Tips on How to be a Great Individual Tax Client

We’ve just sent out 2021 individual tax organizers. Clients use the organizer in different ways and complete to different degrees –which is fine. Some are meticulously complete while other organizers are return sealed in the mailing envelope untouched by human hands.
The most important part of the organizer are the questions on the first few pages. Do you have foreign bank accounts or Crypto currency? Spend a few minutes browsing those and making notes. Second, make certain contact information is up to date – address, phone numbers and email addresses.
After that, the level of completion is up to you.
  • Note on the front page of the organizer if you are missing information.
  • Use the tax organizer as a guide – you don’t have to complete, just include the supporting documents when the organizer is returned.
  • Dividends and capital gain distributions – this section can be messy to complete. Just including the 1099’s or year-end broker statement and we’ll handle from there.
  • Capital gains – don’t complete the capital gains section if the activity is included in your brokerage 1099. If you sold other assets, like land, or rental property include the closing statement. We’ll also need a purchase date and cost basis.
  • If you sold your home, include the closing statement. Any gain is generally not taxable but there may be deductible property taxes.
  • Don’t wait until the last minute. We need time to accurately prepare the return.
  • Generally, we’d rather have all the information before we begin but if the deadline is looming, we may ask you to bring in so we can get started.
  • Medical is generally not deductible. For federal, medical expenses must exceed 7.5% of adjusted gross income (4%, Alabama). So unless you have substantial expenses probably no deduction.
Our internal process is to review the organizer and supporting documents, scan and process the return. After reviewing, we may come back with additional questions or ask for additional documentation. Please:
  • Respond timely – without all the information, processing stops
  • Assume there is a reason we ask a dumb question
  • Communicate freely. It’s better to have too much information rather than too little enough. One fact can change the outcome.
  • Respond completely – if we are missing 4 items and you send 2, add a note when we should expect the rest.
To meet the filing deadline, we request all information tax planning.
If you have questions, please give your Dent Moses advisor a call.