Essential Questions for Choosing a Tax Professional with Corina Delugos
Have you had a hard time finding a tax preparer, or been less than happy with the match?
Many people make the mistake of picking a tax advisor without asking the right questions, only to face unexpected bills or inadequate service when IRS issues arise.
To help us navigate this, we have Corina Vakira Delugos, MBA, EA. Corina is a financial services professional with over 25 years of experience in tax, mortgage, and insurance planning. In this episode, Corina shares tips on the important questions to ask when choosing a tax professional—from understanding their qualifications and experience to knowing what types of clients they typically serve.
Here are 3 key takeaways from our discussion:
Understand Their Specialization and Credentials: Not all CPAs handle personal taxes. It's important to ask about their qualifications and the specific types of clients they usually work with to ensure they align with your needs.
Communication and Transparency: Knowing how your tax professional communicates and what they expect from you. This can include their availability during tax season and whether they provide pricing transparency upfront.
Proactive Tax Planning: Engage with a tax professional who is forward-thinking and proactive about tax planning. This approach can save you thousands of dollars and make the tax filing process smoother.
Links:
Contact Corina: www.keenfinancialsolutions.com
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Importance of Choosing the Right Tax Professional
[00:00:00] Today we are gonna be talking about questions to ask when looking for a tax professional. I wanted to cover this because I feel like a lot of people just.
Say, oh yeah, you can help me with my taxes. But then they get into it and they can't, sometimes people can't do if you get IRS audited and they can't do other things. So I think it's important to know what questions to ask to see if it's a good fit. 'cause I know that in the past.
I have had a CPA and then it's like I get this bill and it's for thousands of dollars. And then I'm wondering, what they did and I didn't ask ahead of time. What I was supposed to do. Yeah.
Guest Introduction: Karina Ra Degos
So to talk about this, I have Karina Ra Degos. MBA here. Thank you for joining us. Oh, it's my pleasure.
Thank you for having me. Yeah. Karina is a financial services professional with over 25 years of experience specializing in tax, mortgage, and insurance planning. She's the owner of Keen Financial Solutions here in Phoenix, Arizona. She's passionate about helping families create and protect wealth, increase liquidity, and [00:01:00] reduce tax liability.
Yeah. So let's get started. Let's, yeah. So thanks again for taking time to be on here. I appreciate it. Of course. Karina and I have a lot of mutual interests, I should say in terms of real estate and the way that we look at numbers. And so we are like-minded in a lot of ways. So I had her on.
Yeah. Okay.
Common Issues with Tax Professionals
So the topic is questions for when looking for a tax professional and Karina, you actually brought this topic to me 'cause do you see this a lot in what you, in, in your job, yeah. What I notice is when people come to me, I ask them about what has your previous experience been? Tell me, 'cause I wanna understand what their pain points are.
And oftentimes what I've come to learn is that folks will simply. Get into an engagement with a tax professional, A CPA. Some of them are just simply not credentialed and don't have much experience and they don't ask any questions. And then when I get to their return and I'm reviewing them and [00:02:00] I'm asking more questions to understand their situation or to understand why certain things showed up on their return.
Clients have no idea because they, they didn't have a good experience in that their tax professional, even A CPA too didn't take the time to go through and explain to them their tax return, what each page means. And so they come to me sometimes with really not knowing much and not knowing what to do about it.
So they just feel totally in the dark where I don't even know what questions to ask.
Key Questions to Ask Your Tax Professional
So I developed a. A guide of questions to, to help clients or really just the general public. Here's some questions that she'd be asking when you're engaging with a tax professional and they're really critical to understand each other because like you said, it's important that it's a good fit.
Yeah. That you guys have the same communication style, that your expectations are aligned, that if you expect to have a sit down with your. CPA, your tax professional, your enrolled agent, [00:03:00] that there's an expectation that there's gonna be some time spent to help educate you so that you can understand what's going on.
Oftentimes when I'm working with somebody on a mortgage and I look at their returns, and it's the first time I'm seeing them because they're not necessarily a tax client. I'll have questions for them that they can't answer and they have no idea why they have a Schedule C, for example, when they don't have a business.
And so it's really important to ask good questions, especially around what are your qualifications and credentials. Where did you not necessarily where did you go to school and that kind of thing, but where did you get your experience? Was it through practical work? Was it through doing something doing returns for your friends and family?
