It’s tax season again, which for many is a frustrating and confusing process. Local businesses like Becker Tax Service and Clearwater Tax and Accounting Service are here to help.

Tax return preparers have differing levels of skills, education and expertise, so when hiring one, a person should look into their credentials. 

 

Kelly Schendzielos from Becker Tax Service and Carol Halvorson, Judy Lashinski and Jacob Borash from Clearwater Tax and Accounting Service are Enrolled Agents (EA), the highest credential awarded by the IRS. This status means they have passed comprehensive individual and business tax return tests, have unlimited practice rights, and are permitted to represent taxpayers before all branches of the IRS. 

 

Lashinski and Borash have also undergone additional training in IRS client representation to become National Tax Practice Institute (NTPI) Fellows. 

 

When meeting with a new tax preparer, the previous one to three years’ returns should be brought along. The preparer can make sure a person is getting all the deductions they’re entitled to, and can amend returns from the previous three years if needed.

 

Halvorson recommends people keep track of deductible items throughout the year. For example, receipts are required for cash donations to charities, donations of household items and clothing need documentation of fair market value, and when volunteering keep track of out of pocket expenses and miles driven.

 

She also advises to not overlook pretax benefits, such as health care savings accounts and retirement accounts, which help to reduce income.

 

There are a few new tax items people should be aware of this year. Schendzielos advised tax penalties related to the Affordable Care Act are going up. For those without health insurance the penalty is now $695 per adult or 2.5% of income, whichever is greater, with a family maximum of $2,085.

 

Minnesota’s military pay exclusion has been expanded, and due dates for business returns have been changed, with partnerships now due March 15 and corporations due April 18.

 

The IRS has delayed refunds for people who claim the Earned Income Tax Credit or Additional Child Tax Credit refunds in an effort to fight identity theft and fraud, however people should start receiving them at the end of February.

 

Borash said identity theft and safeguarding identity has been stressed at classes he’s been attending. IRS scams are common, with callers pretending to be from the IRS saying a person owes money and must pay immediately to avoid going to jail, or that a refund is owed and bank account information is needed.

 

The IRS will never initiate contact by phone, text or social media, so if a call is received information shouldn’t be given out. The IRS can later be contacted to determine if the call was legitimate or not.

 

Clearwater Tax and Accounting has booklets from the IRS on identity theft and ways to safeguard identity available at their office for anyone looking for more information.

 

Concerning a possible property tax refund, Halvorson said it doesn’t hurt to check every year as many people suddenly qualify because of changes that have occurred. 

 

If a person gets a notice saying money is owed to the IRS, she advises them not to pay until they look into the situation, as often those notices aren’t correct. If it is, money will also be owed to the State, so an amendment will need to be filed.

 

There is a piece of good news for those who wait until the least minute to file. This year April 15 falls on a Saturday and the following Monday is a holiday in Washington D.C., so the tax deadline has been extended to April 18.

 

Lashinski said they’re available any time of the year for people to stop by and ask questions, or if they need help with tax planning. Often changes can be made before the end of the year that can help a person’s tax situation.

 

Although personal taxes is the largest part of their business, Clearwater Tax and Accounting also specializes in other areas, including small to medium size businesses, farm returns, partnerships, LLCs, and S- and C- corporations. 

 

Also open year round, Schendzielos of Becker Tax offers services for personal, business, fiduciary and estate tax needs.

 

If a person decides to prepare their own tax return, she advises to not wait until the last minute, and to do a comparison of tax programs, making sure to read the fine print as many end up not being free after the add-ons.