It will be tough (this year) to use all the tips in Sandy Botkin’s book: “Lower Your Taxes-Big Time” ISBN: 0-07-140807-X, price:$16.95. The reason? Many of us didn’t have a home-based business on the side last year and have to calculate taxes-due the old-fashioned way (pay and pay and pay and pay). So who helps small business people like us? What kind of rip-offs are out there, who are the experts, and why not do it all yourself?

RIP-OFFS
Several weeks ago I told you about the ‘tax preparation experts’ that crawl out this time of the year with their ‘super-duper-instant refund’ tax preparation programs. You will find these firms sitting in kiosks in your shopping mall, advertising in the newspaper, touting their services on radio or TV, blasting your computer with email offers, or overloading your mailbox with advertisements; all designed to part you and your left-over money. Many of these firms use a non-specific computerized tax preparation programs meant to cover the tax challenges of people with only wages as income and more-or-less standard deductions. The few that offer business services are marginally accurate at best, and may miss valid deductions at worst. Their services are often performed by non-tax-certified-accountants (not CPAs) or people whose tax knowledge ceases with the filling-in of blanks in a computer program. Often these firms dangle the carrot of instant refunds which are poorly disguised high interest loan programs. (If you want a loan on tax refunds due, take your filled-out tax form to your bank or credit union!)

CPAs, TAX ATTORNEYS & ENROLLED AGENTS
Hiring a CPA to “do” your taxes is the traditional method of making sure your taxes are figured correctly; but make sure your CPA is well versed in your industry. Ask when last they attended one of the certified tax preparation courses and who sponsored the training. Congress changes the tax rules every year, the IRS interprets them, and unless your CPA is up on the latest, guess who pays? One benefit of using a CPA is that many will meet the IRS auditor with you should that serpent rear its ugly head …a decidedly important service should you need it! There are two additional classifications that can help here, one is the Tax Attorney and the other is the Enrolled Agent. All three take the same tax courses each year, and all three are well qualified to represent you at the IRS.

DO-IT YOURSELF SOFTWARE
Yes, there are software packages out there that purport to have all the latest bells and whistles of tax preparation, but they don’t help you gather the information. You gather it yourself from your books (or the shoebox you’ve been using this year) then put the figures into their package and wonder of wonders, a few CD spins and you owe the IRS more than you thought possible! There’s nothing illegal about these programs, they just cannot do the complete job!

HELP BOOKS
These books are great for the do-it-yourself taxpayer or the person who wants a better understanding of where their money goes. If this describes you, I recommend the CCH Business Owner’s Toolkit Tax Guide 2003 by Susan M. Jacksack, J.D. ISBN 0-8080-0832-3 ($17.95 in your bookstore). This tax guide is one that stays on top of everything! Whether you end up filling out the tax forms yourself or using one of the better tax preparation services, you will gain the knowledge of what you can and cannot deduct and how the IRS wants that material gathered, prepared, and presented. A great book!

TAX PREPARATION SERVICES
Over the years there have been a few firms that are well known for their tax preparation programs. Most are great, but if you go this path you need to do your homework. Call ahead and obtain the names of their on-staff CPA, Tax Attorney, or Enrolled Agent tax-preparers with small business expertise (preferably in your line of business). Be sure they are CPAs, Tax Attorneys or Enrolled Agents! These are the people who will actually enter your data into the firm’s proprietary tax preparation software.

I personally use one of these firms, and when I first began using their services I asked for the names of the CPA experts in my field, contacted each, checked their references, and selected one that I felt most comfortable with. Now, each year I call for an appointment with that specific individual. I know they understand my business, and will guide me in using the IRS rules and regulations that will benefit me.

(NOTE TO EDITORS: PLEASE INCLUDE THE FOLLOWING.)
Paul Tulenko is an International Small Business Success Consultant based in New Mexico, USA. Additional tips and suggestions are available at www.tulenko.com or call (toll-free) 1-866-TULENKO.