Only? That's really important because you wanna get an understanding of their level of experience, especially if you're a business owner. I know you and I work with a lot of business owners and investors, it's really important for business owners to understand what's in their return. Because when you go for financing, there are some questions that will come up as a, from that return that you're gonna [00:04:00] wanna have answers to.
And if you haven't been educated by your tax professional, it's gonna be really difficult for you to have that conversation. 'cause some of these things, when we're looking at tax returns going back two years, sometimes three. You've forgotten. Yeah. You didn't you don't remember. And so it can make things a little challenging later on down the line.
And I find it, I found it very interesting. 'cause I have some friends that are CPAs and they don't do any personal taxes at all. Yeah. They're like, no, I work for this business. I work for this such and such business, or all I do is business valuations. Or, they don't even know how to do personal tax returns.
And we also, we all assume, Hey, you're a CPA, you know how to do tax returns. That is a great point. Yeah. Maybe a lot of folks don't understand or don't realize, just the general public, you think CPA and it's probably because we've done a terrible job at marketing and educating the public on what it is that a CPA. Does, because some CPAs, like you said they do business valuations. They only handle audits and resolutions. They don't look at tax returns. They could be working on financial [00:05:00] statements for mergers and acquisitions. So not every CPA does any tax returns.
There's many CPAs who don't. And in fact, there's a shortage of accountants in the country right now. Yeah. And us. Part of the accounting community are trying to bring more young people in because they're, the larger firms are really one, taking, filling in the gap on that lack, that pipeline that's missing for this particular industry and this field.
But also to make sure that we have a robust, trying to get more women involved in the business and doing more recruiting to be able to get more accountants in especially on the tax planning side. Which is really needed because folks are, for the most part, lost on why is my tax bill this way?
How am I taxed? It's not something that we learn in school. It's something that if you were. Personally interested in, you have to go seek that information out. Unless you have a tax professional who is more proactive in their education. And, and I am that way.
And then during tax time, it's not like they have time to educate everyone either. Yeah. It's almost okay, I [00:06:00] got this tax return done. It's done. We're gonna have a 10 minute phone conversation over it. And then, I'm onto the next one. And oftentimes the tax preparers, those of us who are doing it, we are very busy.
And so that time is limited and that's why it is important that when you're thinking about engaging with somebody, that you ask them about, what can I expect in terms of your availability. During tax time, will we be going over my return before filing? Because those are things, how do you communicate, how do you communicate those kinds of things so that you have that expectation.
And another thing that's really important you had mentioned it, getting a bill from your CPA that was unexpected. What's important for us, one of the things that is important for us here at Keen Financial Solutions is pricing transparency. So we give you your pricing upfront. So that you know exactly how much you're going to pay.
That's really rare because I, when I was having to find a new tax preparer, it was really hard to it depends on how much you have and, yeah, that's a tough one. And so we base our pricing based off of, it is a subscription [00:07:00] model, but people do have the option to pay upfront. One, and if they pay all at once, then it comes out a little bit cheaper for them.
But one thing to, to talk about and to mention, I'm losing my train of thought here. 'cause I have too many things that I'm thinking about. Yeah. Was the upfront pricing like understanding. What is it that, that you need? I had a client just recently acquired a client who he was sure he was a Schedule C, but then later we come to find out that he actually has an S corporation, so we're actually doing his taxes under the S Corporation guidance, which is different.
So it's important to understand what that is, and that could be some of the reason why some. CPAs or tax professionals will won't be able to give you a price until after 'cause they don't properly understand it. But that's why it's important to ask those questions upfront. Yeah, it is. And at least they could give you an estimate.
And I find it interesting too because as I have switched tax preparers or CPAs through the years most of the time the new one I go to says, oh, this one wasn't done right. And that's what I find interesting too, is that it varies so [00:08:00] much on, is it the knowledge that people have? Is that what it is?
It could be a difference in knowledge, but also a difference in strategy. Okay.
Understanding Tax Strategies and Client Expectations
And I think that's why it's important to work with the tax professional who has a forward thinking approach, who is proactive in terms of the tax. Planning. Because when we get to the tax preparation piece, your, it's already after the fact.
I've had clients come to me who are like, Hey, I don't understand why I'm paying capital gains on the sale of this house when I lived there for 25 years. But the last five years it has been a rental. They didn't properly understand how that. Primary residence exclusion works. And that it didn't apply to them because they had been, this property had been a rental for so long.
