Tax Season 2020

Tax Season 2020

Please read the following engagement letter and filled out the appropriate forms prior to attending your appointment.

Happy New Year! We have an interesting year ahead of us with many tax changes looming. We will do our best to keep you updated on such changes. We are here to hold your hand and help you navigate all the changes this year and beyond. With that in mind, please read our policy changes below:

  • NEW: The IRS is requiring more documentation when taxpayers claim Head of Household, the Earned Income Credit, Child Tax Credits, and Education credits. Please expect requests for documentation from us if you are eligible to claim any or all of these on your tax return. Additionally, if you have rental property, you are required to prove involvement in your rental property to claim the Qualified Business Income Credit.  At the tax conference, we were informed the IRS had made mistakes in the calculation of capital gains tax for a period of time during the 2019 tax season. The calculation error was passed on to the tax software programs so you may receive a letter indicating you are due a refund because of this miscalculation. Please provide us a copy of the letter and keep in mind that this was an IRS mistake. The IRS has asked the tax preparers not to file amended returns but to wait on the IRS to fix the returns and issue any refund due.
  • NEW: Payment for taxes is due upon completion of the tax return. We will be using RightSignature for e-signing and you will need to pay when you sign unless you pay by check or money order prior to e-signing.
  • Same as Last Year: Make sure you have received all of your forms before you drop off your tax package. In the event that you are missing a form, please call the issuer and have them send to you ASAP. If you moved, some mail might not have been forwarded. We cannot complete a tax return without all your tax documents, therefore we will not start on your return until we have all the necessary documents. Please do not bring us your tax packages in bits and pieces.
  • Same as Last Year: In order to be as efficient as possible, all tax documents for individual returns need to be in to us no later than March 16th to be filed on time. If brought in afterward, we will not guarantee you won’t be put on extension. Also, all tax documents for business returns need to be in to us no later than February 15h to be filed on time. If brought in afterward, we will not guarantee you won’t be put on extension.

***If you are buying or refinancing a new house between January-April, we would appreciate as much notice as possible if you will need copies of prior tax returns. We are sure you can appreciate how crazy-busy tax season is and when extra requests come in, it is a challenge to meet them. Since we do provide a copy of your tax return each year, we will be charging a fee of $65.00 should we need to send copies of tax returns to bankers, if you need an additional copy, etc. You will be required to sign and date a special consent for me to release information to third parties. Usually, this can be accomplished with RightSignature to keep the process moving.***

Here are some deadlines to keep things on track for all of us:

Client Organizers –January 2020

– Client Organizers will only be provided upon request. Send me an email with your request and I will upload an organizer to your SmartVault account.

– If you are a new client this year, welcome aboard! I can either send you a generic organizer or you can use the checklist (Download Here) provided to gather your documents.

1099 Issuance-Due by January 31, 2020

– If you paid anyone for services over $600 this year for your business or rental property, you are required to issue them a 1099-MISC. Included in this group would be any independent contractors used for your business or rental property, child care providers you pay directly and home health providers. The exception would be: if you paid anyone with a credit card, you are not required to send a 1099-MISC as those payments will be reported by the credit card company.

– If you paid an attorney in 2018, you will need to send a 1099-MISC for any payment over $600.

– If you would like me to file the 1099s for you, please provide completed W9s (each independent contractor should have filled one out for you), the amount you paid to each person, and what type of payment (Non-Employee Compensation, Interest, Dividends, Rent) was paid to each person. A fillable PDF W9 can be download from www.irs.gov. I will send out the 1099s to each recipient and electronically file with the IRS. Fees will vary according to the number of 1099s that need to be issued.

Quarterly Payroll Reports and W2s – Due by January 31, 2020

– It is a good idea to have me file your 4th quarter payroll reports and W2s for you as I can catch and fix any errors before final forms are mailed to employees and the IRS.

– Please call me as soon as possible to get on my schedule if you would like me to do your 4th quarter payroll reports and W2s. (If I am not already doing your quarterly payroll).

Engagement Letters – I will need a signed engagement letter from all clients this year. A letter will be available at my office or I can email to you. You may also download the engagement letter here:

Personal Tax Engagement Letter (DOWNLOAD)
Business Tax Engagement Letter (DOWNLOAD)

Consent to Use – If you need me to furnish a copy of your tax return to a banker, mortgage broker, or some other third party, I will send you a Consent form to sign and date before I can release information to a third party.

I also have an in-house Consent to Use that allows me to contact you about tax planning. This consent is part of the tax package I return to you..

Corporate and Partnership Tax Returns are due on March 15, 2020. I need to have your information by February 15, 2019, to ensure I file your return in a timely fashion. Please contact me if you need an extension.

Individual, and Fiduciary Returns are due by April 17, 2020. I will need your information by March 17, 2019, to file your return on time.

Specific Reporting Documents – Some tax documents such as K1s, HSAs, or 1099-Bs tend be issued near or after the April 17 deadline. If you expect one of these documents, please contact me and I will go ahead and file an extension just in case.

Business License and Property Tax Returns – It is a good idea to involve me in the process of filing out business license and property tax returns as localities are now cross checking their reports with tax returns and issuing penalties for underreporting information. Please let me know if you want my assistance in filing out these forms.

Looking forward to a prosperous, sparkling and successful 2020 with you!

Kim, Kelsey and Paige