You can take the mystery out of your client’s future tax return today; using our Tax Planning Tool built into Wintax.

Today we want to make you aware of one of our powerful tools called “Tax Planning”. This is a tool that is embedded inside your program so there is nothing to add or install. Simply make sure your Wintax program is up to date and you are ready to use it.

The Tax Planning tool estimates what your client’s tax return may look like next year based on the new 2019 tax rate schedule, standard deduction increases, and a few other inflation items that have been published. More details will be added as we receive additional published tax law through the IRS provided forms and publications.

To use it, simply recall a client and go to the “Summary” page of the tax return and select option “[29] Tax Planning”.

This will open the main Tax Planning page. The program allows you three different tax planning models. Select which model you would like to work on and enter a description if desired. Some clients may just want a quick estimate of what their taxes may look like next year and some may want to know what that tax profile will look like if they sell a rental or lose a dependent. Whatever the case may be, the flow and procedure is basically the same.

1. First, the program will make a copy of the existing tax return and use it for its model. Running tax planning is completely non-destructive to the original or real tax return.

2. After the model is selected and labeled, access the applicable areas of the program using the buttons on the left side of the tax planning page. If you need to change a filing status, or add/delete a dependent select “[40] Basic Information”. To make changes to the actual tax return numbers, access the applicable forms and or schedules by either selecting “[10] Forms/Schedules” or “[11] 1040 Line Input”.

You will note that as you make tax planning changes, the program will keep bringing you back to the “Tax Planning” page instead of the “Summary” page. This is because you are currently in the tax planning mode which is only working with the copy of the tax return and is not affecting the original tax return at all.

3. Once you are finished with this model’s adjustments then you are ready to print or preview either the smaller “Display Summary” or the more extensive “Detail Summary” report. Both of these reports have three columns that show the current year numbers, the projected numbers for next year, and the net change/difference between the two. Both of these reports do a comparison between the data on the original tax return, and the tax planning copy of that tax return with the adjusted rates and deductions currently available.

Display Summary Report

Detail Summary Report

4. Once you are finished running your tax planning models for that client’s tax return simply select “[41] Exit Tax Planning”. The program will close your tax planning tool and take you back to the original tax return “Summary” page. Be careful not to accidently make unwanted changes once you are back to the original tax return as you are no longer in “Tax Planning” mode.

We hope that you find this tool beneficial to your tax practice. Please check out our videos, news, and blogpages for other great tips and information.

Taxware Systems has been developing tax and accounting software since 1979. Feature for feature, Taxware’s programs are the fastest professional tax preparation system on the market.

Take a tour of our software at www.taxwaresystems.com/discover

The IRS just issued an updated publication with information for individual taxpayers and business owners unable to pay their taxes. This electronic pub, Offer in Compromise Booklet, helps people understand how an offer in compromise works.

An offer in compromise is an agreement between a taxpayer and the IRS that settles a tax debt for less than the full amount owed. An offer in compromise is an option when a taxpayer can’t pay their full tax liability. It is also an option when paying the entire tax bill would cause the taxpayer a financial hardship. The ultimate goal is a compromise that suits the best interest of both the taxpayer and the agency.

When reviewing applications, the IRS considers the taxpayer’s unique set of facts and any special circumstances affecting the taxpayer’s ability to pay as well as the taxpayer’s:

• Income
• Expenses
• Asset equity

The booklet covers everything a taxpayer will need to know about submitting an offer in compromise, including:

• Who is eligible to submit an offer
• How much it costs to apply
• How the application process works

The booklet also includes the forms that taxpayers will complete as part of the offer in compromise process.

More information:

• See if you pre-qualify for an offer in compromise

*This message was distributed from IRS Tax Tips. For more information on federal taxes please visit IRS.gov.

Towards the end of tax season, we field some telephone calls helping clients transmit extension form 4868 for their clients. When the telephone call is about finished the client will make a comment something along the lines of “thanks, one down 40 to go!”. It’s about that time Taxware customer support becomes their best friend when they let them know that there is an easier way to do all their extensions in a batch.

In the program we have a utility that compares your current year data folder with your prior year data folder to build a database of the tax payers you haven’t recalled and worked with yet. With this database you can send extensions in a batch. In addition to its main functions there are some other great reports and tools.

Here is a link for a step by step guide showing how to use the comparison tool and how to batch e-file extensions.

Taxware Systems is always looking to provide information and technology that could benefit and improve the tax practices of our clients.