Every year, millions of Americans file their taxes. Most of them are in need of serious help in this complex area. The tasks related to filing taxes can be very time consuming. Adding further difficulty is the fact that you have to be just right when it comes to tax preparation in Kissimmee. Therefore, a lot of people turn towards an expert who helps them in handling their tax preparation in Kissimmee.
Rushing through your taxes will only cause distress in the future. As a responsible citizen, we are sure that you want to get it right the first time to save your time and money.
We have a few tips that will help you in tax preparation in Kissimmee. Keep on reading this article and you will get answers to all your questions.
Do Your Homework
Before you choose a person for handling your tax preparation in Kissimmee, you need to make sure that they are reliable for the job. For the past few years, there have been a lot of scams in tax preparation in Kissimmee. There are many hackers and fraudulent tax preparers who are taking advantage of peoples’ needs and stealing their hard-earned money.
Filing false tax returns for your clients can result in prison time. IRS has been tracking these fraudulent tax preparers.
Tax preparers have access to your financial records. Therefore, it is important that you pick one who is trustworthy. To make sure you don’t fall victim to any of these scams or fraudulent schemes, here are a few tips that will help you choose a professional tax consultant for handling your tax preparation in Kissimmee.
- Tax Identification Number
All the people who are eligible to prepare your taxes are registered with the IRS. Paid tax preparers, tax actuaries, enrolled agents, attorneys, and certified public accountants are assigned a preparer tax identification number or a PTIN. When looking for a tax preparer to handle your tax preparation in Kissimmee, you need to make sure that the person you hire has a valid PTIN. Without that, a tax preparer is not allowed to handle the tax returns of their clients. Make sure you check the IRS directory to see if they are listed there.
- Dig a Little Deeper
Having a PTIN does not mean that the tax preparer is legit. It just means that they are registered to perform tax returns. You need to dig a little deeper to make sure that there have not been any complaints or objections over their tax preparation in Kissimmee. You can check the audits, collections, and appeals from the IRS to make sure that you won’t run into any issues with your hired tax preparer.
- Ask All the Questions
Having an accounting degree does not necessarily mean that the consultant will be perfect for the job. There are a lot of people who have a specialty in tax law or an accounting degree who don’t know how to handle tax preparation in Kissimmee. You need someone who will suit your needs and give you the best advice regarding tax preparation in Kissimmee. Make sure that you have answers to all the questions before you hire the consultant. Ask for their references and experience about their background in tax returns. Are they aware of the recent changes in the tax code? What kind of courses have they taken for specialization, and will they be of any use to you? Will they be there to help you if your tax returns are rejected or audited? Get answers to all these questions before hiring a consultant to handle your tax preparation in Kissimmee.
- Promises of Refunds
Did the consultant you hired for tax preparation in Kissimmee promise you will get a hefty refund without even looking at your income? Yes, this is definitely a red flag. Run, Forrest, run!
Jokes apart, if your consultant does that, you need to get a new one. They are just looking to acquire your business. You need someone who will give you sound advice and will not make false promises.
- Billing and Compensation
Before you select a consultant to help with your tax preparation in Kissimmee, you need to know how you will be billed. Some tax consultants bill you by the hour, while others have a fixed fee. The fees can vary depending on the complexity. Make sure to ask this question so you don’t get caught by surprise later.
If your tax consultant says that their fees will depend on your refund, don’t hire them. There is a chance that they will not do this job ethically and get deductions you are not entitled to or overstate contributions to charities.
- Are They Secure Against Hackers?
There has been a string of incidents where tax preparers were hacked. Sensitive data about your financial statements can get leaked if the consultant you hire for tax preparation in Kissimmee gets hacked.
There are many hackers who target tax consultants via email attachments or links. These hackers can use the data for their personal gain or even fill out false tax returns under your name and take advantage of the returns. Make sure that your tax preparer has taken measures to prevent this from happening.
- The Early Bird Catches the Worm
There are a lot of people who wait till the last day to file their tax returns. Trust us when we say that you don’t want to be one of those people. Ask your tax consultant who is helping you in tax preparation in Kissimmee to file your returns as quickly as they can.
The reason behind this is not just efficiency, but also to prevent you from getting scammed. There are a lot of cyber thieves who file fraudulent tax returns using your information and claim your refunds. Your application for tax returns will be rejected if someone has used your information to file false taxes. This will cause the IRS to step in and investigate before you can re-file your refunds. This investigation could take up to a year.
