Did You Hire The Right Bookkeeper?

Imagine this scenario: you currently use a bookkeeper you love, who seems knowledgeable and who provides regular reports to you and financial statements to your CPA for the preparation of your tax return. To the best of your knowledge, everything is great.

A few years into business your tax return is randomly selected for audit. You feel you have little to fear as the tax return filed by your CPA lines up perfectly with the reports from your bookkeeper. After all, you hired two professionals you feel you can trust!

However, as your CPA begins reviewing the details of your books in order to represent you in the audit, it becomes apparent that the job your bookkeeper has done is far from thorough and perhaps not even all that accurate. Your CPA informs you that this audit may end with your business paying thousands of dollars in penalties and interest.

How did this happen? Maybe your bookkeeper failed to ask you the right questions, or perhaps their pleasantness or professional demeanor masked inadequate experience. In any case, it seems your bookkeeper did not know enough about your industry or the ever changing tax code, and now it’s costing you money.

You may think that this example is extreme, but over the last 26 years we have found ourselves representing some of our clients under these circumstances in audit situations. Often, a closer look at their books has revealed major errors which were not readily apparent on year end reports and without access to their accounting software.

Finding the right bookkeeper can be a challenge for a business owner. This is especially true since many bookkeepers (even some with years of experience) have only limited tax knowledge. The large majority of these bookkeepers tend to focus on the details of the business at the expense of the big picture.

This means there are many bookkeeping services which seem to do an excellent job but, in reality, open up their clients to potential problems with the IRS or other taxing authorities.

It is with this insight that Alfano & Company LLC offers clients all-in-one accounting services from bill pay to bookkeeping to payroll to tax preparation. A business owner who works with one of our in-house bookkeepers will enjoy the following benefits:

  • Their books are triple checked by qualified tax professionals
  • Potential problems are identified and handled before they become costly
  • Reports and financial statements are demystified
  • Prepared for a worry free tax season
  • Thorough planning, including answers to questions such as:
    • How can I improve my cash flow?
    • How can I increase my profit margin?
    • Should I incorporate?
    • What marketing strategy should I pursue?
    • How much will it really cost me to hire employees?
    • How is my business really doing?

 

If you have struggled to find qualified, reliable bookkeepers to produce thorough, accurate, and detailed books or if you would like to experience the peace of mind of knowing your books are being maintained by true professionals then we should talk – you deserve better.   E-mail us at reconciled@alfanocpa.com to schedule a complementary consultation.

If you have confidence in your current bookkeeper but are unsure as to how to truly assess the quality of their work, we can help!  E-mail us at reconciled@alfanocpa.com and we can discuss scheduling an in-depth review of your books.

You have enough to think about – having the right bookkeeper on your side can ensure that the numbers don’t drive you crazy!

Liana Haydin, EA

Why You Should Choose Email over Phone Calls

There are several ways to communicate with your clients, but the two most popular options are phone calls and emails. While there are certainly pros and cons to both choices, listed below are 5 reasons why emails have the advantage.

1.You can’t review a phone call later.

Have you ever gotten off a phone call only to realize you don’t quite remember what the other person just said? There is no easy way to simply re-hear your last conversation. Emails have the advantage of being permanent and searchable. No matter how long it’s been since you received an email you can always, and easily, find it and read it again.

2. Phone calls require immediate responses.

Have you ever been asked a question and felt on-the-spot to immediately reply? That’s exactly what happens during phone calls! You can’t be an expert at everything, and every now and again you’ll be asked a question that you don’t know the answer to. If you were asked that question in an email though, you would have time to calmly do some research before responding. Doesn’t that sound much more relaxing? Not only will you be at ease, but your client will receive a much more thorough, and accurate, answer and they’ll view you as a trusted source of information.

3. Phone calls interrupt your work flow.

Have you ever been – ring, ring, ring? Wait, what was I saying? Phone calls easily interrupt your train of thought and your productivity. By taking every call that comes in you’ll find yourself never being able to finish your important tasks that day, instead focused on those who called. With emails you can set aside certain times of the day to check your inbox and deal with any items of urgency, while saving the other emails for a later time. This will ensure all of your clients receive your most focused attention and you are as productive as possible.

4. Phone calls can have bad reception.

Huh? What did you just say? No matter how much technology improves it seems the person on the other line is always hard to hear. Not only is it frustrating for both parties involved, but you can be sure that items are being lost in translation. You can make it easier for everyone for clearly stating what needs to be said in an email. The client on the other end will easily be able to “hear” you when they can just read your words.

5. Phone calls can be much less efficient.

Have you ever found yourself caught in a round of phone-tag? Unfortunately the person who you need to talk to just happens to be unavailable every time you call and you keep missing their calls. By choosing email over phone calls you know that they will receive your message at a time most convenient for them, and you don’t have to find yourself leaving numerous voicemails just waiting for them to call you back.

At Alfano and Company we are always happy to hear from clients! We are here year-round for your tax and accounting needs, so never hesitate to email us. Click here to meet our team and get our email addresses.

Micalah Bowden, Office Manager

Top 10 Questions to Ask a Tax Preparer

It’s tax time again and you need someone to prepare your tax return! You may google “tax preparation services” but when a list of 10 different names pop up, how are you supposed to know who to choose?

