How to Verify Tax Prepare Credentials

Every year it seems that tax preparation gets more complicated. Since there have been more changes to the tax code this year choosing your tax prepare is even more important. Whether you are an individual or a small business owner filing as an individual, you need to read this article to make sure that the tax prepare you choose will have your best interests in mind.

Whether you are using the tax preparer from last year for your income tax return or are planning on hiring a new one, be sure to thoroughly evaluate them. There have been more changes to the tax code this year than perhaps any year in history, so having the right tax preparer is extremely important.

Here some guidance on how to evaluate a tax prepare 

Verify Their Tax Credentials

When you first meet the tax prepare, look for a CPA or Enrolled Agent license in their office. If you don’t see a license, then red flags should immediately go up but be sure to first ask if they have a tax or accounting license. If they don’t, then you should not use them for any type of tax work. If they do, quickly write down their license number so that you can verify them later.

• Verifying CPA Licenses 
• Check the AICPA List of State Boards of Accountancy or contact the state board directly. 
• Verifying Enrolled Agent Licenses 

Check the National Association of Enrolled Agents or contact the IRS directly. The databases will list the status of the licensee and if any disciplinary action has been levied against them. If you cannot find the preparers in the database, don’t be alarmed yet, first contact the state board or the IRS directly.



                                           



Check the Database Again

Even, if you are using the same tax preparer from last year, you should also check the database again as their status can change from year to year.

They Should Also Be Evaluating You
It is a bad sign if the preparer isn’t asking any of these types of questions during the meeting.

1) Who were your previous tax preparers and why are you no longer using them?

2) What type of income and expenses do you normally report?

3) Are there any previous tax liens against you?

4) How is your credit report?

5) Do you invest capital in any businesses?

6) Do you have a family with children & how many homes do you have?

7) When do you plan on retirement and what is currently included in your estate?

Just as you are evaluating the tax preparer, they should be evaluating you to reduce the risk of any issues with the tax return. So, in a way, you both should be acting as IRS agents, asking relevant questions. Also, even if you are using a tax preparer from last year, be skeptical if they aren’t asking new tax questions this year. Your financial condition can change from year to year so they should be cognizant of this possibility since it can impact your income tax return.

Ask who will be doing the Tax Work

Often times, especially at larger firms, the senior partners will have accounting staff do most of the tax work. This is okay as long as the firm has a thorough review process and the partner or senior accountant signs off on the return before it is filed. But, ask about their process and who you would be contacting if you need tax help at any time.

Ask About the Fee Structure
Most accountants charge a flat fee for an income tax return. Anywhere from $150 to $500 per return, depending on the complexity. Generally, the price tag goes up if it’s a tax return for a business. Also, ask what the fees are for consulting type tax help since those are usually set on an hourly basis and can add up quickly. Lastly, remember to ask your tax prepare if their fee structure changed at all from this year to last year. You have a right to know how much more they are going to charge for tax help, so ask! If they changed their fee structure ask why it has changed.

Inquire About Recent Changes in Tax Law

All tax prepares should be fairly familiar with changes to the tax code that would impact taxpayers. For instance, they should know whether or not it is smart for you to convert a Traditional IRA to a Roth IRA, the details of the first time home buyer tax credit and other new tax credits available as a result of the American Recovery Act. If they don’t have an opinion or seem uninformed on any of these tax topics, you should probably seek tax help elsewhere.

Ask About the Types of Clients They Serve

You want to make sure that the tax prepare has tax experience with similar businesses and individuals in a similar position to yourself. Ask about the industries they serve & the complexity of the clients they serve. You want it be the right fit. Also, if you know someone that has used this tax prepare before, you should ask them about their experience.

What they liked and what they didn’t like? This is a Starting Point have highlighted the steps you should start with when evaluating a tax prepare. However, each situation is different, so you may need to do additional due diligence to find the right prepare for tax help.

For more detail visit our website Westmidlandsaccountants.co.uk

Read More

Accounting & Bookkeeping Services for the West Midlands People

West Midlands Accountants LTD has Fast and very efficient IT savvy ways to process your records no matter how organized they may be. Then we have great time-saving clever ways to keep your records up to date in the future. West Midlands Accountants LTD aim to remove the stress.

• Tax Returns in Birmingham and online Tax Returns 
• Company formations online and other accounting needs 
• Company and Trust and SMSF setup 
• Bookkeeping Services in Sydney 
• MYOB, QuickBooks accounting software setup installation 
• MYOB experts, we are Debtors and Creditors data entry and management 
• Bank and Credit Card Reconciliation 
• Payroll, Superannuation processing 
• Preparation and lodging of BAS, IAS & FBT 
• Fixed Asset Register and depreciation 
• Weekly and monthly P&L, Balance Sheet and Cash flow reports 
• Budget v Actual comparisons 
• Bookkeepers & Accounting can streamline your Payroll in Birmingham savvy ways that will save you time and dollars. Reduce the cost burdens of doing the payroll yourself. 
• In-house at your place or remotely 
• Pay as you go (PAYG) MYOB and QuickBooks Professional Partners 

MYOB and QuickBooks Training, Installation Professional Partners, which means that we are recognized professionals that can, offer businesses products, updates and complete ongoing support. Initial audit of your existing systems. 

Monthly P&L analysis

You’re Place or Ours? If you’re a Small to Medium sized business, bookkeeping can be a time consuming challenge. It’s too much to handle yourself, but not enough to justify a full-time bookkeeper/accountant.

We provide Online Bookkeeping Services & Accounting Services in our office, remotely or at your place. Whether MYOB or QuickBooks our experienced people will help. We give you:

• A free one hour initial appraisal / consultation 
• Peace of mind 
• MYOB, QuickBooks experienced personnel 

We provide both onsite and offsite Accounting/Bookkeeping services. If you would like to talk to us about what solutions we have you can contact us.

Read More

How to Find The Cheapest Merchant Account For Your Business

Choosing the best merchant services for your company is a complicated process. Factors such as customer service, account fees, transaction rates, terminal equipment, and the network are all important pieces to making the correct decision. If you have already begun doing your research into merchant account processors you have likely already considered or looked into a number of credit card processors. If you are looking for comprehensive Merchant Warehouse reviews I highly recommend you check out WestMidlandsAccountants.co.uk. Unlike other review websites this site does a full breakdown of all the categories that small business owners should look into. Along with the rates and fees the processors advertise covered, but also the lifetime costs merchant can expect to see (ie any hidden charges). They also compare customer service and the treatment of their customers once you’ve signed the contract.

                          


If you are looking to do your own research independently then I have some recommendations that you should consider before finalizing your decision. Filtering through the industry terminology and sales techniques that credit card processors use, involves first knowing what defines a quality merchant service provider. In order to do that you must first become aware of the various ways that merchant service providers handle the transactions for your business, whether they are attempting to save you money in the process, and how/if they handle any concerns you might have. At the end of the day every company is different, and the best merchant account for you is your company may differ from another company’s.

It falls to you as a responsible business owner to review all these factors before making your decision. As a business owner you know that at the end of the day the focus will end up being your bottom line. Unfortunately this does place pressure on you as the business owner to either understand your merchant statement, or have complete faith in your merchant account processor. Making matters more difficult is that if you are new to being a business owner you don’t have the experience of reading those statements and understanding what rates you should expect. However you can aide yourself and your business by doing your due diligence and searching for qualified reviews online. After you’ve gotten a strong sense of the rates and terms to look for, your next challenge will be to figure out if what you are being told and presented in the sales process will match what you are being sold.

While one might think it is that simple, sadly this industry is full of poor contracts, and expensive cancellation fees. However you have the benefit of learning from those business that came before you, the are enough online resources and review sites for you to learn which merchant service providers have a history of misleading their customers during the sales process. On a similar vein, being satisfied with the ability for a merchant provider to handle any of your concerns as a customer should be very important. You want a merchant provider that has 24 hour customer service to handle both technical and billing concerns at any time. Dispute handling often requires prompt attention, and having a broken numeric pin pad or swipe scanner is quite costly for business. Be sure and make at least one test call to any candidates for your business, this assures you of quality of service. Quality merchant providers will often survey you for excellence in customer service following a customer call, as well.


Lastly, when narrowing down your list of possible providers, make sure that the provider does not have long term contracts. Long term contracts can quickly make a mess of your previous fees and rates calculations, skewing your bottom line and leaving you wanting out. Often such contracts include hefty termination fees as well, which force you to eat a loss when you find a better provider.

