State College, PA - Centre County - Central Pennsylvania - Home of Penn State University

Thank Goodness for Accountants

by on April 10, 2018 4:30 AM

Yes folks, it’s that time of year. Time for everyone with an income to file their annual tax return with the federal government. And for those of us unfortunate people who live in a state that taxes your income, you’ll file a tax return with the state as well. And for those of us really unfortunate people who live in a town or city that taxes your income, you’ll file a third tax return with your local government.

Makes you tired just thinking about it, doesn’t it?

Remember those fanciful childhood years when you dreamed about what you wanted to be when you got older? All the fantastic jobs you thought you might have one day – astronaut, doctor, fireman, professional athlete, movie star. Remember all the wonderful things you would do when you became that person - fly in space, cure patients, save people’s lives, win the Master’s, and receive an Academy Award. Weren’t those dreams wonderful?

Yet, how many of us dreamt of one day becoming an accountant? Going to college, earning a bachelor’s degree in accounting, getting an entry-level job to meet work experience requirements, studying for and passing the rigorous CPA exam, and taking professional education courses to maintain your certification. Then becoming a partner in a business and helping people file the aforementioned tax returns, among many other duties. My guess is not a lot of us had that dream.

Yet here we are on April 10, and one week from today your tax returns are due. If you haven’t filed yet, dreaming of being an accountant isn’t going to help you. You need to start dreaming of finding an accountant.

That’s right, the due date this year to submit 2017 tax returns is Tuesday, April 17. Because April 15 falls on Sunday this would normally give us one extra day. But because April 16 is Emancipation Day, a legal holiday in Washington, D.C., we all get two extra days this year.

But again, if you haven’t completed your returns yet, those two extra days may not be enough for you. You simply may not have enough time, depending on how complicated your return is.

Here’s one thing about the Internal Revenue Service, they are very thorough with their instructions. Whether you can understand those instructions, well, that’s a separate topic. But there can be no doubt of their attempt to include every bit of information you might need. So much information that the IRS even tells you exactly how long it will (or should) take you to complete their forms.

In my case the IRS estimates the burden on my wife and me is a total of 21 hours to complete our return. We file a standard 1040, four additional schedules, and one additional form. Almost three complete eight-hour workdays.

Then we have a state return. The commonwealth of Pennsylvania isn’t quite as thorough with their instructions and doesn’t estimate the time burden preparing a PA-40 will take (at least I can’t find any). But our PA-40 return also includes four additional schedules and results in the same number of pages filed as a federal 1040 form. So let’s be a bit conservative and estimate our PA-40 takes 14 hours -- two-thirds the time it takes to complete a federal 1040.

Finally we have a local income tax return. This is a short one-page return that easily compares to a federal 1040EZ form, which the IRS estimates takes 5 hours to complete.

So there we have it. Our estimated burden to complete all our necessary tax returns is a total of 40 hours. One complete week of five 8-hour days doing nothing but filling out tax returns – which in many cases is just telling the government information they should already know. Sounds a bit ludicrous, don’t you think?

Which is why, if you haven’t completed your returns yet, you may not have enough time. Unless you were planning on taking a week’s vacation, or pulling an all-nighter over the weekend, if your returns are anything like ours you are running out of days.

Which brings me back to the accountants.

For decades, we had always filled out our own returns. The last 15 years or so we used tax software along with the money-management software program we use to track income and expenses. Then five years ago changes in our lives turned the process into the estimated 40-hour nightmare I outlined above, and incorporated unintelligible forms that we could no longer decipher. And that’s when we began dreaming of accountants.

As kids most of us did not dream of filling out spreadsheets and completing government forms as being the pinnacle of our life. But as someone who has found a few folks who not only dreamt it but do it well, I’m glad they did. If you are running out of days again this year, and looking to put some quality time back in your life, go find yourself a good local accountant. You’ll sleep and dream better.








1040 estimate – page 100: https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

 

PA-40: http://www.revenue.pa.gov/FormsandPublications/FormsforIndividuals/PIT/Documents/2017/2017_pa-40in.pdf

 

 

 



John Hook is the president of The Hook Group, a local management consulting firm, and active in several nonprofit organizations. Previously John spent 25 years in executive, management and marketing positions with regional and national firms. John lives in Ferguson Township with his wife Jackie and their two children.
Next Article
Letter: Pruitt Needs to Resign
April 10, 2018 4:00 AM
Letter: Pruitt Needs to Resign
Comments
Disclaimer: The views and opinions of the authors expressed therein do not necessarily state or reflect those of StateCollege.com.

order food online