This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Taxpayers Need to Arm Their Preparers

BERKELEY HEIGHTS, N.J. ( TheStreet) -- I was recently working on a financial plan for a couple participating in their employer's group long-term care insurance program, and right inside the policy jacket it noted the plan qualified for federal income tax purposes. Yet when I reviewed the couple's prior-year tax return I noted this information was not included.

Not providing the information may have cost them an itemized deduction. Taxpayers should not just rely on what they get in the mail for tax reporting purposes. They need to be proactive in providing their preparer with all the necessary information.

Taxpayers need to be proactive in providing tax preparers with all necessary information, including self-reported documents, or very likely lose money.

Every taxpayer gets the typical forms -- W-2s and 1099s -- this time of year, and many mechanically bring them to their tax preparer. In the taxpayer's mind, he or she is done. But many tax deductions and credits are self-reported by taxpayers, the most common of which are items are charitable deductions and medical expenses. The taxpayer is responsible for maintaining records and providing them to their tax preparer.

Why not just rely on your tax preparer to make sure you get all of your deductions and credits? Very simply, many tax professionals prepare a massive amount of tax returns in a short time. Given the volume and time constraints, they are going to prepare your return based on what you give them.

Some firms will provide their clients with a tax organizer in hopes it will prompt clients to provide information they might normally forget, but many taxpayers probably toss the organizer aside or give it a very cursory glance without much focus.

The bottom line is that you, the taxpayer, need to provide your tax preparer with all the necessary information. Failure to do so will cost you money.

>To submit a news tip, email:


Follow on Twitter and become a fan on Facebook.
Michael Maye is the founder and president of MJM Financial Advisors, a registered investment advisory firm in Berkeley Heights, N.J. He is a member of the National Association of Personal Financial Advisors (NAPFA) and has been a speaker covering tax topics at NAPFA's national and regional conferences. Maye has also been a frequent contributor to the Star Ledger of New Jersey's 'Biz Brain' and 'Get With the Plan' articles. In addition to NAPFA, he is a member of Financial Planning Association, American Institute of Certified Public Accountants, New Jersey State Society of CPAs and the Estate Planning Council of Northern New Jersey.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $95.30 0.31%
FB $100.04 0.29%
GOOG $681.81 -0.14%
TSLA $149.38 0.94%
YHOO $26.96 -0.35%


Chart of I:DJI
DOW 16,038.96 +11.91 0.07%
S&P 500 1,858.88 +5.44 0.29%
NASDAQ 4,294.4390 +10.6860 0.25%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs