How to Prepare Your Taxes for an Accountant

Someone at church this past weekend asked me if I could prepare her taxes for her, and while I’d love to be able to help, I know that taxes are just NOT my thing! I personally have not done my own taxes for about 5 years now. Even when I was doing my own tax prep, I questioned myself every step of the way.

While I wish I had all the great advice about filing your taxes and how to save more on taxes and maximize your deductibles and everything – Taxes are just not my thing!

Even though I can’t help you actually file your taxes, what I can share with you is how to prepare your taxes for an accountant. Specifically, how we prepare all of our finances for our accountant so he can then do the important job of preparing our taxes!

How We File Our Taxes

We have an accountant that prepares our taxes.

Before my husband and I got married, my taxes were super simple, it was just myself. I had a typical salary job. I didn’t have any other income producing assets. And I didn’t know anything about itemization – and I probably wasn’t giving or doing enough with my money to qualify for any big deductions.

Once we got married, we bought 2 rental properties within the first year of marriage. My husband had a number of different income producing investments that he brought into the marriage. I started my blog, I changed jobs, and we were joint filing for the first time. Taxes became real complicated, real fast…

Not only that, but my husband already had someone doing his taxes for him, so we decided to continue doing that. And WOW am I thankful.

It’s expensive – especially since we’re filing taxes in a handful of different states because of where our rental properties are and some of the investments my husband is a part of, but it is worth it because just thinking about trying to tackle that on my own sounds like a big headache.

The other thing to note is that we actually file for an extension. This is due to some of those investments my husband is a part of – we have to wait for all the income reports to come in and they typically don’t all come in until the fall after! So we file for the extension and pass everything along to our accountant to handle.

If you are having an accountant prepare your taxes for you, learn exactly how to prepare your taxes for an accountant in this article. What documents do you need to send to your accountant and how to organize them. — PIN FOR LATER

Gathering Info Together for Accountant

I wanted to share a list of what documents we pull together for our account. This is NOT an extensive list of documents you will need – this is only what we put together based on our own situation. So if you want to know more about how to prepare your taxes for an accountant, check out this more extensive list.

Our Incomes:
- Husband is Employed: W-2s
- I am Self-Employed:
  - 1099-MISC
  - 1099-NEC
For My Business:
I am a real estate agent, run a blog, and a coaching business. Our LLCs file their own taxes so we send over
- Records of Income
- Records of Expenses
My accountant asks for all our bank and credit card statements. I also keep all the receipts and invoices in a folder for him as well.
Rental Income:
I send over all the owner statements that our property managers send us in those statements you will find:
- Expenses (all the invoices)
- Income
My accountant has kept track of all the asset information (like appliances) to account for depreciation.
Mortgage interest statements
Real estate tax records

Savings & Investments:
Interest & dividend income (1099-INT, 1099-OID, 1099-DIV)
HSA reimbursements
Retirement account contributions

Giving Statements:
We receive giving statements from these different charitable donations we make:
- Tithe to our church
- Gifts and donations to missionaries, ministries, and non-profits we support
Mileage:
I drive a lot as a real estate agent, so we have an awesome app that keeps track of all our mileage which is then tax deductible.
We also report miles driven for charitable or medical purposes which is also tax deductible!

Economic Impact Payment (EIP)
Information about our stimulus payments — also known as an economic impact payment (EIP)

Our Budget Spreadsheets
I keep very detailed budget spreadsheets (Check out the exact budget spreadsheets we use) and hand those over to our accountant as well and he uses that to get details about different expenses we had throughout the year.

The Money Taboo a weekly faith and finance devotional with Katie Jones

Where We Put The Docs

I file everything into different folders in Google Docs so that when it’s all set, I can just send a link that only can be opened by my accountant and he can easily access and download all of them.

I try to organize them as best as I can – separating everything for our business and personal life. And breaking it all down inside of each of those, by income statements, giving statements, interest paid & earned statements, bank statements, business expenses, incomes, etc.

Keep Your Sensitive Information Safe!

I wanted to make a quick note that it is extremely important that you protect yourself and your sensitive information especially when using cloud-based storage.

According to Business Insider, “Google Drive is generally very secure, as Google encrypts your files while they’re being transferred and stored.However, Google can undo the encryption with encryption keys, meaning that your files can theoretically be accessed by hackers or government offices.”

Precautions You Need to Take

You definitely want to ensure you are taking all the appropriate precautions to keep all of your sensitive information safe! You can make Google Drive more secure by using two-factor authentication, setting a good password and being careful when giving other apps permission to use your Drive.

After reading that article, I went through all of the apps that were connected to my Google Drive. I realized there were a TON of apps connected to it that I never use and so I deleted a large handful of them.

We try to change our passwords a few times per year as well – it’s something I want to get better at in order to protect our information!

I also highly recommend having Identity Insurance in the case that your personal information does get stolen then you are covered!

We recently switched to a new identity insurance this past year – Zander. We really like them and they offer Antivirus software and VPN software to help us stay protected as well.