company logo

We'll crunch the numbers for you!

desktop calculator
PrintPrint

How to Reduce Your Tax Preparation Fee

updated 11/27/16

The following guide will assist you in determining which documents & information to supply us with in order to prepare your return as efficiently & cost effectively as possible. Supplying the documents all at once & in an organized manner is the key to the fastest possible processing turnaround and lowest tax preparation fee. This guide is broken down into categories so you can focus on the ones which apply to your particular situation.

Health insurance coverage (applies to everyone)

Please supply us with copies of any of the following forms which apply to your particular situation. These forms contain important information which is included with the filing of your tax return & is necessary to avoid penalties for failure to have proper insurance coverage. You might have been issued 1 or more of these:

  • 1095-A - this form is used to report certain information about individuals who enroll in a qualified health plan through the Health Insurance Marketplace. You should have received this form if you acquired health insurance through the Health Insurance Marketplace.
  • 1095-B - this form is issued by an insurance company and reports information about your health insurance coverage. You should have received this form if you purchased health insurance directly from an insurance company.
  • 1095-C - this form is issued by your employer and reports information about your health insurance coverage. You should have received this form if you received health insurance coverage thru your employer.

See the Health insurance requirements video for more information.

Income reported to the IRS (applies to everyone)

Certain items of income (and some deductions) are reported by the payer (or recipient) directly to the IRS. Examples of income reported directly to the IRS are wages paid by your employer & interest income paid by your bank. It is important that we have copies of the following documents in order to make sure they are properly reported on your return & avoid possible tax notices or even an audit:

  • W-2 - salaries & wages
  • 1099-MISC - this form is used to report various types of income including payments you received as an independent contractor & rental income
  • 1099-INT - interest income
  • 1099-DIV - dividend income (also see "Stock/bond transactions" below)
  • 1099-R - retirement income from IRA's & pension plans
  • 1099-SSA - social security income
  • 1099-G - this form is used to report various types of income paid by the state of California (and other states) including state tax refunds & unemployment compensation
  • K-1 - income received from an LLC, S-Corp or partnership
  • 1098 - for mortgage interest paid on home, second home or rental property

Charitable contributions

If you made non-cash contributions of large items such as a car or furniture with a current fair market value over $500 we need specific information re: the gift such as the name and address of the charitable organization, the date of the donation & a complete description of the item(s). It is also important for us to have a copy of any receipts or acknowledgement letters you received from charitable organizations for large cash gifts or non-cash donations.

Businesses

  • Profit & loss statement for the tax year - this can be a statement produced by accounting software such as Quickbooks*, an Excel spreadsheet, or you can enter the income & expense amounts in the tax organizer. For LLC's & corporations it is also important to have a balance sheet as of the end of the tax year. If you are using Quickbooks* it is usually most efficient for us to have a copy of the data file itself so that we can access any detail information needed to properly prepare your return.
  • Form 1099-MISC(s) your business received from its customers (if applicable)
  • Payroll tax forms (if applicable) - W-2's, W-3, DE9 & 940 (or 940EZ)
  • Form 1099-MISC(s) filed by your business (if applicable)
  • If you purchased any equipment during the tax year - description of equipment as well as the cost & date(s) of purchase

*Please contact us if you need assistance in setting up or using Quickbooks. It is important for tax purposes as well as business operations to have accurate accounting records. An efficient & well organized accounting system is one of the hallmarks of any successful business.

Stock, bond & mutual fund transactions

We need a copy of the year-end statement for any stock/investment accounts you have. This statement is usually in the form of a consolidated statement which includes the various forms required by the IRS to be issued by the broker: Form 1099-DIV, 1099-INT & 1099-B. This year-end statement usually will include a listing of any stock/bond sales which occurred during the tax year (including the original cost basis & the gain or loss on each transaction).

Rental properties

  • An accounting of the rents received & expenses on each property. You can use the tax organizer to give us this information or supply us with a P&L prepared by yourself or a management company.
  • List of major repairs & improvements made to the property during the tax year - dates, amounts & details of work done.
  • Form 1098 showing mortgage interest paid on the property (if applicable)
  • Form 1099-MISC showing rents received (if applicable)
  • If this property was just acquired - the closing escrow statement for the original purchase of the property (if possible) or the details such as date and amount of purchase.

Sale of real estate

  • Closing escrow statement for the sale of the property
  • Form 1099-S showing sales price (if one was issued by the escrow company)
  • CA Form 593 - issued by the escrow if California state withholding tax was withheld on the sale via escrow
  • List of major improvements made to the property the entire time it was held by you - dates, amounts & description of work done.
  • Closing escrow statement for the original purchase of the property (if possible) or the details such as date and amount of purchase.
  • List of major improvements made to the property the entire time it was held by you - dates, amounts & description of work done.