Updated January 27, 2019
By Stephanie Cardenas
The new tax plan is intimidating, for everyone, including tax professionals. The <numbers> changed, many of the forms changed, many rules were revised, added or removed and much more. But the process is essentially the same just a bit more time consuming at this time. * Tax plan for 2018-2025 mind you*
Taxpayer’s should provide their information in the same way they had in the past, the result may or may not be the same however. Essentially, prepare the returns as you normally would. Yes, some of your calculated deductions may not “qualify” as they had in prior years, and that will be discussed when TY18 is prepared and can be compared to TY17.
- For Pauline’s Tax Service clients: There’s a forecast in the 2017 client copy that estimates the changes per your situation… assuming it stays relatively the same. Dropping or gaining a dependent will affect the estimate.
- For other folks: Grab your 2017 client copy (form 1040, 1040EZ, or 1040A) and locate your key numbers. Taxable income and Tax due per that income. When 2018 is prepared you can compare your taxable income for both years and the tax due per that income for both years see what the changes were. Pay special attention to last years’ tax rate compared to this years tax rate.
What you will need to prepare your returns
Collect and save all necessary tax related items and documents as they arrive. Create a folder on your desktop or computer if necessary. Once you’re positive nothing else will arrive, upload to the portal or mail/drop off in the office. Use the 2018 tax planning document document as a guide.
-W2’s, 1099’s, 1098’s, 1095’s, any spreadsheets you create, etc.
If you had a baby. That’s fantastic. You will need a copy of the social security card/number, their name, birth date. Additional questions for divorced or separated parents and people who qualify for the earned income credit (EIC).
- The exemption amounts no long apply but the child tax credit is available (For children under age 17).
If you started a business, awesome. You will need a statement that shows the total of all of your income and expenses. Every business is different and has different needs so tailor your income statement to suit you. Here’s an example template.
template income statement
Use the tax organizer or tax planning document as a checklist to ensure you have the required information. 2018 tax planning document
You’re ready to file
Upload your documents to the portal https://ptsdocs.securefilepro.com or mail/drop off packet at the office: 12365 Huron St. Suite 1800 Westminster Co 80234. Remote processing preferred. In the event we need an in-office appointment, ask about the availability of a Saturday appointment.
We’ll prepare your returns and provide you with a copy so that we can chat about what the changes were, if any. E-copies and/or hard copies will be provided, generally within 24-48 hours.
Pay the tax preparation costs: Cash, check or charge. Generally, the tax prep fees range from $100-350 depending on the required forms and worksheets. Most returns are anticipated to be average resulting in fees of $150-200. The tax prep fee includes federal, state(s), e-filing, and many other features. I’m available year round for help with notices and responses to the IRS.
- The audit process is generated electronically and randomly so always understand what they are PROPOSING before you agree and/or pay. But ALWAYS respond in a timely fashion.
- Double check if the question is asking for the last 4 of your social or the last 5.
- You will need your username and password to log on to the portal, and if any client copies are password protected use the last 5 of the primary taxpayer’s social security number.
- Try using the forgot password, if you already have an account. For new clients Ill need the last 4 of the social to set up a client portal so upload as a guest.
You should know, generally, what your tax liability is for the year and plan on a 3 year basis. Take a look at the last 3 years tax return copies and locate your tax due for those years. Pauline’s Tax Service Clients: Included in every client copy is a Comparison Sheet that lists the last 3 years side by side.
If you generally receive large refunds, you are doing this all wrong. Refunds aren’t extra money… unless it is like from the Earned Income Credit but that’s another topic. Refunds are of your money previously withheld from your paychecks to cover your estimated tax liability. The goal is to only withhold your estimated tax liability, in which case and in theory you would come as close to receiving nothing and owing them nothing at the end of the year.
If you over estimate your tax liability the IRS holds your money interest free all year long and gives it back when its convenient for them. A more in depth piece to come about this but the point will be to keep more of your money on your paychecks during the year.