5 Ways to Save Your Tax Professional Time and Save You Money

Just because you’re hiring someone to do your taxes doesn’t mean you want to pay them more than what’s necessary. If you show up at your tax professional’s office with shoeboxes full of receipts, she can absolutely turn that into a tax return; however, it’s going to take much longer than it would if you simply brought her a tax preparation checklist.

Preparation will save your tax professional time and will save you money. Here is a tax preparation checklist to help you streamline the tax process for your business:

Tax Preparation Checklist

1. Organize your expenses and your income.

This is a bit more complex when you’re running a business than when you work for someone else, but the principle is the same. You need to know how much money your business takes in and from what sources.

Accordingly, you also need to know where your business’ money is going. You need to be able to identify, at least in general terms, what you spent on categories such as inventory, office supplies, equipment, and more.

One way to organize your expenses and your income is with an accounting software package. To be sure, you still have to use it on a regular (read: daily) basis for it to be useful. Every time you send out an invoice, the software will track it. Whenever you enter a receipt, you can categorize the purchase, saving tons of time and work at tax time.

2. Do a little bit of work ahead of time.

By becoming generally familiar with the kinds of small business tax deductions you’re going to be able to take, you’ll save your tax preparer quite a bit of time. No one expects you to readily know all of the deductions you’ll qualify for; after all, that’s why you’re hiring a tax professional to begin with. But if you know that you’ll likely qualify for the Earned Income Tax Credit, for example, raise the issue early with your tax professional and know what documentation you’re going to need.

3. Gather your year-end statements.

Depending on the nature of your business, you might have a number of year-end forms and statements that need to be considered when preparing your taxes. This might include things like 1099 forms, brokerage account information, profit & loss statements, and more.

4. Consider a mid-year tax checkup.

If your business pays quarterly estimated taxes, you should consider meeting with your tax professional at least once during the year. This mid-year tax preparation checklist will do a number of things for you. It will:

•Help you to keep on track with your record-keeping
•Let you know if you should adjust your estimated quarterly tax payments for the remainder of the year
•Give you a good idea of how your taxes will look this year
•Save your tax professional significant time by identifying potential problems sooner rather than later
•Give you the opportunity to take advantage of purchases or charity contributions that might be beneficial from the tax perspective.

A mid-year tax meeting also spreads your tax professional’s work out so that you’re not facing a mad dash all at once when taxes are due.

5. Obtain a tax preparation checklist for your tax appointment.

While these points serve as a general tax preparation checklist, your tax professional may have specific items that she needs. These items may be above and beyond this general tax preparation checklist. Your tax professional should be interested in saving you money and time. Many tax professionals will provide you with a checklist of items to bring to your tax appointment. If your tax professional doesn’t automatically provide you with such a list, ask for one.

This tax preparation checklist will help you gather all of that data that you organized in #1 above. Just because you have everything in its place doesn’t mean you always know what your tax professional will actually need to do your taxes.

Ultimately, you’re in partnership with your tax professional. Her job is to help you get your taxes filed as accurately as she can and to help you avoid paying more in taxes than what you need to pay. Your job is to provide her with all of the relevant data and tools to do that. If you spend just a little bit of your own time pulling all of this together, you’ll reduce the number of billable hours you need to pay your tax professional. While it didn’t make the top five tax preparation checklist, paying your preparer must also be on your list.

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