Five Stone Tax Advisers' Take on an Important Tax-Related Article:
The IRS will only be responding to a very limited number of phone calls for taxpayers that have questions about their 2014 tax returns. For the first time, the IRS will be implementing provisions of the Affordable Care Act and the Foreign Account Tax Compliance Act that correspond to data-matching and monitoring systems. This means that if a taxpayer gets it wrong on their 2014 tax return (see DIF score and audit risk), they will be audited (via computer of course). Taxpayers need to develop a comprehensive approach to the 2014 filing season that includes the following:
(1) Document Gathering – What documentation will be needed to complete the 2014 tax return? Where do you get it from?
(2) Trusted Advisor/Preparer – Who will be preparing the return? Do you trust this person to be available for representation should the return be audited? Does the preparer or representative have the proper skill and knowledge base to for new compliance items like the ACA and FATCA?
(3) Timing – Do you need to file before April 15th or would it be better from a document gathering perspective to file an extension and wait until the middle or latter part of the year? Have you had a previous resolution with the IRS like an offer in compromise, installment agreement, or offshore voluntary disclosure? If so, you may have a heightened compliance burden for the 2014 tax return. Are there planning strategies that you failed to implement in 2014 that need attention and implementation early in 2015? Does your advisor/preparer offer tax planning, pro-forma tax return review or legal advisory services (for those that have small to mid-size businesses)?
As a federally authorized tax practitioner, my personal recommendation for taxpayers is to make a very specific and tailored personal checklist for both the 2014 tax return and 2015 tax planning. Using that checklist as the foundation of your tax related needs. You will quickly find that it will be your compass that will point you in the proper direction to find the right trusted advisor and keep you honest when it comes to timing triggers and document gathering.
About Five Stone Tax Advisers
Five Stone Tax Advisers has years of experience negotiating directly with the IRS to get the best possible outcome. Our Tax Preparation and Planning unit has a team of tax attorneys, certified public accountants and enrolled agents that form a single sourced point of contact to ensure you stay compliant and pay less taxes.