tax-preparation-cpa

When it comes to tax preparation for your clients, things seem to be overwhelming because of the need to handle so many accounts. Apart from the lack of information about the latest regulations, finding time for tax preparation for all your clients can be a challenge while managing your day-to-day operations. You will require some expert tips to prepare your taxes successfully.

  1. Gather All the Information

The first step for filing your clients’ us income tax return is to gather all the relevant information. This can make your task much easier and faster. When you have all the relevant documentation, you will not find things challenging and frustrating later on.

So what is the information or documentation that needs to be gathered? Here is the list:

  • Tax return from last year
  • Accounting records
  • Credit card statements
  • Bank statements
  • Payroll reports
  • Asset dispositions
  • Asset purchases
  • Information about vehicles
  • Depreciation schedules

Checking last tax return documents from last year can help you with this year’s corporate tax planning. It can be used for comparison purpose and as a guide for this year’s return. Some of the benefits of using last year’s return are as follows:

  • You will get a framework for your current return
  • Measure and compare your company’s finances with last year

  1. Separate Business Expenses from Personal Expenses

When gathering all the information for tax planning, make sure to separate your business expenses from personal expenses. When both are mixed, it can make accounting too difficult and complex. It is also possible that IRS may not take some expenses to be under the purview of business head. It is also important that your clients maintain different bank accounts for the two types of expenses.

  1. Track Client Expenses

Even before you start planning your clients’ tax returns, it is important to maintain a record of all their business expenses. The following points should give you an idea of how this can be important for the returns:

  • Cover more expenses can help you reduce their gross income and tax liability
  • Cover everything including travel, transport, office supplies, insurance, marketing and advertising, meals, legal expenses, and more
  • If you try to gather information about their expenses at the last movement, you are certainly going to miss a lot of details

A simple and effective way to track your clients’ expenses is to require them to digitize their receipts. This can involve scanning and saving all receipts. If this task seems to be difficult and time-consuming, you are mistaken. There are technology solutions to make the process faster and simpler.

When they digitize their receipts, it also helps save space and de-clutter their offices. Even if they lose the paper receipts, you could readily refer the digitized receipts to calculate all the expenses at the time of tax preparation. It also means increased safety for the documents, as the files can be saved on the cloud. It also makes things simpler for you and your clients if there is an IRS audit in the future.

  1. Hire Professional Services

While you may gather all the above-mentioned information, filing the returns and managing all the accounting functions for all your clients can still seem to be a daunting task. So it is best to consider tax preparation outsourcing. It can be overwhelming for your office to handle the tax returns of all your clients. Finding the time and manpower for the tasks can be expensive for your office. This is where professional services can prove to be of great assistance. Hiring tax preparation services during that time of the year can be an economical choice.

  1. Keep Track of the Tax Dates

Even if you plan on tax preparation outsourcing, you should know about the deadline for filing the returns for all your different types of clients. The IRS tax calendar provides information about the deadlines for filing returns for businesses. It will be required to keep track of the dates for different types of forms, including the following:

  • Filing W2s
  • Filing W9s
  • Filing return
  • Making estimated payments

Keep in mind that the tax dates can be different for different types of businesses, professionals, and individuals. You should keep track of the dates well in advance as part of your tax planning.

  1. Making the Estimated Payments on Time

If a client’s taxes are expected to be more than $1,000, the business is required to pay quarterly estimated taxes. As a CPA, it is important for you to keep track of these payments. There are 2 key benefits of paying estimated payments on time of your clients:

  • It can help minimize the returns they have to pay in the long-term
  • If their business is doing well but they don’t pay the quarterly estimated taxes, they can attract fines from the IRS

The burden of having to pay a large accumulated tax bill and the fines can be difficult for many of your clients.

  1. Focus on Ongoing Tax Planning

Instead of making it a once-a-year job, accounting and tax planning should be an ongoing activity. It should be a continuous part of your client’s accounting operations. This can increase the work load on your office. You may consider tax outsourcing to further simplify the job for your company. It can help save valuable time and effort, allowing you to focus on the most important core tasks.

  1. Focus on Core Operations

One of the most important reasons companies and professionals seek CPA Services in USA, UK is for tax audits and representation in front of authorities. When you choose tax preparation outsourcing services for your office, it becomes possible to focus on most of your core functions.

This can include:

  • Preparing audited and reviewed financial statements and filing the reports with the SEC.
  • Representing your clients in front of the IRS

So make sure to follow these tips with regard to your client’s tax preparation. It is also important to rely on the latest software solutions to ensure that your clients can get the best services. Still, it will be required to seek professional help to ensure that your operations are carried out in a seamless manner without causing any delays or errors. Such a service can save you valuable time and effort. You can thus focus more on managing and growing your business by handling the core tasks.

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