Tag: taxes

What Should You Bring to Your Accountant When You File?

Although it’s technically possible to file your own tax return by using software, this can leave you exposed to a wide range of issues. If you want to ensure that everything with your tax return is handled by an experienced professional, working with a reputable accountant is an investment that should always pay off by unlocking extra savings and helping you avoid mistakes.

 

If you’re planning on enlisting an accountant’s help this year and are wondering what to expect during your appointment, here are some helpful tips on what to bring along with you:

 

Social Security Cards

 

The accountant you work with will want to verify your identity prior to submitting your filing. And if you are claiming any dependents, it’s a good idea to bring their card along as well. Although social security numbers seem like an easy enough thing to manage, SSN mistakes result in 100,000s of tax returns being sent back by the IRS every year. Since that’s guaranteed to increase how long it takes to get your refund, bring along your cards so your accountant will be able to double check the accuracy of these numbers.

 

Last Year’s Tax Return

 

Even if your financial situation has changed quite a bit over the last year, it’s still helpful for an accountant to have your previous year’s return as a reference point. This will allow the professional you work with to identify which deductions and credits you previously claimed, then quickly see if you’re eligible for them again.

 

W-2 and Any Other Income Forms

 

If you work as a traditional employee at a company, your employer should have already provided you with a W-2 form this year. This document has a lot of important information your accountant will need, so be sure to bring it along. For freelancers, the most common form to receive is a 1099-Misc. And if you have any investments or other activities that produced income, you’ll want to bring all of those forms along for the accountant to review.

 

Expense Documentation

 

Did you make some charitable donations over the course of last year? Maybe you do some selling online and drove around a lot to source inventory. Regardless of the specific donation or expense, an accountant is going to want to see documentation before claiming it for you. While it may take some time for you to get organized prior to your appointment, it will be well worth the effort.

 

If you’re ready to file your tax return and want to work with a great Cincinnati accountant, Donohoo Accounting Services is here to help. Call us today at (513) 528-3982 to schedule an appointment

4 Actionable Tips for Using Your Tax Refund This Year

Even though getting your tax refund can feel like hitting a mini lottery, it’s important to remember that this payment is your money. As a result, the last thing you want is to let it flow out of your bank account just as quickly as it arrives. If you’ve had that experience in the past, the good news is you can do things differently this year. To help you make the most of every dollar that you receive, here are 4 actionable tips for using your tax refund this year.

  1. Make Payments Towards Debt

People from all walks of life struggle with managing debt. What often starts off as a small amount can spiral into a snowball that just keeps rolling in the wrong direction. What makes debt so problematic is that you’re not just dealing with the initial amount. Instead, interest is what really gets people in bad situations.

Because debt can choke someone’s personal finances, using your tax refund to pay off some or all of your debt is an amazing choice. If you’re trying to decide the specific debt to pay towards, the one with the highest interest rate is almost always the best choice.

  1. Prepare for An Emergency

Whether you have been able to stay out of debt or used previous tax refunds to pay it off, anyone who doesn’t have this burden can intelligently use their refund in a number of ways. A great option is to build up your personal or family emergency fund. Having a meaningful amount of money that’s easily accessible but off limits except for an emergency can give you a lot of peace of mind.

  1. Improve Your Home

Let’s say you’re already debt-free and have a comfortable emergency fund built up. One option to consider for your refund is improving your home. As long as you do your research and choose a project with a strong ROI, you’ll be adding to the long-term value of what is likely your largest asset.

  1. Other Investments

The other really good option that’s available for leveraging your tax refund is investing the money. Just keep in mind that even though highly speculative investments like cryptocurrency can seem enticing, they come with an incredible amount of downside risk. Investing your money in a more conservative option and letting it grow for the foreseeable future will likely yield the best return.

If you want to get your tax return filed so that you can get your refund and put it to good use, Donohoo Accounting Services can take of this process for you. All you need to do is call us at (513) 528-3982 to set up an appointment.

