What clients are asking CPAs about 2012 tax returns and 2013 taxes.
Tax season, or the weeks leading up to April 15, can be a frustrating time as you try to organize a lot of documentation that you don’t necessary track over the course of the year. As we enter the home stretch, I thought it might be helpful to review answers some of the great tax questions that clients are asking this year.
Answers to some common 2012 and 2013 tax return questions
Just to clear the air, the #1 question we receive is, “Will I get any money back?” Since the answer to that varies by each individual client, here are some other questions and answers:
- What if I can’t meet the April 15 deadline? You can request an extension by filing Form 4868. The form itself is simple, and it gives you up to 6 additional months to file. This does not extend the time to PAY taxes. It just gives you longer to file your tax returns. You’ll need to give us adequate notice so we can calculate how much you owe, and you still need to pay your first quarter 2013 estimated taxes by April 15, if applicable.
- Are refund anticipation loans a good deal? NO! I see strip mall tax preparation services advertising these loans all the time. This is where they really make their money. Between high interest rates and fees, you may lose up to 75% (or more) of your refund. A good CPA can help you speed up your real refund with electronic filing and direct deposit – for no additional cost.
- Will my taxes change in 2013? If you receive a paycheck, you have probably already noticed the increased tax withholding due to the recent tax law changes. If your income is above $300K, plan on paying more taxes in 2013. While preparing 2012 tax returns, we also look at 2013 estimates to ensure that each client is adequately planning for this additional tax liability.
- How can I pay less 2013 tax? This is usually the next question after #3 above. There are only a few options left, including oil and gas exploration and tax free municipal bonds. There are also some options, like film credits, that can reduce your Georgia tax liability. Please talk to us before you invest so we can give you an unbiased opinion. By the way, you still have time to reduce your 2012 taxes by funding your retirement plan (IRA, SEP, etc.) before you file your tax return.
- Is there anything else we should discuss? This is my favorite question. While all of your records are up-to-date and sitting in front of us, this is a great opportunity to conduct a financial health review. Let’s make sure that you are saving enough for the future, and that your money is invested in the right ways. CPAs are independent, so we’re not beholden to any specific investment options. We can help you make better decisions, or recommend other financial specialists who can.
Trust a highly trained CPA with your tax returns
Remember that your CPA is highly trained, independent financial consultant. The tax laws are complicated, and the 2013 changes have made them more convoluted than ever before. Don’t ask for audit trouble by bringing your taxes to someone waving a sign on the highway. Our CPAs do this for a living, not a part-time job.
Neal Bach, CPA