Individual Income Taxes

“How can I be sure I am complying with all the federal, state and local tax filing requirements for individual income taxes?”

“Why do I need a CPA to prepare my individual income taxes when I could just buy some software and prepare them myself or go to a seasonal tax preparer?”

The Certified Public Accounts at Wilging, Roush & Parsons have decades of experience in serving our clients individual income taxes needs.  We invest significant resources to keep out staff up-to-date on all tax and regulatory changes that are rapidly occurring at all levels.  Consequently, our understanding of individual income tax regulations enable our clients to maximize allowable deductions, take advantage of new tax incentives, and plan for the future.

A common misconception is that only large businesses and high-wealth individuals benefit from utilizing a CPA firm.  Our client base ranges from simple to complex returns, with clients across the spectrum of financial circumstances who benefit from the tax savings and peace of mind we can bring.

The knowledge and experience of our team of tax professionals far surpasses that of a seasonal tax preparer whose education consists of a brief training course.  Income tax regulations are complex.  Even with the best software packages, erroneous returns can still be filed when not reviewed by someone with intricate knowledge of tax regulations.

Tax minimization is a year-round process that requires our clients to be informed so they can make sound tax planning decisions.  Our staff is always available during the year to answer questions and to provide quality service and solutions to clients on tax issues as they arise.  The Certified Public Accounts at Wilging, Roush & Parsons CPAs work hard to be our clients “Tax Advisors” and not just their “Tax Preparers.”

TAX RETURN PREPARER FRAUD

The IRS issued an article (FS-2008-10, January 2008) regarding tax return preparer fraud.  The complete article can be found on the IRS website at: http://www.irs.gov/newsroom/article/O,,id=177063,00.html.  The following is an excerpt from the complete article.

Return preparer fraud generally involves the preparation and filing of false income tax returns by preparers who claim inflated personal or business expenses, false deductions, unallowable credits or excessive exemptions on returns prepared for their clients.  Preparers may manipulate income figures to fraudulently obtain tax credits, such as the Earned Income Tax Credit.

In some situations, the client, or taxpayer, may not have knowledge of the false expenses, deductions, exemptions and/or credits shown on his or her tax return.

However, when the IRS detects the false return, the taxpayer—not the return preparer—must pay the additional taxes and interest and may be subject to penalties.  The IRS Return Preparer Program focuses on enhancing compliance in the return-preparer community by investigating and referring criminal activity by return preparers to the Department of Justice for prosecution and/or asserting appropriate civil penalties against unscrupulous return preparers.

While most preparers provide excellent service to their clients, the IRS urges taxpayers to be careful when choosing a tax preparer.  Taxpayers should be as careful as they would be in choosing a doctor or a  lawyer.  It is important to know that even if someone else prepares a tax return, it is the taxpayer who is ultimately responsible for all the information on the tax return.

Helpful Hints When Choosing a Return Preparer

  • Be cautious of tax preparers who claim they can obtain larger refunds than other tax preparers.
  • Avoid tax preparers who base their fee on a percentage of the amount of the refund.
  • Use a reputable tax professional who signs your tax return and provides you with a copy for your records.
  • Consider whether the individual or firm will be around to answer questions about the preparation of your tax return months, or even years, after the return has been filed.
  • Review your return before you sign it and ask questions on entries you don’t understand.
  • No matter who prepares your tax return, you, the taxpayer, are ultimately responsible for all of the information on your tax return.  Therefore, never sign a blank tax form.
  • Find out the person’s credentials.  Only attorneys, certified public accountants (CPAs) and enrolled agents can represent taxpayers before the IRS in all matters including audits, collection and appeals.  Other return individual tax preparers may only represent taxpayers for audits of returns they actually prepared.
  • Find out if the individual tax preparer is affiliated with a professional organization that provides its members with continuing education and resources and hold them to a code of ethics.
  • Ask questions.  Do you know anyone who has used the tax professional?  Were they satisfied with the service they received?

Reputable preparers will ask to see your receipts and will ask you multiple questions to determine your qualifications for expenses, deductions and other items.  By doing so, they are trying to help you avoid penalties, interest or additional taxes that could result from an IRS examination.

Further, tax evasion is a risky crime, a felony, punishable by five years imprisonment and a $250,000 fine.