Our office works with a lot of accountants. Accountants are often on the front line of the planning issues that we handle for clients. Nine times out of ten the accountants are a tremendous help to our clients, especially to those who are business owners. However, it is always prudent to know what to expect out of your accountant to ensure that he or she is being more of a help than a hindrance to your long term planning needs.
For example, one question to ask your accountant is how money paid to your family for services rendered should be reported on your or their tax returns. If you need to qualify for Medicaid, have been paying family members, and do not have a personal services agreement, the payments could be viewed as gifts, which could result in your being disqualified from receiving Medicaid benefits.
There are many areas in which your accountant needs to be adept when it comes to the preparation of your tax return(s), like understanding the tax code and the cause and effect that your tax return has on your future estate planning, financial planning, and long-term planning issues.
Washington News published an article that states in simple terms the ten tips that the IRS has for selecting a tax preparer. The tips seem like common sense, but are still often forgotten. Read the “Ten Tips on Tax-preparers.”