Frequent Questions

The Tax Attic

April 1, 2009 // 0 Comments

Answers to two more frequently asked questions I had some good comments on last week’s article concerning the most common questions that tax professionals ask of the research company I deal with the National Association of Tax Professionals (NATP). It doesn’t matter how experienced the tax professional is, how long he or she has been preparing tax returns, or how many tax returns he or she completes. Our tax system is just too darned complicated for any one person to know all of the answers. NATP has several retired and currently practicing tax professionals manning the telephones when guys like me call with questions. The reasons I call come from two different types of scenarios. In the first situation, I am pretty sure I have the correct answer but want an independent third party, such as NATP, to back me up. They can provide me with that warm fuzzy feeling that my thought process was correct. In the second type of situation, I need help with a scenario that has me stumped. I usually have a potential answer, but am unwilling to prepare a return based on a potential answer. In these second situations, I am just slightly disappointed when I call and the researcher knows the answer without having to look anything up. That usually means I called with a question that the answer was right in front of me in one of my reference books and I just didn’t recognize the answer or look hard enough. Of course, sometimes the researcher shares with me that a recent caller had asked that same question and that is the reason the answer flowed so smoothly. The comments I received on last week’s article encouraged me to bring up another common situation that tax professionals are asked about. I will also add a Michigan situation that I am commonly asked to explain. Since we are closing in on April 15, a common question that is asked concerns extensions or the lack thereof. An extension is granted automatically by filing Form 4868 and simply asking for the extension. That delays the filing of the return until October 15 with no questions asked. The catch 22 in the system is that there are still penalties and interest that […]