It’s not an easy task finding a preparer who you can trust to accurately and efficiently prepare and file your tax return, but it’s certainly an important one!

Maybe you decide to take a chance and schedule a meeting with one of the 10 preparers you found on Google but once you meet them, how can you be sure that he or she is the right preparer for you? Ask them the following questions, and pay close attention to their answers:

Do you have a PTIN (Preparer Tax Identification Number)?

Anyone who prepares federal tax returns for compensation must have a valid PTIN before preparing returns. Without this identification number a tax preparer is not allowed to file your tax return. This should be the first item you check when interviewing a tax preparer!

What is your tax background?

Is your new tax preparer a Certified Public Accountant (CPA), an Enrolled Agent (EA), or do they not have any formal credentials at all? Ask about what they do and why they’re qualified to do it. You may also want to find out how long they’ve been preparing tax returns. If you’ve got a complicated tax situation it may not be the right year to choose the preparer whose just getting started in the tax preparation industry.

Do you know how to file this tax return?

Not every preparer will have experience filing every type of tax return. One preparer may only file 1040s and another might be an expert at filing corporate tax returns. Ensure they have experience filing the types of returns you need to file before choosing them. You don’t want to be a new preparer’s tax return guinea pig!

Do you know the filing requirements of the states where I will need to file?

Not all state tax returns are created equal. While your preparer may be experienced in filing state tax returns for the state they are located in, they may be unsure of the requirements necessary in the remaining 49. If you’ve moved states in the last year or work in a different state than you live, ensure that your tax preparer knows how to handle your specific tax situation.

Do you have qualified support staff?

Some tax preparers choose to work on their own while others have a full team of qualified professionals behind them. By choosing the tax preparer with competent support staff you’ll be sure that someone is always available to take your call and answer your questions even if your tax preparer is busy working on tax returns. It will ensure that your return will get prepared and finalized quickly as your preparer will be able to focus on your return. It will also be likely that you will find someone capable of handling any other accounting needs you have, such as bookkeeping or IRS representation, within that tax preparer’s accounting firm.

Can I file electronically?

Filing electronically is the way to go! Not only is it the fastest way to get your refund and typically results in fewer math errors, but it may also be required: a paid preparer who prepares and files more than ten tax returns must file returns electronically unless the client opts out. Ensure your new tax preparer is going to be filing your return electronically before selecting them!

How do you determine your fees?

Fees will typically be based on the complexity and time required to file your tax return. However, be wary of preparers who base their fee on a percentage of your anticipated refund, as they will have an incentive to encourage inappropriate credits and deductions – not to mention, this pricing structure is illegal! Similarly, by law a tax preparer cannot base their preparation fees based on how much they need.

When will I receive a copy of my tax return?

Your paid preparer is required to provide you with a copy of your own tax return which you must retain for your own records. If a preparer is hesitant to let you know when you’ll receive a copy of your return, it may be time to search for a new preparer.

Are you available year-round?

Filing taxes can sometimes be seen as a seasonal profession and many preparers decide to disappear once the filing season is over. However, you may find you have additional questions or receive a notice from the IRS later in the year. You’ll want to be sure your preparer is reliable and will be able to provide you with accounting services year-round.

What happens if I get audited?

You might not want to think about getting audited, but it can happen. Will your preparer handle the audit with the IRS on your behalf? Or will you need to fend for yourself? Make sure they are qualified to represent you before the IRS before choosing them.

Don’t be hesitant to ask your preparer these, or any other, questions. Finding the best tax preparer for you will require some time and effort, but it will be worth it once you build a trusting and long-term relationship with.

If you’re looking for a tax preparer this year and would like to hear our answers to the questions above, please email us today.

Micalah Bowden, Office Manager

Stay Secure!

 

Violated, unsafe, insecure – all feelings that victims of identity theft experience. If you’ve been there, you already know. What can you do to stay secure this tax season? How can you protect you and your family?

 Computer Safety

  • How can you keep your computer from being an invitation to cyber criminals? Virus protection is a must! To those procrastinators out there: get virus protection that automatically updates.
  • Your personal information is your identity, so don’t leave it lying around.
  • Do you use the same password everywhere on the internet? Don’t do that anymore. That’s like inviting a cyber criminal over for dinner. Changing your passwords every so often won’t hurt either.

No ‘Phishing’ Allowed or Malware

  • The IRS will never you via email, text, or phone. The IRS will never contact you via email, text, or phone. The IRS will never contact you via email, text, or phone. (I think you’ve got it!)
  • You’ve always told your children don’t talk to strangers, so don’t download attachments from people you don’t know.
  • Have your pop up blocker ready to attack!

Protect All that is Personal

  • Leave your social security card at home in a fire-proof safe.
  • If you must email sensitive documents: encrypt, encrypt, encrypt.
  • Shred any important documents before trashing them.
  • If entering private information on a website, check to make sure the site is secure -https//- is an order.

 

Applying these points will keep you, your family, and your identity safe and secure. If you ever have doubts they’re probably for good reason. If you have been contacted by the IRS and have any doubts, call us or check out this publication. Stay safe!

Laura Boykins Marketing Coordinator