Richard A. Lindsey, CPA

Lindsey & Waldo, LLC – Certified Public Accountants

  • Mar 23

    Generally, I’m a big fan of automation. I certainly try to employ as many systems in my business as I can since it generally makes me more efficient. But not always. The same holds true for you. Do NOT “automate” your tax return preparation process with off-the-shelf software. Especially of the “free” variety.

    Really, on what planet did you think they were actually going to give you their “best stuff?” How would they make any money and stay in business?

    We have to clean up so many mistakes made by these products (and their users), that I cannot, in good conscience, recommend them.

    Yes, I’m obviously biased. But the facts are the facts. If you get stuck, if you don’t understand something, they will not help you. Customers of Turbo Tax rank the company’s customer service as disappointing. Take a look at the customer service score card below. Check it out yourself at http://www.customerservicescoreboard.com/TurboTax.

     

    Customer Service Scoreboard

  • Mar 9
    1. I was a first time homebuyer or long time homeowner and received a check because of it. If you were a first time homeowner and closed on your house in 2008, your $7,500 credit must be paid back via your tax return. Also, if your residence has changed since you bought your new house, part of your credit must be repaid.
    2. I rolled over my IRA into a ROTH. While this helped you in the long run, the money that was rolled over has to be reported on your tax return. Many taxpayers opted for a 2 year deferral. Part of your rollover may need to be included on your tax return.
    3. My child, who is away at college, has a part time job even though I am able to claim them. Sometimes, part time jobs may put your college age child over the threshold for earned income making it necessary for them to file a tax return. You can still claim them, however, it may be required that they too file a tax return. We also need to confirm, if they have already filed a tax return, they indicated they were dependents of another person-YOU!
    4. I sold some stock this year but only had a small loss. Although you may think since you had a small loss, you don’t want to worry about calling the broker and getting the statement. The broker reports only the cash you received to the IRS. It is up to you to inform them that you actually had a loss. Otherwise you will get a notice of tax deficiency.
    5. I am 70 ½ but didn’t take my Required Minimum Distribution from my IRA this year because I forgot. As people, we understand life happens and things get forgotten. However, by being proactive and informing the IRS that you forgot and it is an honest mistake can often help eliminate the 50% penalty that goes along with forgetting. Yes, 50 PERCENT TAX PENALTY. It is important to let us know so we can beg for forgiveness on your behalf.

    You may be thinking on some of these, “Really? You want me to tell you about that so I can owe more taxes? Why in the world would I do that?” Well, let me tell you why. In each of the above scenarios, the IRS already knows it happened! That’s right, there are reporting requirements for each of these and the IRS WILL contact you for their money. It is much better to handle it correctly to start with than to owe more later.