So when you do tax return and you're not having those pre-planning conversations, regular conversations with your tax professional throughout the year when you're planning on buying a property, that's what I think is so important. Yeah. Is that come October you need to be thinking about, if you're not, don't just a straight job with 401k and [00:09:00] own your house.
And that sort of thing. If you have other things, going to your tax preparer and doing some planning in October can just save you thousands of dollars. Oh, absolutely. Absolutely. Because I, it's totally worth it. Yes. And then it's so much easier in April. Totally. So it could be a difference of strategy.
But the other thing is that there, there are, there's. It, you can go about preparing the return and including or excluding certain expenses and putting them in one place versus another. Treating something as an asset versus just deducting mileage. For example, if we're talking about vehicles, there are different strategies that people employ.
So when you go from one to the next, it may not necessarily be that it's wrong, but maybe they took a different strategy. Strategy. So how would you ask a question about what their strategy is? Because I think some people just know to ask. How aggressive they are. Yeah. Because I think it, that's what you hear is how aggressive is someone versus are they towing the line of whether that's legal or not, or straight and narrow.
Those are the only two kind of things that you hear. So is there a way to ask about their strategy? [00:10:00] You, at least I can say that the way that we approach it is that we're looking more at what are your goals? What are you trying to accomplish? What are some of the things that you're thinking in the future that could potentially happen?
Are you thinking of starting to, you wanna acquire a couple properties throughout the year and maybe do some 10 30 ones exchanges? So the strategy is going to depend on the goals of the client. Where are they trying to get you to? Are you trying to get to a zero tax bracket By the time we get to, to, to retirement?
Maybe not. So it just really de depends on what their goals are. On what the goals are. Okay. And understanding if there's a W2 employee and both, husband and wife, if it's a couple if they're both W2, our strategies are gonna be limited. But if they're a business owner.
And they're a property investor, then we open up and can unlock many more strategies that we can employ. Okay. All right. I think all of this sounds really good. And so that would cover like what kind of clients do you normally work with? Yeah. Yeah. Because that was one of the questions that you recommend is asking what kind of [00:11:00] clients do you typically work with, right?
You wanna ask what kind of clients do you typically work with, because if you're a business owner. Let's just take myself as an example, right? I'm a business owner. I have three different product lines. You could have several different product lines or services siloed individually under an umbrella organization.
If you go to a tax professional and you don't ask them what kind of clients that they work with, like business owners, do you have experience with business returns? If you don't ask those questions, you might be getting somebody who only does W2 employees and has no idea about an 1120 I Now, did you bring that up?
I had that happen. I submitted all my stuff and I had flipped a house and she just said, I can't help you. I don't know what to do. Yeah. So I was like, oh, okay. And I was really late and it was. It wasn't good. Yeah. So it's important to know. Yeah. Do you have experience helping people like me?
And it's, it's a good question. Hey, do you have a reference? Do you have somebody in your clientele that is similar in business structure as me, that I could talk to [00:12:00] about. And if they're a good professional, they'll gladly give you some referrals of folks to talk to to let them know, because they know people know what it's like.
And I think that brings us to another question is recommendations that you recommend that you ask for recommendations and then call them Yeah. For references. Just like you would if you're hiring anybody. This is your money that we're talking about. So you wanna take the same sort of care and due diligence that you would when you're.
Trying to work with any other financial professional. Okay. And then, so we talked about fees and then what about. Let's talk a little bit about what's expected of the client, because that's what I always find very helpful is not only the communication, what you can expect, hey, we're gonna talk once a quarter, or, whatever it is.
But also what do you expect from the client is a good question. Oh yeah. Also I would, if I were the client, I would definitely want to know what my service provider, what my tax professional needed out of me. Because I may not be able to necessarily deliver, or I may need to say, Hey, do you guys have any additional services in terms of [00:13:00] support that could help me with this?
Yeah. Certain things like my expectation. Would be that clients need to have a record of their receipts. They're expected to keep certain logs on mileage. I expect them to keep their receipts and save them and have, it doesn't have to be perfectly organized, but at least they need to have them and they need to have them to exist.
'cause I'm gonna ask them to, do you have records and receipts of these expenses that you're submitting? I don't need to see all the receipts. In fact, it's better that I don't, but you are going to need to put together your list of expenses. I'm not gonna be able to tease those out if you just give me your bank statements.
