Your clients need a CPA they can trust, and that trust has to be earned. Invest a little extra time and energy to ensure they receive the biggest tax return possible this year and watch your business develop naturally. By getting your client a number they’re dazzled by, you’re sure to retain their future business. They best form of marketing is personal testimony, and if they’re impressed by your work, they are likely to refer your services to their friends and family. Check these boxes to make sure you’re generating huge returns this year.
Deductions and Write-offs
This sounds like a no-brainer, but check thoroughly for all deductions on your clients’ tax returns. Don’t stop at deducting college tuition fees; use a Form 1098-T to deduct the cost of computers, books, software, and other related fees. Try getting more creative with your clients’ write-offs. If your client has a bad back and a doctor’s note that suggests swimming, deduct that $35,000 swimming pool as a medical expense. As long as a prescription for fitness can be proven, SoulCycle counts. Remind them that therapists and dentists count toward medical write-offs as well, and check if they’ve gotten any dental work done recently. For corporate clients, remember that the IRS views anything that can be proven to conducting business as legitimate expenses. If they take visiting partners out own the town, you can write-off thousands of dollars in steak dinners in the name of business development. Too many CPAs overlook mileage spent by business owners and entrepreneurs. A real estate agent might drive so frequently between listings that he or she can write off $5-6K per year.
As your clients’ lives change, they might become eligible for new breaks on their returns. Be sure to double check and see if your client qualifies for any tax credits this year. Moderate income working families could qualify for up to $6,250 in Earned Income Credit if they have qualifying children. Child Tax Credits could also produce bigger returns with up to $1,000 per qualifying child. If a family has one of their kids in their first four-years of college, file the American Opportunity Credit and get them $2,500 in savings. Installing of qualifying energy-efficient home improvements also creates room for tax credits.
Never cheat on taxes—but look for totally legal and ethical loopholes within the tax code. If your client owns their own business and is saving for retirement, set them up a Simplified Employee Pension (SEP). SEPs will significantly reduce their tax rate while also increasing their tax-advantaged retirement saving limit. Small business owners can contribute up to 25% of their Schedule C income to the SEP, or up to $53,000 per year. That means the max is almost ten times more than a traditional IRA, plus the whole contribution can be written off as a business expense. While you can’t claim pets as dependents, the maintenance of a service animal may count as a medical deduction. Try to explore new ways to find breaks for clients.
Software on Your Side
It’s time to convert those old books and ledgers to cloud computing. Making this switch will not only improve your efficiency by speeding up monotonous tasks, but automated calculations will assure accuracy on your clients’ forms. Harness technology and use tax prep software from ProConnect to make a greater difference in your clients’ lives. Intuit Lacerte will help you tackle even the toughest returns and provides form modules to help you serve the widest variety of clients. Using online e-filing systems will ensure your client gets their tax return as quickly as possible.
Live up to your reputation of being the best CPA in the area by generating the word-of-mouth buzz. If you check all these boxes, you can send your client into work bragging about the return they received and see an influx of referrals sent your way.