- Review Your Tax Returns
Once you have chosen a consultant to help in you in tax preparation in Kissimmee, make sure that you review the returns before they are filed. There is no such thing as blind trust when it comes to your financials. Don’t ever sign a black return. Make sure you have some knowledge of exceptions and tax returns so that you can check for any discrepancies.
Tax Preparation in Kissimmee Checklist – What do you Need?
The tax season is arriving and a lot of people don’t know what they need for tax preparation in Kissimmee. Whether you are hiring a professional or doing your taxes on your own, you need to have the following documents to make sure everything goes smoothly.
- Personal Information
You will need yours and your spouse’s tax ID number or social security number. The full name of your spouse must also be mentioned.
- Dependent(s) Information
Date of birth of all the dependents in your house. Their tax ID numbers or social security numbers are also required. Childcare records are also to be mentioned. Make sure that you don’t forget to get the provider’s tax ID number. If there are any other adults in your home, their income details will also be required.
If you have a non-custodial child living with you, you need a form 8332 in which the custodial parent gives their consent on your claim to the child.
- Sources of Income
You need to attach your sources of income. For employed candidates, you need W-2 forms. Unemployed candidates need to produce form 1099-G (state tax refund.)
For self-employed candidates, you will need forms Schedules K-1, Forms 1099-MISC, and also income records which will be used to verify the amounts. Make sure you have all the records including receipts, credit card statements, or check registers for all the expenses. If you operate your office from your home, you need to mention that as well. Form 1040ES will also be required to show the record of expected payments of tax made. Don’t forget to provide information on business-used assets for depreciation.
If you are getting any rental income, you are required to present a record of expenses as well as income. Also, rental asset information like date placed in service and cost also needs to be mentioned for depreciation. Form 1040ES is also needed to showcase the record of estimated tax payments made.
Your consultant who is helping out with the tax preparation in Kissimmee will also need form 1099-R for retirement income – annuity income/ IRA/ pension. Also, add the traditional IRA basis – the amount contributed by you to the IRA and was taxed already. Any dividends, investments, savings, and RRB (RRB-1099) should also be provided to your tax consultant. You will also need the forms 1099-DIV, 1099-OID, and 1099-INT for your dividend and interest income.
If you made any income from the sales of any property or stock, you will need to fill forms 1099-S and 1099-B. you will also need to fill out forms 1099-LTC and 1099-SA and give them to your tax consultant. These forms indicate any long-term care reimbursements and your health savings account and will be needed for your tax preparation in Kissimmee. Any and all expenses related to the investments you made also need to be mentioned for taxes. If you have any other losses or income like gambling income, you will need to turn in a W-2G form.
Other incomes include trusts, awards, prizes and hobby expenses. Royalty Income should also be given to your tax consultant. Also, you must not forget to give the record of alimony received or paid to an ex-spouse to the tax consultant helping you in tax preparation in Kissimmee.
- Types of Deduction
Your tax consultant assisting you in tax preparation in Kissimmee will tell you about the things that are tax deductible, but there is no harm in brushing up on this knowledge beforehand.
The things that come under the form series 1098 are all tax deductible like home ownership, personal property, and real-estate tax records, mortgage interest statements, and receipts for energy-saving home improvements.
Donations make in charitable organizations, schools, or houses of worship will also be excluded in the taxes. You need to present all the records of all the charitable donations that weren’t made with cash to your tax consultant. Tax is also deductible on the number of miles driven for medical as well as charitable purposes.
All the cash paid on medical expenses like hospitals, dentists, doctors, and healthcare insurance will also be deducted from the tax. You will need to showcase where you are enrolled for your healthcare coverage plan – government or private.
Expenses related to childcare are also tax deductible. Any fees paid for a licensed daycare for a preschooler or an infant are not to be included in the tax. If you employee a babysitter, you will not need to add their wages in the taxes either.
Educational expenses are also tax deductible. You will need to show receipts of educational expenses and forms 1098-T from the educational institutions. Also, don’t forget to present the records of any fellowships or scholarships you might have received.
Other tax-deductible amount includes job-hunting expenses, vehicle expenses relating to your employment, other employment-related expenses, and the amount paid last year for tax preparation in Kissimmee.
Sales taxes or local and state taxes are also tax deductible. Also, make sure that you have the invoice that indicates you have paid sales tax on your vehicle.
If there were any repairs made on your house due to a federally declared disaster, you will not need to pay any taxes on that.
Hope these tips will prove to be helpful when you are hiring a consultant for tax preparation in Kissimmee. This checklist will help you in getting all your ducks in order to make sure the tax season goes smoothly.