Free Review of Returns Because Mistakes Happen More Often Than You Think

This tax season included a surprising number of amended returns from previous years.  The most common mistakes are issues with childcare and college expenses, cost basis and tax-exempt situations with investments (found on Schedule D), small business expenses (Schedule C), and misunderstanding of allowable itemized expenses.

But I am not alone in seeing these issues. The US Government Accountability Office (GAO) prepared a limited study on paid tax preparers which showed 55% of tax returns are prepared incorrectly.  The study also revealed that preparers with credentials such as required testing and continuing education had higher accuracy than those without credentials. 

Oregon and Maryland are the only states to require testing and continuing education of paid preparers.  For residents of other states, the only way to ensure that your tax preparer has credentials is to use an enrolled agent, CPA, or tax attorney.

Many people believe that the software will catch all money saving opportunities and will ensure accuracy. Unfortunately, the software can only accurately calculate the data that is entered.  Incorrect entries are rarely flagged by software. The software companies focus on the federal taxes, then highly populated states like New York and California, and then the remaining states. With a limited effort on less populated states, state tax returns have a greater chance of errors than the federal return.  In 2010, I discovered a software error with a large do-it-yourself program resulting in $400-$800 reduction in the refund of recently retired and unemployed taxpayers.  Every year, I also find places where data was entered for the federal return but not transferred to the state return.

If you are concerned that your taxes weren’t prepared correctly, contact me for a free review of the last one to three years.  There will be no charge unless a change is required.

Beth Logan is an Enrolled Agent for Kozlog Tax Advisers in Chelmsford.  She can be reached at info@kozlog.com.