You may recall the 1979 smash hit, “Flirtin` with Disaster” by the rock group, Molly Hatchett. “When we gamble with our time, we choose our destiny” is a line from the song; think about how you might be able to relate.
Hello again, Lynn Spencer here. I am the co-owner and CEO of Killingsworth Spencer CPAs. Today I want to share a few things our firm is seeing with respect to new client engagements.
Prospective clients who have come to us for help in recent months are sometimes surprised after our review of their past tax returns. Our staff has uncovered some questionable business deductions and other critical errors, along with neglecting powerful deductions. When we bring these findings to their attention, the standard response is, “wow, this is what we have been used to for years, is this really such a big deal?” The short answer is yes.
Here is a partial list of flirtatious items:
No Officer Salaries
A piece of paper with ”hand-written business deductions – 20xx”
No official backup on business deductions
No clean set of business records – QuickBooks not organized or personal expenses mixed in with business.
Business balance sheet where cash, credit cards, fixed assets, etc. are not reconciled
Incorrect depreciation schedules based on asset type
Double dipping of mileage deductions on vehicles
Loss carryovers from prior year returns not recorded for current year
PTE – Pass Through Entity Deductions missed.
At Killingsworth Spencer CPAs, we take great pride in our work to assist our clients with their tax preparation needs, and we will not put our name on the return until we have confidence in the information. Ultimately, it is the client who is responsible for a tax return. If a tax preparer knowingly signs his/her name to the tax return with the realization that the information was not correct, then both are “flirtin with disaster.”
Most taxpayers want to do the right thing and not become an IRS statistic. In some cases; however, we have had to remove ourselves from the engagement. The IRS has stated repeatedly that they are ramping up audits of higher income individuals and businesses over the next three years.
If you are sick and you go to your doctor for help, would you withhold valuable information that can help to secure the correct diagnosis? Of course not. If you haven’t come clean with your tax accountant or you prefer to not listen to the diagnosis, perhaps you should take another listen to the Molly Hatchett song.
Let Killingsworth Spencer, LLC assist you with you tax preparation needs!
