Money on My Mind

Taxes: Tips for Choosing a Tax Professional

Tax season is never easy. Here's some tips to follow when your choosing a tax professional.

Why should I be careful when choosing a tax professional?

  1. The tax professional will have access to key personal and financial information, such as your social security number, income and investment information. You need someone knowledgeable and trustworthy.

  2. You are still responsible. IRS Criminal Investigation (CI), notes, “Taxpayers are responsible for the accuracy of all entries made on their tax returns. This remains true whether the return is prepared by the taxpayer or by a return preparer.”

How much will I pay? How much you’ll pay a tax professional is based on many variables, such as the complexity of your return, how many schedules are needed, personal vs business income, etc. However, according to Better Financial Counseling Network’s, Jerry Zeigler, an Enrolled Agent (the highest credential the IRS awards),A tax professional should be able to provide an estimate on the price and explain from the beginning what fax forms and services that price is based on. To avoid seeing a price increase, due to unexpected items requiring more tax forms, be as clear as possible with your professional about your situation.”

Interview before deciding: As with any major purchase, it’s best practice to interview a few tax professionals, before making your decision. Zeigler states, “One way to help choose a tax professional is to get referrals from friends who have had a similar tax situation. Another method is to ask a tax question that you know the answer to as a screen of the professional’s answer. A more vague or evasive answer may be a red flag. Screening questions like this are a bit subjective and can have limitations, but they can be helpful.” If you are married, make sure both spouses are comfortable with the tax professional. This person may be a long-term resource, so it is important everyone is comfortable with not only the professional’s advice, but their manners and personality as well.

Utilize the Directory of Federal Tax Return Preparers with Credentials and Select Qualifications is a free searchable and sortable database. It includes the name, city, state and zip code of credentialed return preparers who are CPAs, enrolled agents or attorneys, as well as those who have completed the requirements for the IRS Annual Filing Season Program.

What Red Flags should I watch out for? IRS Criminal Investigation (CI) provides the following tips"

  • Avoid return preparers who claim they can obtain larger refunds than other preparers.

  • Avoid preparers who base their fee on a percentage of the amount of the refund.

  • Use a reputable tax professional that signs and enters a preparer tax identification number (PTIN) on your tax return and provides you with a copy for your records.

  • Consider whether the individual or firm will be around to answer questions about the preparation of your tax return, months, even years, after the return has been filed.

  • Never sign a blank tax form.

Marjorie McLean, MBA, AFC®

Tax time! 2 Warnings & 4 Resources to Help You File.

Warning 1: E-File may be your best friend this year, as there is a backlog in processing Paper returns. It’s been widely reported and confirmed by the IRS, that there are still millions of 2019 tax returns awaiting processing by the IRS. This means untold numbers of Americans’ who anticipated a refund based on their 2019 taxes have not received their refund yet. If it’s possible for your return, begin now to research options to e-file and keep the paper for your home file.


Warning 2: The COVID stimulus and reliefs acts have brought a lot of changes to the tax code this year. We have seen two rounds of economic impacts/stimulus payments and recovery rebates for those with payment issues, a payroll tax deferral-which has come and gone, expanded unemployment benefits and a larger number of unemployment claims. If 2020 brought considerable changes to your personal or business financial and tax position this may be the year to seek out additional tax assistance.


If the 2020 tax year has you looking for additional assistance, here’s some (Fee and Free) resources to consider.


Resource 1: Tax professionals, who are credentialed with the IRS. According to Better Financial Counseling Network’s, Jerry Zeigler, an Enrolled Agent (the highest credential the IRS awards), ”engaging a tax professional can make a lot of sense when your tax situation changes into something you are not familiar with.” This could also be an opportunity to check on how you have been filing returns, to see if you have been making any errors.


The Directory of Federal Tax Return Preparers with Credentials and Select Qualifications is a free searchable and sortable database. It includes the name, city, state and zip code of credentialed return preparers who are CPAs, enrolled agents or attorneys, as well as those who have completed the requirements for the IRS Annual Filing Season Program.