At West Midlands Accountants LTD, Accountants services panel realize that every company has unique requirements. And that your payroll services must be flexible enough to accommodate these needs

Read More

Types of Accounting Services Providers

All accountants are not created equal. This guide explains the basic types of accounting professionals so that you’ll be in a stronger position to choose a person or company for this vital role in your business. As a general guide ensures that the professional that you select is a member in good standing with a relevant professional body.

                       


Bookkeeping Services

Bookkeeping is defined by Wikipedia as the process of recording financial transactions. To this end bookkeepers are not really accountants but do play an important role in the process. Generally an accountant’s hourly rate will be higher than that of a bookkeeper so utilizing a bookkeeper for the daily recording and assembling of financial information can be quite cost effective.

Tax Agents
Tax agents provide accounting services that are predominately focused on tax issues. At the lower end, companies like West Midlands Accountants LTD can provide cost effective service to complete tax returns for simple situations.

CPAA Certified Practicing Accountant or Certified Public Accountant is a qualified and experienced professional that belongs to a recognized body. CPAs are required to maintain continuing training and development and to adhere to guidelines and standards to ensure that they offer the best possible service to their customers.

Chartered Accountant (CA)
A Chartered Accountant is also an experienced and qualified professional. The difference between a CPA and a CA is the recognized body that they belong to. Although there may be some differences to CPAs, essentially they are also held to high standards. The key when selecting an accounting service is to match the experience and expertise of the accounting provider to the needs of your business. For example if you have a small business then the expertise and approach of a top 5 accounting firm, whilst being excellent, may not be ideally suited to your needs.



West Midlands Accountants Panel of accountants offers a wide range of services whether you're a small business, partnership, sole trader or a limited company. Our panel of accountants offer Services are; Business start ups Services, Taxation advice Services, Online Bookkeeping Services, VATAnnual returns, Payroll Services, Sage accounting, Personal taxation, Self assessment and more

Read More

The 9 Common Tax Audit Triggers – Part 2

5. Claiming Business Losses Every Year

Business losses are part of the small business world. The first few years are tough and sometimes you’ll go through a rough period after enjoying profitable years. However, if you are constantly claiming losses, year after year, you’ll be on the IRSs radar. They might assume you’re taking deductions you’re not entitled to or under-reporting your income.

6. Filing a Schedule C

Most small businesses report their income and expenses on a Schedule C. This form does increase your odds of being audited but don’t let the fear of an audit prevent you from filing this form. One way to avoid filing this form is to have your business setup as a corporation. This can have its own set of issues but you won’t need to file this form anymore.

7. Excessive Entertainment or Charitable Deductions

Some business owners feel entitled to deduct entertainment or deduction expenses and if they are legitimate and fall within the guidelines of the IRS than you should absolutely take those deductions. Taking your family out for dinner or donating to your local religious organization for a purchase of a piece of art is not an allowable deduction. If your tax return has higher than average entertainment or charitable deductions, this will set off an alarm with the IRS and a possible tax audit will follow. For this reason, if you are going to be taking large deductions of the kind listed in this section, make sure you have excellent records. To take the deduction for entertainment you must substantiate where it occurred, with whom, and for what purpose. Deductions of higher than $75 must be accompanied by a receipt.

8. Claiming Your Vehicle As 100 Percent Business Use

Most people get confused when it comes to properly deducting your auto expenses. Basically there are two ways to do it. The choice is based on which one gives you a higher deduction. You can use the IRS standard mileage deduction or the actual expense. You can’t deduct both of them. Finally, if you claim 100% deduction of your automobile or you’ll need to have all records on hand. This deduction is scrutinized quite a bit. When deducting for business use of a car, you’ll have to choose between the IRS standard mileage rate and actual expenses. Deducting both of these on your tax return will bring the IRS knocking. In addition, if you claim 100 percent business use on the depreciation form for your vehicle, you’ll need precise records that include mileage logs, dates, and the purpose of every trip.

9. Drastic fluctuations in income from year to year. 

This one is hard because plenty of small businesses have had an unusually good or bad year here and there. If you’re reported taxable income this year is dramatically higher or lower than in previous years it might send a red flag to the IRS. Fluctuations in income can signal that something went unreported in prior years. However, if you keep proper records and have a good bookkeeping system, you don’t have to worry. As long as you can substantiate your expenses and income, you can be ready even if the IRS does have to audit your books.

Have questions about your taxes? Contact us to discuss them. 

