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Tax preparation key despite federal delays

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Local tax professionals are urging taxpayers to act proactively this year in filing taxes despite federal delays.

Tax adviser Karen Michaud helps Andrew and Katie Reel prepare their 2012 taxes at H&R Block on Thursday. H&R Block has trained its employees to deal with health care reform because this year's return determines a person's status under the act.  EMILY ROSE BENNETT/STAFF
EMILY ROSE BENNETT/STAFF
Tax adviser Karen Michaud helps Andrew and Katie Reel prepare their 2012 taxes at H&R Block on Thursday. H&R Block has trained its employees to deal with health care reform because this year's return determines a person's status under the act.

“Don’t change your course of action because of the IRS,” advises CPA Rick Evans, a partner in Serotta Maddocks Evans & Co.

Tax season got a later start in 2013 as fiscal-cliff negotiations dragged into the new year. After Congress reached an agreement on tax-law changes on Jan. 1, the Internal Revenue Services delayed processing income tax returns from Jan. 22 until Jan. 30.

Returns won’t be accepted until even later – from mid-February into March – for taxpayers who claim certain credits, including education, residential energy, general business and 28 others.

“That’s caused some problems as well,” said Mark Daniel, the president of Rhodes-Murphy Income Tax Service. “A lot of our clients aren’t aware of those changes.”

Uncertainty surrounding the fiscal cliff also led to more calls to Rhodes-Murphy from concerned clients.

“There have been a lot of phone calls because of the rumors flying around,” Daniel said. “We hear taxpayers call up and say, ‘I’ve heard rumors that you can’t file until February.’ ”

During a normal year, taxpayers usually can expect to begin filing in mid-January. This year, they’ll have two weeks less to meet the April 15 deadline.

Another common fear is that the IRS will take longer in issuing refunds.

Tax professionals have been told that people will begin to receive refunds in 10 to 21 days after the return is received.

“There’s a lot of people in a tough economy who depend on getting those results as quickly as they can,” said H&R Block marketing coordinator Matthew Terry.

H&R Block employs about 150 tax and client-service professionals at 14 centers across Augusta, Aiken and Fort Gordon.

An extra emphasis this year was given on health-care-reform training for H&R Block employees, Terry said.

The 2012 tax return will determine an individual’s base level of income to be used in enrolling in Obamacare this fall, he said.

“This year’s return is critical,” Terry said.

At local Jackson Hewitt Tax Service offices, tax workers got a jump-start in sending returns on Jan. 23 as the company took part in the IRS’ testing process. In those instances, the government began releasing refunds to taxpayers on Feb. 1, said Kanchan Khosla, the manager of Jackson Hewitt on Columbia Road.

Six employees were added for this tax season at Khosla’s center, she said.

About 50 full-time accountants and tax preparers are on staff at Rhodes-Murphy’s nine locations, Daniel said.

In December, the business hires 20 to 25 seasonal employees to serve as receptionists, printers and customer-support personnel, he added.

Daniel said his staff already had filed thousands of tax returns in the first two days of tax season.

“The delay didn’t stop us from preparing tax returns,” he said. “It stopped us from transmitting them to the Internal Revenue Service.”

Educating employees on current tax laws is key at Rhodes-Murphy, Daniel said.

Intensive training, and not additional hiring, also is commonly practiced at Serotta Maddocks Evans & Co., Evans said.

There, about 40 full-time staff members begin training in December and continue through January as additional software updates are passed down from the IRS.

“It’s a continuous training exercise,” Evans said.

Daniel also advised that taxpayers claiming the earned income credit make sure they provide the necessary documentation this year.

“We’re under a lot of due diligence from the IRS to make sure that those programs that have been abused in the past, that they’re cutting down on some of the fraud,” he said.

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soapy_725
43306
Points
soapy_725 02/02/13 - 10:48 am
1
0

Strange that updates to HRB software continue

Unpublished

into February. The last update, a large one, was Jan 31. How can they be filling returns if the tax laws have not been finalized? The updates are understandable. But how can you accurately determine a tax return when the final rules are in flux?

Riverrunner30909
138
Points
Riverrunner30909 02/04/13 - 05:32 am
0
0

Filing Suit for Americans

Unpublished

Americans need to band together and file a class action suit against the IRS for interest and penalties at the same rate as they charge us if we are late.

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