While some tax preparers may seem nothing more than paper pushers, Patty offers a whole lot more than just number crunching. With each customer, she looks beyond just the tax return to the person she is working with. She considers their personal circumstances and sees how those factor into their tax situations, and advises them on strategies they can employ to help them going forward.
Patty got her start in the income tax preparation business in 2004, when she and a partner opened their first tax office. Over the next 15 years, the business grew to nine locations. In 2019 she made the decision to branch out on her own, and Patty opened her own independent business – Tax Services Plus – in January of 2020.
Patty says education is the key to her success as a tax preparer. Her education of years of tax preparation classes and testing by the IRS to maintain her certification makes her an expert in her field. It’s not just her education that counts, though. A big part of her business is educating her customers.
From helping individuals understand personal exemptions and deductions to working with businessowners on allowable expense deductions to filing quarterly taxes, Patty explains that knowledge is key when it comes to doing your taxes. With tax laws changing every year, a tax service professional can help you stay abreast of the latest requirements, as well as any potholes to avoid.
One example of such an issue is the standard deduction, which doubled a few years ago. While many people think of that as an advantage, Patty says it actually can be a disadvantage for some people with certain types of deductions they are used to itemizing, like large medical bills and mortgage interest. Itemizing used to give people an advantage over taking the standard deduction, but now some of those deductions are limited, so even if their totals surpass the new standard deduction level, they may not be able to take advantage of them.
In some cases, Patty needs to educate her customers on problems they have accidentally created for themselves.
“Sometimes (when they were doing their own tax returns) they hit the wrong key and it shows that they are owed a larger refund than they expected. And of course, they like the idea of a larger refund, so they submit it,” she explained. “Two years later, the IRS contacts them and tells them they’ve made a mistake and now they owe money. Then they have the problem of going back and trying to correct the return.”
She continued, “Sometimes you can’t correct the return because the IRS has already corrected it. Then you just have to set up a payment plan to pay it back. I teach them on how the IRS got to that point to correct the return. I show them what they did wrong that gave them that amount of money, so they don’t do it again next time.”
Another common problem customers face that Tax Services Plus solves is one of software education. Patty says not knowing how to effectively choose and use tax software can cause them to lose a lot of money.
“I teach them how to get more deductions they may have missed with the software they used. Some software lets you put in all possible deductions, while some software doesn’t,” she explained. “Some companies don’t let you put in mortgage interest paperwork and property taxes, or people don’t know where to put them in, so they miss them.”
One thing Patty often sees with her clients is not understanding how personal exemptions work when employees fill out tax paperwork for their employers. Seeking to take home a bigger paycheck each month, some people will put down more exemptions than they are actually due, which can cause problems down the road when their annual tax return is filed.
“Instead of telling their employer they’ve got four or five kids and getting all that money during the year, they need to put down zero so they can have money taken out for the government, to pay their share of the taxes. When they come in to file their tax return and they don’t have all of those people on it, it’s going to hurt them. They’re going to owe money.”
Patty says she is amazed at how many people are upset when they discover they aren’t owed a tax refund.
“Some people come in and they haven’t been paying taxes throughout the year, but expect to get something back as a refund. I have to explain to them that if they haven’t paid anything in to the government, they’re not going to be getting anything back!”
She not only helps individuals think ahead on their taxes, but does that for businesses as well. Around 25 to 30 percent of Tax Services Plus customers are business owners.
“I have some clients who have small businesses, and I show them how to keep track of their expenses, teach them what they can and can’t deduct,” Patty said. “And when they’ve made a certain amount of money, I make sure they are paying their quarterly taxes. That keeps them ahead on things.”
Patty says one of the most basic things she teaches her customers is how to read and understand their tax returns, which she says a number of people don’t know how to do.
“Say, if you’re going to a car dealership or looking at renting an apartment, those people are asking for your tax return. Well, I believe you should know what those people are looking for on your tax return before you hand it over to them. So if you don’t understand it, then you need to learn,” she said.
“So step-by-step, as I do your tax return, I am explaining to you what those numbers are you gave to me and how they are being used in your tax return. Each time you come in, I am explaining your tax return, and you begin to learn what all those entries and money are doing in your tax return.”
Patty explains that helping her customers goes beyond just tax returns, too. She advises people on how to work with the IRS and has helped clients with issues related to other government services when those were affecting their taxes. She talks to people about their budgets, something that often comes up around tax time, and she can also direct clients to vendors and financial institutions that offer loans on tax returns. Even there, she is looking out for her clients’ best interest, and welcomes the opportunity to help you as well.
Tax Services Plus is located at 924 W. Dallas Street, Conroe, Texas 77301. For more information, call 936-788-5990.