Especially if you get your groceries and some office supplies at Walmart. How am I gonna distinguish if. This expense. Yeah. You need a bookkeeper for that. Yeah. You need a bookkeeper for some of these things. And we do offer bookkeeping services if people need that. So there's a certain amount of ex of organization that is expected.
I certainly expect my clients to re be responsive if I'm asking questions that I'm actively working on their return within a reasonable amount [00:14:00] of time. Otherwise if folks don't get back to you with those questions. You can't move on with that return. Yeah. Because 'cause some things depend on another Yeah.
And I find that, and I don't know if this is true for you, but in my industry, that a lot of times people just wanna push all their stuff to me. Yes. And just, okay okay, you do it. And I'll do whatever. And it's really a partnership. I need them to do things. I need them to be thinking about things and, hey, I would like to do this because I'm not a mind reader.
And if I don't know, just simple things like, I don't know that you changed your last name. You need to tell me that. So that. You know what I mean? Yes. There just needs to be a partnership versus I, because I feel like a lot of people just want to avoid the whole money thing. And they just wanna hire somebody to just do it for them. Yeah. And that's not what. We are. And because I need, and you probably do too, it sounds like you need your clients to be an active participant in their own wealth creation. As much as they might want to avoid it and just hand it all over, you've gotta [00:15:00] participate.
And we've gotta talk about it. We can talk about it. It doesn't have to be an emotional conversation. These are just numbers. Yeah. We just need, I need to understand and be able to tell the story because if. The IRS has three years to reassess tax. So if you get audited at any time and there's a reassessment, I need to be able to understand what's going on because if I'm going to be representing you in front of the IRS in communications with them, especially if we have an audit, an examination is what the IRS calls it, or we have something that we need to resolve.
I can't be a good advocate if I don't know the whole story. Let's, and let's go into that too. Do, that's one of the questions that you need to ask, is about do they do audits? Yes. Because do not everybody doesn't do IRS audits, right? Yeah, that is correct. Okay. I don't do IRS audits.
I usually refer those out to a partner that I work with that has a, an audit if it's a reassessment of taxes. That is different than you need to do an examination and we need to, we need certain books and records that may be out of scope for us, where we're going to hand [00:16:00] that over to another firm that, that will be more equipped to handle.
That just depends on the type and expanse of your business. If you're a sole proprietor and you're using a Schedule C, even if you have an LLC. Z That would be something that, that would be within our scope of services. But anything beyond that, if you had a business return and you had multiple businesses, we would outsource that and put you in touch with competent tax professionals who specialize in audits.
Okay. All right. I think that sounds good. 'cause I know that some people you have to specialize in it, right? Yes. And you have to be like, licensed with the IRS in order to do this. And that's an important point that you bring up. So there are only three credentialed profess types of pro.
Professionally credentialed folks who can represent clients before the IRS, and that's in a CPA, an enrolled agent and a tax attorney. If you're working with somebody who isn't one of those three. Their ability to represent you or to just communicate with the IRS or even the Arizona Department of Revenue.
I [00:17:00] have a client that it's no better than you calling. It's no better than you calling and being on hold for hours. So if you need, they have an inside track. And if you are somebody who is running a multiple businesses, you're very busy and it's something you do legitimately need to delegate to us, great.
You can certainly do that. We will hang on the phone and do that. Certainly there's gonna be added additional cost and at that point it's a matter of how much is your time worth. Are you gonna be better off focusing on your work and delegating that to us and then we'll, have our folks sit on the line with the IRS and discuss this for you on your behalf, and then come back and say, Hey Jim, this is how it turned out. This is where we landed. What do you wanna do from here? Would it be better if you were just like on the phone? If the client was on the phone too?
Not necessarily. Really? Yeah, because it's just a step-by-step process. Because sometimes we're getting off track here. I'm just wondering for my own information of the, your client is gonna wanna say everything that they feel like they need to say for the IRS to understand and most of the time the IRS just simply doesn't care.
Client Confidentiality and Data Security
So the last question that we have here is [00:18:00] how do you handle client confidentiality and data security? Oh, that's a really big one. So we have layers of protection with an IT department that we work with. So we have a, a third party. It. Contractor that seals up.
We use vpn, so virtual private networks. We don't log on to virtual, or I'm sorry, public networks. So we restrict some of the access that our employees can have and to use with each of our client data so that it's on a need to know basis. If we have another accountant on staff who is working on different cases and they're not assigned to that case, you can't go into and look into that customer's portal of.
Documents and information if you are not an active person, engaged and authorized with that particular client. Okay. All right. If we have some internal safeguards and then of course having the protection that we need on the external side to make sure that I. The bad malicious things, phishing aren't coming in.
So we have our third party company and they're regularly doing tests to see whether any of us [00:19:00] are clicking on a link that we shouldn't be clicking on. The spoofing, the phishing and things like that. Oh, they do the testing, phishing emails. Yeah. Yeah. Some of those are actually really. Very tricky. Yes.
Yeah. Yes, I know. They're very, I know definitely companies that do that. Okay. So some of the questions just to recap you guys of things that you should ask when you're looking for a tax professional are, what are your qualifications and credentials and what types of clients do you norm typically work with, and what services do you offer?
Ask for some references from some other clients. And I do think another big one is what's your approach to communication and how will you be able to contact them or communicate with them, especially during tax season. Yeah. What's the easiest way? Because sometimes hi, they hire like temporary, yes. Yeah. Help and things like that. How much do you charge for your services and how do you handle the client confidentiality? Confidentiality and data security. And then what are your expectations for me as a client? I would actually put that at like number three. I should have moved that up there.
That, [00:20:00] that should go Yeah. Last, but maybe just maybe because we do what we do is that we think that is. Yeah. But Right. It's up to us. To also say that too, but I think a lot of those are very important things and I just think that a lot of times we just go with whoever, oh, my friend, yeah.
Recommended so and and I don't even know if this is good. I'm guilty of that. Personally, I'm absolutely guilty of it. And over the years I have learned to ask questions. And then I look at things and I'm like, ha, why are we even doing this? And I do what I do and I don't even review, I review my taxes, but then I wasn't reviewing the quarterly documents that were going.
There's just so much detail. Yeah. That to review all of it. It does it, it does take a lot. It does. And I see why people want to just offload it because it is a pain. It can be overwhelming. It certainly can be, and that's why it's really important to make sure that you have trust and confidence in the person that you're working with.
Yeah. Because there are, I've seen some really bad things out there. The biggest bad thing that I've seen are, folks who are working [00:21:00] with un credentialed and unlicensed, unexperienced tax, I'm not even call them professionals 'cause I do think they're scammers where they don't even sign their return.
They don't, they're not authorized. They don't have a P 10, which is your payer's or preparers tax identification number that each of us who are legitimate preparers and we have authorization by the IRS we're connected with them. If you have a return or you're looking at a return from a friend or family member and it's not signed and they tell you it was repair prepared by somebody else, you should have that one looked at by a professional.
Because I've seen things where Schedule Cs are simply just made up out of thin air and the client doesn't even have a business because they don't know. Because they were just trying to get the tax deductions. They were trying. Yeah, they were. Because the preparer was trying to. Increase their refund.
I've had clients come to me and say, yeah, that's what I mean. They were trying to, yeah. Oh, I just used somebody at work that everybody else used because they said that this person gets them really good refunds. Yeah. And that I, that is a [00:22:00] common thing of that. I don't know how he did it, but he got me, to pay no tax and Right.
I just think that if you don't want to get in trouble and you need to have somebody that. Knows what they're doing and you're gonna have to pay for it. And it's not like you have to pay an arm and a leg, but you do need to pay for it and don't cheap out on it. Yeah. Because when you cheap out on it, that I feel is when really bad things happen.
Yes, absolutely. And that was the case with this particular gentleman. This person was only gonna charge me a hundred bucks and I got a $400 higher refund than I did last year. And I said, is it worth it at to be at risk? Yeah. To have to deal with this when the, and then pay all the penalties and to pay the penalties and the interest that, that accrue on that.
Absolutely. For 400 bucks, I don't think it's worth it. I know, but Yeah. But everybody does it differently. Yeah. And Arizona doesn't regulate tax preparers like some other states do, so that's why it's. So rampant and why it's so critical for you to ask really good questions. Yeah. To make sure that you're getting the right services that you need.
Okay. Thank you so much for joining us and thank you everybody for listening. If [00:23:00] you enjoyed the show, be sure to leave a review. You need to scroll all the way down. I would love to have your feedback. And if you leave the review, it helps us with the algorithm and reach other people. So have a great day.
Disclaimer: The information provided in this podcast is for general informational purposes only and should not be construed as professional financial advice. Always consult with a qualified financial advisor or professional before making any financial decisions. The hosts and guests of this podcast are not responsible for any actions taken based on the information presented.