Finding right tax accountant can save money now - and later

By , Business correspondent of The Christian Science Monitor

There's a piece of unsolicited mail arriving in American's mailboxes these days that most people will not automatically throw away: federal income tax forms.

As people look at the forms and pages of instructions, they will be trying to figure out if the tax-cutting law passed last summer will make any difference in how much they will pay Uncle Sam this year. They will also be wondering if they can find a way to pay less next year.

Many of these people will be candidates for the services of a professional tax accountant. How do you know if you're one of them? And if you are, how do you find an able accountant?

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In the first place, if you are in a high enough tax bracket that you're already using a tax accountant, the new law makes it even more likely you will use the accountant again this year. Not only are taxpayers eligible for more deductions, but the changes will probably mean entirely new tax-planning strategies will have to be drawn up for next year and the years after that.

For others, there are a number of reasons that paying for professional tax preparing assistance and advice could prove a worthwhile investment.

* If you started a business, even if it is only part time, you are earning money from a new source and living in a new world of tax payments. Ideally, you should have consulted with a tax accountant before you started the business, but better late than never. Some of the things you and the accountant might discuss include deductible business expenses and depreciation of equipment, cars, and buildings.

* Did you retire in 1981 or are you planning to retire soon? If so, you're probably in a lower tax bracket and receiving income from a pension and social security. You may also be starting to receive dividend income from your investments.

* Did you recently buy your first house? While young families often go through home purchases without specialized tax advice, using a tax accountant at the time of the sale or when tax forms are filled out later could yield several good tips that could save you money for many years. And unless you move into tax shelters or other investments, you may not need the adviser again for some time.

* Speaking of investments, ''If a person has substantial capital gains after June 9, 1981, they definitely should seek an adviser,'' says Vernon K. Jacobs, a certified public accountant and tax specialist in Kansas City, Kan.

Once you have decided you need a tax accountant, how do you find one that has the experience, specialized knowledge, the patience to lead you through the intricate tax laws, and the ability to apply them to your situation?

A few people, mainly top corporate executives, receive tax planning and preparing services as one of the perquisites of the job. Often this perk means access to a partner of one of the ''big eight'' accounting firms.

But for the rest of the people confused by tax laws and regulations, one of these larger firms may be too big to provide the personalized service they need. They may also be too expensive, with fees ranging up to $1,000 for tax-form preparation and year-round assistance. Thus, most people will be selecting a specialist from a small-to-medium size accounting firm or an independent adviser who operates out of a private office or even their home.

One thing to remember when looking for an accountant: It doesn't cost anything to make a few phone calls and ask the accountants if they handle accounts like yours, what areas they specialize in, about how much they charge, and how much experience they've had.

''It's nice for a new person to gain some experience,'' Mr. Jacobs says. ''But not on my dime.'' He thinks an accountant should have at least five years experience.

One basic question Jacobs reminds people to ask is whether the accountant regularly deals with taxes or just helps people fill out forms as a sideline between January and April. You want somebody you can call during the year as you sell property, stocks, or make other investments.

You should definitely avoid a tax adviser or accountant who says something like: ''I guarantee to cut your taxes dramatically.'' These people will probably agree to list every deduction you can think of, and may try to come up with a few more on their own. There is less of this going on in the last two or three years, however, since the Internal Revenue Service began slapping penalties on overly aggressive tax preparers.

If that wasn't enough discouragement, the tax-cutting law passed by Congress hit taxpayers with harsher penalties for underpayment. This year, the penalty - pegged to the prime interest rate of last February - is 20 percent of the amount underpaid.

On the other hand, if an accountant says that in many years of preparing taxes, no client has ever been audited, that may tell you he has been much too conservative and not given people all the deductions they could legally claim. Social security and IRAs

Q. I am on social security and working part time. Can I open an individual retirement account through payroll deduction, even though I am over 591/ 2? Also , what effect do IRAs have on social security payments?

A. As long as you are under 701/ 2, you can make contributions to an IRA. Above that age, however, you are supposed to begin making withdrawals from the IRA, so you would not be able to make new deposits.

By itself, an IRA account would not affect your social-security payments. The only thing that affects social security is the amount of money you earn at your part-time job in the year.

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