurs start, grow, and manage their business. Services offered by Magi Consulting include capital fund management, new business development, acquisitions and mergers, organizational policy and procedures, technology integration, auditing, and assisting private companies in going public. Mr. Konja lives in the Chicago suburb with his wife, and six children.