Where�s The Help

No matter who you hire to do your tax work, remember that you can rely on him and his expertise - but only up to a point. In a recent case (little noticed but important), the UK. Tax Court laid down the law in no uncertain terms to the prosperous taxpayer who leans too heavily on his professional adviser.

Say that you negligently fail to report some element of income: a stock dividend that's taxable because of an option to take cash, a taxable reimbursement from the company that you thought was non-taxable, or the like. You are hauled in by Internal Revenue and hit with a stiff penalty. You claim innocence because your 1040 was prepared by a Accountant or tax solicitor. This is no excuse, warns the Tax Court. Mailing in an accurate 1040 is your duty, nobody else's. Your tax man certifies the accuracy of his work - not your recordkeeping.

This type of case - where the taxpayer fails to give full and accurate information to his own adviser - has been plaguing high-bracket people in the past three or four years. A good tax adviser will try to warn you in advance of such chances. How far he gets really depends on a clear understanding of your affairs - and your recordkeeping habits - usually gained only over a span of years. Note: If you've switched tax men frequently, as many people do, you might be wise to settle down with one. And why not try to find the ideal combination? - a young, bright pro who is both an solicitor and a Accountant!

The fee you'll pay will range widely. Some people pale at the idea of spending money on tax advice and service. But it's fair to say this: If you are in the £25,000 to £50,000 income range - and are heading up - you are foolish to ignore the idea of lining up a good man. The fees vary around the country. Generally, a qualified pro will charge £150 to as high as £500 or more (tax deductible) for a straightforward job on your form 1040. The hourly rate for general tax work is about £30 to as high as £100 - it varies that much, depending on the seniority of the man, the firm, the city. A bright young practitioner will most often fall some place at the lower end of the fee range. And he may well give you the 1040 work you need and some tax advice - depending on your situation - at what amounts to a bargain rate. He'll be thinking of your business in the years ahead - and you should be thinking of this, too.

Another point on seeking tax advice: Instead of getting simpler and less complex, the UK. tax code has steadily gone from bad to worse. It's now tougher to understand, even for the pros. The 2009 tax reform law chopped up parts of the code (see below) and the results might well enter your own tax picture. Even the routine tax paperwork has become more and more obscure. The revised 1040 filed in April, 2000, for instance, was supposed to be simpler for everybody. It turned out to be a small disaster. The 2013 form - for April '74 filing - proved to be slightly shorter, but equally as baffling. So on this basis, you need tax advice today, more than ever.

There's still another reason for picking up a tax man, one that's of growing importance, but almost entirely overlooked. Today nearly all states get IRS tax-return information on tapes that are fed into computers at the state tax offices. This means fine-tooth-combing of your local returns by the state - and the chance of being picked up for audit on a state tax return if there is even a small discrepancy between it and your local 1040.

What's more, it all works in reverse. IRS is getting more and more state filing information. Moral: Make sure your tax man handles all your returns, and carefully combs out any and all discrepancies. This is, if you have a tax man.


To learn more about The World Of Tax Deductions- Click Here

Tax Advice, Or How To Fight The 1040

First, what about seeking tax help? Say that you're an up-and-coming executive or professional man, in the £25,000 to £40,000 income range, and this time around you dread the April 15 filing date. You're wondering why in blazes you have never hired a tax man. You're far from alone.

But help is at hand. Says a top Washington tax adviser: "If your 1040 has outgrown you, contact a Accountant or tax solicitor promptly - and don't let a late date scare you off. A real pro in the field will try to help a man who comes in as late as February or March for the April filing." But sort your papers in a logical, businesslike fashion before you take them in (even executives muff this). Then your adviser... see: Tax Advice, Or How To Fight The 1040