West MidlandsAccountants LTD, we are here to offer you support, help you save time, and ensure your records are up to date. Ultimately, we can help you save money. Contact us by phone at 01217 665 477 or email info@westmidlandaccountants.co.uk for more information

Read More

The 9 Common Tax Audit Triggers – Part 1

1. According to statistics, just 0.9 percent of people who make under $200,000 were audited last year, compared to 10.9 percent of those who made over $1 million. If your schedule C shows more than $1 million in sales, the odds of being audited increase substantially. With such increased odds of being audited, you must keep meticulous financial reports.



2. Large deductions that look out of proportion to your sales or income. Deductions that reduce your taxable income substantially are a red flag if they seem too high when compared to your income. The IRS uses tables to decide if your deductions are too high for your income bracket. But don’t go searching for these tables because they aren’t made public. We know that at times, those out-of-proportion deductions are legitimate. For instance when you’re just started your business or during times of slow growth. For this reason, you must keep track of all your deductions and have detailed records if you ever need to substantiate them.                                               

3. Reporting rounded number show likely is it that your investment returns were exactly $1500, or that your mortgage interest deduction was $12,000? Reporting too many round numbers are deemed fishy by the IRS and can trigger an audit. If you made $72,532.65 don’t report $72,500. This kind of reporting is deemed inaccurate and sloppy and if you are found to be inappropriately rounding in one area the IRS will assume you’ve done that in another area of the return. They’ll deem the entire return questionable.


4. Home Office Deductions

Because home office deductions can be so easily abused, last year, the IRS simplified how small business owners can calculate the deduction. But to take this deduction you’ll need to satisfy numerous criteria. This deduction is a big red flag so make sure you’re satisfying every requirement, one such that the home office area be used exclusively for your business.


Have questions about your taxes? Contact us to discuss them. West Midlands Accountants LTD, we are here to offer you support, help you save time, and ensure your records are up to date. Ultimately, we can help you save money. Contact us by phone at 01217 665 477 or email info@westmidlandaccountants.co.uk for more information

Read More

Bookkeeping Online Service

If you are good with numbers and you enjoy working with people, starting an online bookkeeping business may be an entrepreneurial idea that you may want to consider. With an online bookkeeping business, you will be able to set your own hours and have some control over your income. While setting up a bookkeeping business can be very rewarding, it does take a fair bit of exertion on your part to accomplish an outstanding work that would measure up to the expectation of most discerning clientele. Here are a few things to consider when starting your own business in this field.

Get A Good Education
While you could potentially start a bookkeeping business without doing any research, it is usually best to get your bookkeeping education first. There are a number of different bookkeeping schools that you could attend in order to receive a top-notch bookkeeping training that you would need for this business. It is usually a good idea to go to a bookkeeping school where you can get a bookkeeping certification. Once you have an official recognition, customers will be more relax in doing business with you.

                             


Equipment

Once you are ready to start your bookkeeping business, you’ll need to invest in some equipment and supplies. You will need a computer that has Internet access, a printer, a scanner, and possibly a filing cabinet. In addition to buying a computer, you may want to invest in some bookkeeping software. There are a number of programs online that will allow you to handle your bookkeeping customers. This will make your job a lot easier, and help keep all of your customers records safe and secure. You could potentially get a computer and printer/scanner combo for $500 or less. Software packages also differ in price. Some of them will cost you around $50 a month in order to set up a number of customer records in your account.

Marketing

If you are going to start an online bookkeeping business, you may be required to market yourself with companies overseas to initially get a significant market share to burden the start up overhead cost of your business. To begin with, you may need a website to inform your potential clients of your services. If you can create your own website, your online business could be up and running soon maybe right after paying for the hosting service. Hiring a professional web designer can make your website look more strikingly good but may increase their cost significantly.

After creating a site to market all your bookkeeping services, you’ll need a number visitor to check your site to make them go up in search engine rankings and make your site more visible to among the online crowd. You may start bidding up jobs on freelance sites as a way to attract your potential customers. You may also start looking on pay-per-click ads on search engines like Google and Bing to get more people to come on your site. You could spend as much or as little as you want on advertising, depending on how much you money you are willing to invest.

Handling Customers

If your website is good enough at converting visitors into paying customers, it will have a better chance of growing them through time. For the mean time you need to provide the best service among all your customers and if way possible beat the competition so you can keep them hook up while expanding the scope of your services that will cover all the needs of your paying yet truly discerning clientele.

Find Experience Charted Accountants Services in West Midlands only at West Midlands Accountants LTD

Read More