How to Make Tax Filing Easy: Pro Tips from a CPA

Speaker 1 – 00:00
Welcome to EWA’s FinLit podcast. EWA is a fee only RIA based out of Pittsburgh, Pennsylvania. We hope all listeners
of this podcast will beneft as we deep dive into complex fnancial topics that we will make simplifed for you. And
we hope that this really serves as a catalyst so that you can make the best fnancial planning decisions for your
family and also save time. Welcome everyone. This week’s episode of Finland by ewa, joined here by Tyler Bidwell,
CPA Director of Tax. Tyler, welcome.
Speaker 2 – 00:36
Thank you. Appreciate it.
Speaker 1 – 00:37
Absolutely. Well, Tyler, I wanted to get, as we gear up into tax season, you know what would be and I want to gear
this down into like three tips. So frst let’s focus on what are three tips that you would give to someone proactively to
have the best tax fling experience. Minimize room for errors, minimize back and forth, like just kind of, you’re to
describe a fawless tax process fling follow through, what would be the top tips you would give someone if they
want to do their part in preparation?
Speaker 2 – 01:18
Biggest thing I would say is get to work early December. There’s a lot of, you know, it’s important for your advisor to
be proactive. It’s just as important for clients to be proactive because there’s things that you can think about before
the year ends. Whether it’s, as you know, retirement plan contributions, should we purchase equipment for our
business. We put money into 529s HSAs. So proactivity is I think one of the biggest things that you can do and it
avoids any kind of surprises.
Speaker 1 – 01:56
But so Tyler, just real quick to ask a couple follow up questions on that because you say December, which makes
complete sense. There’s a lot of stuff you can do after December. You can do an IRA contribution April 15th. But
when we talk about big tax strategies, do you have like a percentage basis in your mind? Because I know the big
ones in my mind. Putting a car in section 179, like buying a commercial, real whatever it is, it’s a December 31st
deadline if you’re looking for it for that tax year. So do you know in your mind like what percentage? So there’s stuff
you can do obviously to prepare for the tax plan. If you’re working on proactive, like tax planning, tax savings, how
many of those? Our December 31st deadline?
Speaker 2 – 02:37
Yeah, equipment purchases, vehicles, those things are important. Those are always on a calendar year. If you’re, you
know, you own a business and you’re a cash basis business, cash basis taxpayer, you know, maybe you do work in
the last couple Weeks of the year for a customer or a client and you don’t want to collect. Maybe you want to defer
collecting some of that income or it works on the other side. Maybe you have some vendors that you have some
open payments for and you want to get those remitted so you’re able to capture the expense within the calendar
year. Little things like that.
Speaker 1 – 03:16
Yeah, we’ve done that before as well. Prepaid some stuff for the. Okay, interesting. So that’s tip number one is
proactive preparation, planning that starts in December, not April 14th of the following year. Yeah, the day before.
Speaker 2 – 03:32
Yeah.
Speaker 1 – 03:32
All right.
Speaker 2 – 03:33
It’s an accountant’s tax preparers worst nightmare to start collecting tax documents when you get into April. Yeah,
yeah.
Speaker 1 – 03:43
Well, okay. What’s tip number two? That’s a good one.
Speaker 2 – 03:47
I would say communication. You get, you get a lot of, you know, taxes aren’t fun. People hate them, they hate paying
them. But the reality of it is they’re not going away. Everyone has to deal with them. Communication is key. I run into
a lot of instances where something may go on in a client’s life. You know, they use that, we use the term you don’t
know what you don’t know. So I’d like to. For people to think of their CPA more as a. I guess not just a tax preparer.
Like kind of think of them as a fnancial advisor. Absolutely. Hey, Tyler, I got this thing that, you know, I’m looking to
purchase a house. How’s it gonna affect my taxes? Hey, I’m looking to get a new vehicle for business. Can you help
me structure that? Is it better to lease?
Speaker 2 – 04:41
Is it better to buy? So just over communication is a good thing. I think it diminishes surprises, diminishes big tax
bills. It makes your cpa, your preparer, feel a lot more comfortable when it comes time to get your return done. So
that’s another tip that.
Speaker 1 – 05:02
Yeah, I love that one. I think that’s the bedrock of a successful client relationship. There’s strong response time back
and forth. There’s respect, there’s. There’s follow through. Strong follow through. I think that, that’s what sets a lot of
professionals, the top performing professionals that, you know, people want to rave about. They’re, they’re strong
and follow through because people are busy. So there’s strong communication between and there’s strong follow
through on the professional side to keep the accountability going. So I love that one. All right, what’s tip number
three?
Speaker 2 – 05:38
I would say the biggest thing and it kind of piggybacks on number one, absolutely do not procrastinate. Because
when you wait to get, collect your tax information and send it to your preparer, and the longer you wait, your preparer
continues to get more stressed because the deadline’s coming. So it’s an easy way for preparers to make mistakes
because of, you know, tiredness, burnout, what have you. And, you know, then you got to deal with, you know, if your
return’s done incorrectly, you got future notices, you got to deal with. Just, you’re going to end up creating more
issues the longer you can procrastinate. And if your tax preparer is asking you questions, there is a reason they’re
doing it. They’re not trying to bother you. They’re not trying to ask you things that they don’t need.
