It’s that time again, and tax preparers are sending up flares because there are changes impacting the tax-return landscape that we all navigate every year. Inked into law last year, the Working Families Tax Cut, aka the One Big Beautiful Bill Act, brings new regulations with quite a few adjustments to the tax-time paper chase.
Be sure to check with your tax-prep person, but the bottom line is that Americans still have to keep track of everything in order to stay on the straight and narrow with Uncle Sam. The IRS website outlines a need-to-know list that includes new deductions and a lot more.
The Woodlands City Lifestyle asked Melanie Bush, owner and founder of Better Bookkeepers Inc., for tax prep reminders as April 15 approaches:
TWCL: What key forms should we gather before seeing our tax preparers or CPAs?
MB: Make sure you have collected all the requisite forms such as W2s, 1099s, 1098s, etc.
TWCL: When we receive all the forms, are they in their final format?
MB: Often your investment forms may linger. For example, the IRS requires your investment companies have preliminary forms mailed by February 15, but they may not yet be final. It’s crucial to get your preliminary form to your CPA, so they may start and then follow up with the final form.
TWCL: What kind of bookkeeping should we finish before seeing our tax preparers or CPAs?
It’s important to ensure all of your bookkeeping is complete and final. Your tax liability could change drastically if you have not reconciled all your accounts and ensured proper coding. Most CPAs insist on proof of reconciliations in addition to your Profit and Loss, Balance Sheet, and Trial Balance. The easiest way to handle this is to contract with a bookkeeper for regular monthly maintenance of your business.
TWCL: Do personal life changes impact our tax returns?
MB: The most important element is communication. Your tax preparer or CPA can only do what is communicated to them. If you had any major changes in your personal status that’s key information (marriage or children), but also any major purchases (cars, boats, etc). These items affect your return. If you sell assets or you start a new investment account, they need to know. As with everything in life, clarity in communication is key.
Tote These Forms Into the Tax Office
Tax prep squads are reminding Americans to keep these handy when rounding up forms and lugging them into the tax office: Photo ID, Social Security cards, Social Security Number verification letters, or Individual Taxpayer Identification Number assignment letters, plus birth dates, for yourself, your spouse, and any dependents. And don’t forget bank account and routing numbers for checking or savings accounts at a bank or credit union, prepaid card (check the website listed on your card for deposit instructions), mobile apps for sending and receiving money, the past two years’ tax returns if you have them, and IP PIN if you have one.
“The most important element is communication. Your tax preparer or CPA can only do what is communicated to them,” says Melanie Bush, owner and founder of Better Bookkeepers, Inc.