Coming Soon: Taxes: Tips and Red Flags when Choosing a Professional


Resource 2: The IRS Free File Program provides two ways for taxpayers to prepare and file their federal income tax online for free:


Resource 3: The IRS's Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs offer free basic tax return preparation to qualified individuals.

The VITA program has operated for over 50 years, offering free tax help to:

  • People who generally make $57,000 or less

  • Persons with disabilities; and

  • Limited English-speaking taxpayers

In addition to VITA, the TCE program offers free tax help, particularly for those who are 60 years of age and older, specializing in questions about pensions and retirement-related issues unique to seniors. Unfortunately due to COVID-19, many of these sites are closed. Some sites have changed their service to drop off tax return preparation instead of in person. Please see Free Tax Return Preparation for Qualifying Taxpayers | Internal Revenue Service (irs.gov) for more information.

Resource 4: Free Resources for Military Members and Spouses (Active Duty, Guard & Reserve)

Military Life is full of adventures and if we’re honest, complications. In addition to normal life changes, you may have taken on moving, deployments, or become an accidental landlord. In 2020, COVID added many new complications to all our lives including taxes.


Fortunately, the military has stood up MilTax through Military OneSource, a Department of Defense funded program.

Free Tax Help offered by MilTax, Military OneSource:

  • Free Tax Prep and Filing Software: MilTax preparation and e-filing software is available January 19 through mid-October.

  • Connect With Military Tax Consultants: MilTax consultants are specially trained to help with unique tax situations specific to service members and their families. Reach out 24/7 to schedule a consultation..

Source: MilTax: Free Military Tax Return Preparation Services & Filing | Military OneSource

Marjorie McLean, MBA, AFC®

Budget Annually. New Year, New Insights.

You know the view you get when flying in an airplane? Traveling high above the day to day, you can see much farther and gain a new perspective. You see connections-roads, buildings, neighborhoods, landscapes come together—forming patterns not seen from the ground. That’s why you need an Annual Budget.

Monthly budgets are important. Most of us start budgeting with a monthly budget. It shows what income will come in during the month ahead and then we plan what spending, saving or investing we’ll do that month with that income. However, the monthly budget only looks a few weeks ahead. It can be short-sighted. We see the trees, but not the forest.

The Annual Budget is where we see the bigger picture of the ebb and flow of our income & expenses. It will help you understand and manage…

-Income changes that come with seasonal, commission-based or pandemic impacted work.

-Expenses that vary over months or seasons, such as the inevitable summer vacations, back to school shopping or saving up for the Christmas to come and winter’s high heating bills. These are expenses we often need to save in advance for—so we need to see the expense coming up in the future and use the months before to prepare.

-Expenses that don’t happen on a monthly basis: such as quarterly, semi-annual or annual bills and obligations.

-The longer term impact of financial decisions: such as the financial changes that come with buying a home vs. renting, adding a new car payment or reducing work hours to stay home with a new child or what more we could achieve financially if we earned a promotion at work?

This is a great time to build your 2021 annual budget. If you would like assistance in expanding your financial point of view through creating an Annual Budget, contact me. I can help.

Marjorie McLean, MBA, AFC®


Is it Time for a Credit Freeze?

Who’s looking at your credit report? A LOT OF FOLKS!

Credit reports and scores are widely used not just by creditors, but by employers, landlords, insurance companies and even cell phone companies. They can affect employment, housing and the amount you pay for goods, services and loans. It is very important to keep a close eye on these reports and protect them.

One way that is now a lot easier to use to protect your credit is through a applying a Credit Freeze to your credit reports.

