Typically, CPAs invoice on an hourly rate — which you request in advance. Regardless of the price point however, if it’s your money and it’s about to become someone else’s money, then it’s in your best interest to be organized and efficient when meeting with your CPA for the first time.
If you’re able to provide all the required paperwork from the onset, then there’ll be less back and forth on emails & calls — spending time — trying to track the information down. To help speed along the process and save yourself some money, make sure you bring the following checklist to your first meeting with your CPA:
- completed tax organizer
- last year’s return
- W2s and/or 1099s
- Brokerage statements
- Mortgage, 1098 form
- IRS notices
- State specific forms
- Schedule K-1 (if you own a business)
Regarding your tax organizer
A completed tax organizer is a form that has all your basic information for your account. Some CPAs will have their own form for you to fill out. Otherwise, you can find basic tax organizers online.
Your previous year’s tax return is essential for new clients; existing clients don’t need to worry about this as the CPA will keep it on file. Some CPAs will request the last 2 years of tax returns to ensure accuracy on their part (and yours). Tax surprises are seldom for the faint of heart.
Form W2/1099 are the most obvious additions. Your employer(s) should automatically mail this out to you (or give you access online). If you haven’t received all of your forms yet, contact your employer immediately.
If you hold any stocks, bonds, or investment accounts, bring your brokerage statement for the tax year. Previous years may be requested if you’re a new client, but for the current tax year, it’s a must.
You’ll need to bring your 1098 form or closing documents, especially If you bought, sold or refinanced real estate within this tax year. Your mortgage company should provide this information or send you a copy.
If the IRS or other tax collecting authorities have sent you a notice or letter, then make sure you bring these with you. Not only is this paramount to ensuring your CPA understands your situation, but also in estimating what the total cost of your taxes will be.
Some states require additional forms or documentation for exemptions and deductions. For example, Seattle and Bellevue businesses have to pay Business & Occupation (B&O) taxes according to Washington State tax law.
Finally, if you have a business, then you’ll want to bring your schedule K-1 form to report income, gains, or losses from S-corporations, partnerships, or other legal entities.
That concludes all the major items on the checklist you’ll want to bring to your appointment.
Supporting documents for your first meeting
The aforementioned items in the checklist are must-haves, but the following are nice-to-have. Not only do they only apply to a niche group of people, but they’re also unlikely to wildly change your invoice.
Supporting documents include schedules, checkbooks, receipts for charitable donations & business purchases, information regarding deductible expenses, and any documents relating to self-employment income. Self-employment income includes miscellaneous income from online sales, e-commerce, etc.
Being organized when it comes to working with a CPA pays off in many ways. You’ll save time and you’ll ensure that your tax return is filed in a correct and timely fashion. This decreases your chances of paying penalties or being audited. Ask your CPA what you should bring to your first meeting and get started off on the right foot.
Photo by Glenn Carstens-Peters