Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

Archive for January 18th, 2006

Posted by taxguru on January 18, 2006

Certain Tax Returns Go to Different Centers than Last Year – IRS’s annual reshuffling of the workload for the service centers we have to send returns to.


Charities Not Thrilled With Latest IRS Guidance on Vehicle Donations – Nobody likes to have to deal with additional paperwork; but this did deal with some very real abuses by donors.


 IRS Progressing Toward Development of Data Clearinghouse – Nothing could go wrong here, right?  IRS has such a stellar track record when it comes to upgrading computer capabilities that we have nothing to worry about.   


 Adding Roth options to your 401(k) saving plan


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From the WSJ Free News Feeds

Posted by taxguru on January 18, 2006


New Incentives Make ‘Going Green’ Easier – Including some new tax credits.


How to Get Rid Of Private Mortgage Insurance


Retiree Helps Others Manage Their Nest Eggs


Is It Time To Unload Your Investment Properties?


Why Some Supermansions Are Priced Not to Sell



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The Tax Preparer Profession

Posted by taxguru on January 18, 2006

While I have never in the least felt my business to be threatened by do it yourself tax software, that hasn’t been the case for many other tax professionals, such as in this email from Ohio CPA Dana Stahl.

Mr Guru – saw your blog this am.  You really do know tax pros who “are desperately looking for clients?”  I know I’ve had a hell of a time trying to build the accounting end of my practice, what with some of the marketing programs I’ve tried.  The tax end has grown, however.  But I do worry about the future, particularly with the tax software available for people to do their own plus the IRS making tax prep available online.  I know we’ve discussed that before, but I do need to pay attention to the trends affecting our profession.  That’s why your comment about desperation jumped out at me.
Talk to you soon,
I wrote back:


As you well know, there is a growing mini-industry that focuses on helping accountants get new clients; so there is obviously a big market for that. I also frequently see messages on the discussion boards asking for help on how to generate new clientele. 

As I’ve always said, tax preparers who are nothing more than form fillers do need to worry about competition from do it yourself software.  Those of us who use our knowledge and experience to massage the info have nothing to fear from those programs.



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Debating the Eluisive Tax Gap

Posted by taxguru on January 18, 2006

Ohio CPA Dana Stahl has been watching the discussions on the tax gap issue.

Mr Guru – I finally got around to looking at the Roth & Co post on the “tax gap“.  He, as you know, took you to task for “selection bias”, citing restaurant owners & others who keep revenue off the books & those who come up with bogus deductions (of course, you would NEVER know about those matters, right?  You’ve only been preparing taxes for how many years now?
Guess that means you’ve got no clue to how the real world really works).
Anyway, he does raise an issue here.  Wondered what your counterpoint would be.  Something for your blog in the future?

Sandusky, OH

My Response:

In regard to the tax gap debate, I have never said that nobody cheats on their taxes.  In fact, I make a point of posting plenty of articles on tax cheaters.  Maybe it’s just the difference in my outlook on humanity.  Most other people, including some other bloggers, seem to always see the worst and start from the premise that everyone is dishonest and will cheat on their taxes.  Based on my 30+ years of working with people from pretty much all cross sections of our society, I know that assumption is not true and is an unfair characterization.  I stand by my opinion that it is wrong to treat everyone as a criminal and punish us all with more Gestapo like powers for IRS just because of a small number of people who refuse to obey the laws.

I’m nearing the end of an email exchange with someone who is a classic example of how people intentionally overpay their taxes that I hope to post in the next few days.



Update: I have posted the above-mentioned email exchange.


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