Credit freezes, also known as security freezes, restrict access to your credit file even by valid creditors until you “Unfreeze” or “Thaw” your report. In 2018, Federal Law guarantees that you can freeze and unfreeze your credit file for free. You can also put freezes in place for minors. If you’re ready to put a freeze in place, simply contact each of the credit reporting bureaus, and follow their process. One more tip brought to you by the Consumer Financial Protection Bureau (CFPB), don’t confuse freezes with locks. They work in a similar way, but freezes are free, but locks may have monthly fees.

Here’s more info from the CFPB: https://www.consumerfinance.gov/about-us/blog/free-credit-freezes-are-here/

In closing, be aware that Credit Freezes are not fool-proof protections, so it is still important to check your Credit Reports routinely.

Marjorie McLean, MBA, AFC®

P.S. Here's some more info on how to check your credit report to make sure all the info is accurate. Note: Due to COVID-19, these credit reports are now available WEEKLY (not just annually) through April of 2021. See this blog release from the Federal Trade Commission for more info. https://www.consumer.ftc.gov/blog/2020/05/credit-reports-are-now-free-every-week


Socially Distance from Scammers

WARNING! DANGER! BE CAREFUL! There’s so much to be concerned about in these uncertain days of COVID-19–and unfortunately financial scammers are using this time to take advantage of others.

Today’s scams are preying on financial concerns and opportunities. They’re also preying on fears of the virus. Three ways to learn more and protect yourself.

1) SIGN UP FOR SCAM ALERTS at www.consumer.ftc.gov. Daily, the FTC is posting new scams and alerts for consumers.

2) This link has 10 great tips for avoiding scams and fraud. https://www.consumer.ftc.gov/articles/0060-10-things-you-can-do-avoid-fraud

3) One tip I want to emphasize is: TAKE YOUR TIME & SEEK TRUSTED ADVICE: Scammers are going to try to pressure you to take immediate action. They’re going to threaten dire consequences if you don’t. They are professionals and very good at making people feel desperate and concerned. Take some time and before you take any action or reveal and personal information, seek the advice of a trusted friend or family member to help you think through the situation.

Just like times are changing scammers change their scams to fit the times, so be knowledgeable and careful, especially in these times.

Marjorie McLean, MBA, AFC®


A Tale of Two Carrots

Note: This blog was written pre-pandemic. Now that grocery costs are on the rise, this way to save is even more valuable.

Have you taken a look at how much you spend on food lately? Many people who create a budget and look at how much they’re spending each month are surprised by their food bill. In financial counseling, it’s often the first area that someone tags as wanting to reduce.

The Tale of Two carrots is a story of cost vs. convenience. You can use it to see if your food spending is overburdened by convenience items.

If you’re like me, you probably enjoy those super cute, tiny, baby carrots. They are so perfectly tiny that there is no need to break out a knife to chop them into bite sized pieces. However, that perfectly tiny cuteness and convenience comes at a cost. At my grocery store, I can buy a 16 oz bag of giant carrots (you know the kind with the leafy green tops) for $1.00 OR I can by a 12 oz perfectly tiny carrot bag for $2.50. Reducing those to cost per ounce, I can pay 6 cents for the big carrots, or the perfectly tiny for 21 cents an ounce. I pay 350% more for convenience.

Just a small part of a bigger story. As you likely know, this isn’t just a tale of two carrots. It’s also a tale of block cheese vs pre-shredded cheese. In exchange for the time savers of not shredding it ourselves and having one less dish to wash, we pay 165% more per ounce. Same for those fancy pre-made zucchini zoodles, packaged soups, to go salad, pre-cooked chicken breast, pre-packed kids lunches, etc. In all these areas, we are trading off an increased cost for increased convenience.

Looking to trim those grocery store expenses, start here. What convenience items are you buying? How often? How much are they costing you each month? What are some alternatives?

Don’t forget the benefits: If you decide to do more prep work yourself to save some money, don’t forget there are some side benefits. You’ll work those arm muscles as you shred those blocks of Cheddar or Monterey Jack and slice, dice or julienne those large carrots into perfectly tiny pieces.

Marjorie McLean, MBA, AFC®