What To Bring To Your Accountant When You File Taxes

Although it’s technically possible to file your own tax return by using software, this can leave you exposed to a wide range of issues. If you want to ensure that everything with your tax return is handled by an experienced professional, working with a reputable accountant is an investment that should always pay off by unlocking extra savings and helping you avoid mistakes.

If you’re planning on enlisting an accountant’s help this year and are wondering what to expect during your appointment, here are some helpful tips on what to bring to your accountant when you file taxes:

Social Security Cards

The accountant you work with will want to verify your identity prior to submitting your filing. And if you are claiming any dependents, it’s a good idea to bring their card along as well. Although social security numbers seem like an easy enough thing to manage, SSN mistakes result in 100,000s of tax returns being sent back by the IRS every year. Since that’s guaranteed to increase how long it takes to get your refund, bring along your cards so your accountant will be able to double check the accuracy of these numbers.

Last Year’s Tax Return

Even if your financial situation has changed quite a bit over the last year, it’s still helpful for an accountant to have your previous year’s return as a reference point. This will allow the professional you work with to identify which deductions and credits you previously claimed, then quickly see if you’re eligible for them again.

W-2 and Any Other Income Forms

If you work as a traditional employee at a company, your employer should have already provided you with a W-2 form this year. This document has a lot of important information your accountant will need, so be sure to bring it along. For freelancers, the most common form to receive is a 1099-Misc. And if you have any investments or other activities that produced income, you’ll want to bring all of those forms along for the accountant to review.

Expense Documentation

Did you make some charitable donations over the course of last year? Maybe you do some selling online and drove around a lot to source inventory. Regardless of the specific donation or expense, an accountant is going to want to see documentation before claiming it for you. While it may take some time for you to get organized prior to your appointment, it will be well worth the effort.

If you’re ready to file your tax return and want to work with a great Cincinnati accountant, Donohoo Accounting Services is here to help. Call us today at (513) 528-3982 to schedule an appointment.

How to Save for College

College is an important topic of conversation for many families. While there are lots of exciting things to talk about related to college, there are also some very stressful ones. Money is probably the most stressful. Given how common significant student loan debt has become, paying for an education can seem like a very big obstacle.

 

For many years, getting a college degree seemed like a reliable way to land a great job and get ahead in life. But because plenty of parents are still trying to pay off their own student loan debt, the path no longer seems as clear. Due to this disillusionment, plenty of families get overwhelmed and have no idea where to start as far as saving goes. That’s why only about one-third of low-income and middle-income families are saving at all for college.

 

If you agree that this topic is stressful but want to figure out how to save for your child’s college education, we want to cover the three best options to make that happen this year:

 

  1. 529 College Plan

 

The state of Ohio offers a 529 college savings plan. This plan can also be referred to as a Qualified Tuition Program (QTP). The way a 529 plan works is you invest after-tax money into it. Then when your child reaches college, money can be withdrawn tax-free for qualified expenses like books or tuition. The tax-free status includes gains made by the plan. One of the great things about this plan is you can contribute quite a bit to it each year.

 

  1. Roth IRA

 

When most people think of a Roth IRA, they think of it as a retirement account with a favorable tax status. What isn’t as well known is that this account can be used for college as well. As long as funds have been in the account for at least five years, they can be withdrawn for qualified college expenses without triggering any tax penalties. The biggest appeal of this account is the flexibility to pay for both college and retirement expenses.

 

  1. Coverdell Education Savings Account

 

This option has a lot of similarities to a 529 plan. That includes being viewed as your asset, so it won’t hurt your child’s odds of receiving financial aid. But as you probably guessed, there are some important differences as well.

 

The biggest difference this option provides is it’s not limited to college expenses. Instead, it can be used for any educational expenses ranging from kindergarten through 12th grade and beyond. A common example is private school tuition. The main limitation is how much you can contribute each year.

 

If you’re interested in speaking with a tax planning professional about the best ways to start saving for your child’s college education, get a free consultation by calling Donohoo Accounting at 513-528-3982.