Speaker 2 – 06:38
There is a reason why they’re asking you a certain question. So just do your best to not procrastinate. Get your
things done, get them in early, and it’s just gonna make things just work that much more smoothly.
Speaker 1 – 06:54
Completely agree the going on the more of the defensive side. If you were to say three tips of, like, how to avoid tax
stress or how to avoid crosshairs of the irs, what would you say? Just in general, speaking from, like, the 14 years of
experience you’ve had, what would be three things that you want to avoid?
Speaker 2 – 07:22
I mean, I would say, I don’t know if I have three. I would just say that the most important thing is always rely and seek
help from an expert. There’s, there’s so many avenues now. There’s, you know, there’s LinkedIn, there’s TikTok, there’s
Twitter, what have you, that there. People are kind of just spewing things out there, and people read it and get it in
their minds, oh, I’m going to do this, seek help. I think that’s the biggest thing, you know, you always hear, oh, I saw on
social media this, I think I’m going to do that. Or I was talking to my friend. He’s, he’s doing this, doing it this way. So I
think I’m going to start doing it this way. Rely, rely on your, on your cpa, on your tax preparer.
Speaker 2 – 08:07
And I think that’s the best way when you’re making any kind of fnancial decisions, reach out and ask how it’s going
to affect your taxes. I think that’s the best way to avoid any surprises or audits or notices.
Speaker 1 – 08:25
And just to Be clear, the I. This isn’t like the justice system where what is the saying, you’re innocent until proven
guilty. With the irs, it’s the opposite.
Speaker 2 – 08:33
Right.
Speaker 1 – 08:33
You’re guilty until you prove yourself innocent. Have you get a notice. It’s like, that’s one thing. And I personally, I don’t
mess with the irs. Like, I, I want to keep them happy at all times. Obviously, I want to pay as little tax as possible, but,
you know, it’s not something that you mess with, in my opinion.
Speaker 2 – 08:48
Yeah. Not only is it stressful trying to get things resolved, it’s such a, it takes so much time right now. I mean, it can
take, you know, weeks, months, even over, you know, a year sometimes to get things resolved with the irs. So it’s
good to do your best to avoid those.
Speaker 1 – 09:06
What do you. So how any early predictions on Elon Musk is. Didn’t he just get higher on the task force to, like, make
the government more efcient? I was reading and he’s like, we’re going to, like, get rid of this. Like, basically this and
this. And part of it was irs. So no prediction.
Speaker 2 – 09:23
I got no predictions. I tend to, you know, there’s so much stuff out there, I tend to not rely too much on it until it’s
actually kind of solidifed and in place. Smart. Because then you’re, you’re just cramming your head full of stuff that
was probably not necessary to begin with.
Speaker 1 – 09:41
Gotcha. Okay. You’re taking over someone’s tax return. What are the most common ways that you’ve been able to
fnd mistakes, save actually go a Met. I’ve seen this several times. You’ve been here a couple days and you’ve already
saved clients thousands of dollars on prior tax returns and just like getting ready for the new 2024 tax return. But.
Yeah. What are the most common mistakes that you see? How do you fnd those?
Speaker 2 – 10:11
Common one. Now, let’s get more popular. Is the backdoor Roth treating those incorrectly because the issuing
company actually issues the 1099R and puts a taxable amount in box two. And so if a preparer just gets that and
types it into a software as it is on its face, automatically.
Speaker 1 – 10:31
Goes in as taxable.
Speaker 2 – 10:32
Yeah, is taxable. And so, I mean, as you know, the contributions were put in with already taxed dollars. You’re taxing
it again. That’s double tax. That’s one. I see a lot other common ones. You know, maybe you can take advantage of
certain expenses for business owners that have a sole proprietorship on a Schedule C. Maybe you’re missing, you
know, they’re traveling, they don’t keep track of their mileage. Maybe they’re using their personal cell phone to make
80% of their calls are related to their business. You can take advantage of that if you have a home ofce. A lot of
times they’ll see a home ofce deduction on there. So little things here and there. Not anything that’s gonna sway
things, millions of dollars or anything, but just a way to save a few hundred bucks here and there.
Speaker 1 – 11:28
Awesome. Awesome. Well Tyler, we appreciate we’re gonna do more of these educational type podcasts in the
future, but yeah, looking forward to this 2024 tax return and clients. Please reach out if you have any questions at.
Tyler, obviously everyone’s tax situation is different and if you’re, you know, a business owner or a 1099, there’s lots
of unique things we can do to save as much tax as possible as legally as possible and as streamlined as possible.
So Tyler and the EWA team will help implement everything. But Tyler, thanks for joining.
Speaker 2 – 12:00
Appreciate it.
Speaker 1 – 12:01
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