Skip to content
Accurate Tax Refund Preparation for Instant Returns
Home » Your Guide to Error-Free Tax Refund Preparation

Your Guide to Error-Free Tax Refund Preparation

  • by
Listen to this article

Tax refund preparation is ever-changing due to the regular revisions and changes in the tax code. Therefore, it is essential to stay tuned to the best strategies for preparing tax returns and getting immediate refunds. Moreover, accountants and self-employed individuals often commit common mistakes when filing returns.

For instance, they calculate the tax returns inaccurately or enter the wrong bank details for tax refunds. This might cause you to lose a portion of or all of your tax refund or delay it.

You must take a systematic approach to preparing tax returns instead of just getting the job done, as this will allow you to get the maximum possible tax refund.

This article aims to guide you through tax preparation to help you avoid mistakes and get a fast tax refund. Go through these tax refund preparation tips for error-free and instant tax refunds.

Basics of Tax Preparation

Although we will not go into the details of tax preparation, we want to brief you on some basic things about it. This will help you get started with tax preparation and jog your mind for things you already know but might have slipped off your mind.

To begin with, tax preparation, start collecting all the financial records and documents by January. Moreover, collect all the receipts and itemize the business expenses into different categories to help with deductions. Now, you’ll either need tax software or a tax preparer to prepare the tax returns.

The accounting software you use, such as QuickBooks or Sage, has the tax forms you need. If not, you can download them directly from the official website of the IRS.

Depending on their employment type or business structure, an individual or business entity might need to file different forms. Moreover, businesses with employees also need to file employment forms and calculate payroll taxes on the basis of that.

Take a look at some well-known tax and related forms:

  • Form 1040 – US Individual Income Tax Return
  • Form W-4 – Employee’s Withholding Certificate
  • Form 1040-ES – Estimated Tax for Individuals
  • Form W-9 – Request for Taxpayer Identification Number (TIN) and Certification
  • Form 4506-T – Request for Transcript of Tax Return
  • Form 941 – Employer’s Quarterly Federal Tax Return
  • Form W-2 – Wage and Tax Statement
  • Form 9465 – Installment Agreement Request
  • Form SS-4 – Application for Employer Identification Number (EIN)
  • Form W-7 – Application for IRS Individual Taxpayer Identification Number

In the same way, filing information for international taxpayers is different from the rest.

Another thing is tax benefits, such as for minority-owned businesses. Explore all the tax benefits you might be eligible for as a self-employed individual or minority-owned business before going ahead with tax refund preparation.

Average Tax Return Preparation Cost in the USA

One cannot say the exact cost of tax return preparation in the USA, as different tax services set their rate, which they can base on hours, tax forms, or itemized data. However, the surveys find that the average cost of tax refund preparation in the USA is as follows:

  • $220 for Form 1040 without itemized deductions
  • $903 for Form 1120S – S corporation
  • $323 for an itemized Form 1040 with Schedule A

However, geography also impacts tax costs, and different regions have different local charges for preparing tax returns.

An hourly rate survey by Intuit published that the rate went up 8.6% from $69 in 2019 to $75 in 2021. However, with time, the tax services across the nation are getting streamlined, and the variations are diminishing.

Tax Return Preparation Fees Deduction

You might wonder if you can claim tax preparation fees with itemized deductions. Well, the answer is no if you are not self-employed. The W-2 employees cannot deduct tax preparation charges or costs if they opt for standard deduction.

The Tax Cuts and Jobs Act (TCJA) published in 2017 limited the deductions you can claim, which included the deduction for personal tax preparation. The business can deduct the tax preparation fees as a business expense.

Tax Return Preparation Services – Assistance and Advice

Qualified individuals can opt for no-cost tax preparation under the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs by the IRS.

The VITA program provides tax return preparation assistance to individuals who earn equal to or less than $60,000, have a disability, or can’t speak English well.

Tax Counseling for the Elderly (TCE) program, as the name suggests, provides free tax services to citizens 60 years old or older than that. You will be able to find VITA or TCE sites nearby.

These sites are operated by IRS partners, and the volunteers work in there who want to contribute to the betterment of society. These volunteers undertake tax law training and pass it to meet the IRS standards.

However, before you go to a VITA or TCE center, you must check the services they provide and the IRS checklist for what to bring. Moreover, a handful of the VITA sites also provide Certifying Acceptance Agent (CAA) services.

Individuals who are not qualified for VITA or TCE can opt for tax preparation services provided by the accountants and firm.

What is the Best Way to Get Your Tax Refund?

The best way to get a tax refund is through filing tax returns electronically and opting for direct deposit instead of a paper check. This would require you to open a bank account first if you don’t have one.

Moreover, prepaid debit cards or mobile apps can also receive direct deposit of tax refunds, given they have routing and account numbers associated that can be shown on the tax return.

Direct deposit is the best way to get your refund, as it protects you from thefts or refunds being returned to the IRS in case of mail.

How Long Does My Tax Refund Take to Process?

While there is no exact time period, the IRS usually processes the majority of tax refunds in less than 21 days. However, in the case of paper returns, the refunds can take more than four weeks to process.

Salient Tax Refund Tips for You

We have compiled a guide of salient tax refund tips for error-free tax refund preparation and fast cash backs. Use these tips when you prepare your tax returns next January.

1. Plan Ahead for Tax Refunds

Planning ahead for tax refunds is important as this allows you to file your tax returns accurately and get the maximum benefits.

This includes collecting the required documents timely, keeping track of business expenses, and prioritizing tax-deductible business expenses. Moreover, early planning will help you take the maximum benefit from tax deductions, tax credits, and concessions programs.

2. Tally with Last Year’s Tax Return

If you do not go through major accounting or business changes, such as accounting method or business structure, last year’s tax return should provide a good checklist of the things you should take care of or include. This will keep you from forgetting or missing out on something during your tax refund preparation.

3. File Tax Returns ASAP

There are two benefits of filing tax returns early – one is that you will get your refunds early, and another is that it saves you from refund thefts.

Criminals try to file fake returns on your behalf to steal your tax returns. In case they file the fake tax returns and quote their account credentials, you will get an error message when you attempt to file the tax returns.

This is why it is advised to file the tax returns early when the filing starts.

4. E-file Tax Returns Instead of Mail

Tax returns take longer to process if you send the returns through mail. Therefore, for fast tax refunds, file the tax returns electronically. Moreover, e-filing tax returns also save you from delays and the possibility of fraudulent activities or theft.

5. Sign Up for Direct Deposit

Another thing you need to do in addition to electronically filing the tax returns is sign up for the direct deposit. Therefore, instead of paper checks, opt for direct deposit to your bank account. This will need you to open a bank account if you don’t have one.

6. Track Your Tax Refund

Once you file your tax returns, you can track the status of tax returns. For that, you’d need

  • Filing status
  • Social Security number (or taxpayer identification number),
  • The exact refund amount

Final Words

The above guide shall walk you through the elements of tax refund preparation. However, to benefit the most from tax deduction optimization and other concessions, you must conduct business tax planning at the end of the financial year. This is where you need an expert on tax and compliance.

We provide rich quality tax and accounting services for individuals and small and large-sized businesses. For tax accounting, planning, preparation, and advisory, feel free to consult our accounting and tax experts. Dial +1(800) 580-5375 and take a free trial of our accounting and tax services today!

Leave a Reply

Your email address will not be published. Required fields are marked *

Connect with A QB ProAdvisor for a Free Consultation. Dial 1800 580-5375