This is not a question that we hear often, but I want to address it because it has led to many people seeking our services and occasionally client frustrations. I would preface this with the fact that when you are signing your tax return or authorizing your CPA to electronically file your tax return, you are doing so under the penalty of perjury that you have verified that the return is correct.
The following are the steps that you should take to make sure that your tax return is complete and accurate:
The first step starts before you receive your return from your CPA or tax preparer. It is critical that you provide your CPA with complete and accurate answers to the questions they have. If there is a questionnaire that they send you that asks simple yes/no questions, it is imperative that you complete this accurately. From a CPA’s perspective, it very difficult to prepare a great product when you are only given a partial answer. Inevitably there are the clients that don’t complete the questionnaire and then things are missed on their returns, like incorrect addresses, they forgot to tell us they had a child, sold a house, etc.
Ask to have a meeting with your CPA to review the tax return and understand what is on the tax return. From a CPA’s perspective, we enjoy going through a tax return with a client and explaining where things are and how income and expenses are reported. Take this as an opportunity to learn from us and ask questions. Quite often we can point out additional areas to look for deductions in the coming years or strategies you can use to minimize future taxes. During this meeting with your CPA dive deeper into the following areas.
- Ensure that all the information is accurate, including personal details, income sources, deductions, and credits.
- Cross-check your records. Compare the information on your tax return with your own financial and supporting documents. Things like W-2 forms, 1099 forms, receipts, and bank statements. Verify that the figures match up correctly.
- Check for accuracy and completeness. Look for any potential errors or omissions in the tax return. Verify that all the necessary schedules and forms are included. Ensure that all relevant information has been reported accurately.
Understand tax laws and regulations. While you are hiring a CPA to properly prepare your tax return you should at least familiarize yourself with the relevant tax laws and regulations that pertain to your situation. This will enable you to better evaluate whether the tax return has been prepared in compliance with the current tax rules.
Seek clarification. If you come across anything you don’t understand or have concerns about, reach out to your CPA for clarification. They should be able to explain the calculations and address any questions you have.
Consider a second opinion. If you have doubts about the accuracy of your tax return, then you can consult with another qualified tax professional. They can review the return independently and provide their opinion on its accuracy. From our experience over the years, if you have doubts about the accuracy of your return, there are likely to be errors.
File and retain copies. Once you are satisfied with the accuracy of your tax return, then file it with the appropriate tax authorities. Keep a copy of the filed return, as well as all supporting documents, for your records.
In conclusion, while CPAs are trained professionals, they can still make mistakes. They may have been provided with incomplete information. In other words, It’s important to be proactive and take an active role in reviewing your tax return to ensure its accuracy. If you have any questions or want to get in contact with us, then click the link below.