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Accounting Expert 's Top Five Tax Tips

Between online tax tips, easy to use software for filing taxes and phone lines direct to government tax office, in recent years it has become a trend for taxpayers to file their own taxes.

John McGowan, Ph.D., professor of accounting at Saint Louis University, can offer useful tips to help with this process.

A nationally known expert on taxation, McGowan says earlier is better when it comes to working on your taxes. Early filers avoid the last minute rush and get their refunds sooner.

If you live in the USA, McGowan offers five easy ways to get a good jump on your taxes before the April 15 deadline arrives:

1. Gather your records in advance. Don’t forget to save a copy for your files.

2. Get the right forms. They’re available around the clock on the IRS Web site.

3. Take your time. Rushing can lead to making a mistake.

4. Double-check your math and verify all Social Security numbers.

5. Consider e-filing. E-filing catches math problems and gives confirmation for your return. Taxpayers who file electronically get their refunds in about half the time as those who file paper returns.

Want your refund faster?

Have it deposited directly into your bank account. More than 52 million people had their tax refunds deposited directly into their bank accounts in 2005. Direct deposit also can be a lot safer.

“Each year thousands of refund checks are returned by the U.S. Post Office to the IRS as undeliverable mail,” McGowan said. “Direct deposit eliminates undeliverable mail and is also the best way to guard against having a tax refund stolen."

McGowan does offer a word of caution about direct deposit — some financial institutions do not allow a joint refund to be deposited into an individual account.

Check with your bank or other financial institution to make sure your direct deposit will be accepted. Also, make sure you have the correct nine-digit routing number and your account number when selecting direct deposit.

McGowan also offers special advice for newlyweds and the recently divorced. He says it’s really important that these couples ensure the name on their tax return matches the name registered with the Social Security Administration. A mismatch could unexpectedly increase a tax bill or reduce the size of any refund.

It's easy to inform the SSA of a name change by filing Form SS-5 at a local SSA office. It usually takes two weeks to have the change verified. The form is available on the agency's Web site, www.ssa.gov, by calling (800) 772-1213 and at local offices. The SSA Web site provides the addresses of local offices.

Not ready to take on tax preparation by yourself?

McGowan advises that taxpayers choose a paid preparer wisely.

“If you choose to use a paid tax preparer, it is important that you find a qualified tax professional,” he says. “Taxpayers are ultimately responsible for everything on their return even when it’s prepared by someone else.”

While most tax return preparers are professional and honest, taxpayers can use the following tips to choose a preparer who will offer the best service for their tax preparation needs.

• Ask about service fees. Avoid preparers who claim they can obtain larger refunds than other preparers, or those who guarantee results or base fees on a percentage of the amount of the refund.

• Plan ahead. Choose a preparer you will be able to contact after the return is filed and one that will be responsive to your needs.

• Get references. Ask questions and get references from clients who have used the tax professional before. Were they satisfied with the service received?

• Research. Check to see if the preparer has any questionable history with the Better Business Bureau, the state’s board of accountancy for CPAs or the state’s bar association for attorneys. Find out if the preparer belongs to a professional organization that requires its members to pursue continuing education and also holds them accountable to a code of ethics.

also see in Tax Tips -> Tax Filing Tips & Tricks | How to Avoid an Audit

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