To maintain calm, it is very important to correctly choose who you hire to prepare your tax returns. Many of us think short term and, in an effort to save a few pennies, we make wrong decisions and we hire unscrupulous people, or with little knowledge, for preparing our tax returns.
I will explain two recent cases that we received here at Jagg Tax Solution, Inc., and are precisely related to the quality of the "professionals" we hire to help us in our tax returns.
Last week, a trucker visited me and asked me to review his tax return from 2014. We reviewed it for free and without any obligation. While reviewing it we found five errors in his report. Because of these five errors, the IRS was estimating a very high amount in taxes, penalties and interest. When we asked our friend the reason for having hired this preparer to do his taxes, he explained that this person had prepared his taxes for many years at the time he was an employee. But in 2014, our friend became trucker and the preparer did not have any knowledge of this industry, for that reason he made so many mistakes.
The following case is something special. I say this because the "PROFESSIONAL" who helped our second trucker is someone who advertises himself in magazines, as a very experienced professional who can represent you. This is a lie. That's why I say that before hiring a professional, whoever it is, we need to investigate him. Our second friend had made his corporation taxes from 2012, but he had no Employer Identification Number (the EIN of his corporation) and he only presented his corporation documentation containing his Secretary of State’s registration number, but this has nothing to do with his EIN. So, the person who prepared these taxes, did it with his registration number. In short, even though these taxes have been sent to the IRS, they do not exist in their system, because the EIN is not included in them. Because of this neglect, the IRS calculated more than $18,000 in penalties.
In these cases, we can see two things, in the first case, a lack of knowledge of the industry and in the second case, a "PROFESSIONAL" without ethics or scruples.