The Answers You Need

An accountant prepares detailed financial statements, performs audits of the books of public companies, and they may prepare reports for tax purposes. An accountant is classified by the IRS as a non-enrolled preparer, which means he or she has no standing with the IRS in the matter of representing clients during tax audits and other matters before the IRS. 

A CPA (Certified Public Accountant) is an accountant who has passed the Uniform CPA exam and met all other statutory and licensing requirements of a state to be certified by that state. CPAs are required to take continuing education courses to maintain their license and keep up with changing laws and practices. In addition to preparing and reviewing financial statements, CPAs also prepare tax returns for businesses and individuals, sign tax returns, and represent taxpayers before the IRS for audits and other matters. 

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An Enrolled Agent (EA) is a tax accountant who has passed the Special Enrollment Examination (SEE) administered by the IRS. Enrolled Agents are considered tax specialists and they have a vast knowledge of anything that pertains to income tax, inheritance tax, gift tax, estate, payroll, retirement, and non-profit taxation and can represent clients before the IRS.

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A bookkeeper is responsible for accurately recording transactions, including accounts receivable, accounts payable, inventory and payroll and providing reports on a monthly, quarterly, and annual basis.

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A consultant is a person that provides expert advice professionally to a specific topic. They guide you through processes by providing the "HOW" so you can achieve your goals.

How long should I keep my tax records?

Generally, you must keep your records that support an item of income, deduction or credit shown on your tax return until the period of limitations for that tax return runs out. The period of limitations is the period of time in which you can amend your tax return to claim a credit or refund, or the IRS can assess additional tax.

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Period of Limitations that apply to income tax returns:

• ​Keep records for 3 years if situations (4), (5), and (6) below do not apply to you.

• Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return.

• Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction.

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• Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return.

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• Keep records indefinitely if you do not file a return.

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• Keep records indefinitely if you file a fraudulent return.

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• Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

What if I cannot pay my taxes to the IRS by the filing deadline?

Know that you are not the only taxpayer who has been in this situation. Always remain calm. You should still file your return and pay what you can by your deadline to avoid interest and penalties.  Next, you should contact the IRS to discuss payment options at 1-800-829-1040. 

The agency may be able to provide some relief such as a short-term extension to pay, an installment agreement or an offer in compromise, or by temporarily delaying collection by reporting your account as currently not collectible until you are able to pay. In some cases, the agency may be able to waive penalties. However, the agency is unable to waive interest charges which accrue on unpaid tax bills.

What form of payment do you accept?

What are your payment terms for clients?

All payments are due immediately; the same day services are provided. Once a client establishes history with us, credit terms may be extended for a period not to exceed 30 days.

What if I cannot file my taxes by March 15th (businesses) or April 15th (individuals) deadline?

To be eligible to file an extension, taxpayers must file a request before their applicable deadline. The IRS will extend for the maximum of 6 months. A late filing penalty is usually charged if your return is filed after the due date (including extensions). The penalty is usually 5% of the amount due for each month or part of a month your return is late. The maximum penalty is 25%. If your return is more than 60 days late, the minimum penalty is $210 (adjusted for inflation) or the balance of the tax due on your return, whichever is smaller. Taxpayers are not required to provide the reason for extension. However, you might not owe the penalty if you have a reasonable explanation for filing late. Attach a statement to your return fully explaining your reason for filing late. Individuals must complete Form 4868 and businesses must complete Form 7004. Don’t attach the statement to Form 4868.

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You can also get an extension by paying all or part of your estimated income tax due and indicate that the payment is for an extension using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or a credit or debit card. This way you won’t have to file a separate extension form and you will receive a confirmation number for your records.