Are You Making the Most Out of Your Tax Prep Interviews?

Screen Shot 2015-03-05 at 12.55.46 PM

When a new client walks through your door and sits down at your desk – you’ve got a lot of ground to cover. One of the most important aspects of being a tax preparer is being able to build relationships with new clients that keep them coming back to you year after year. Your relationship starts with the very first interaction: their tax preparation interview.

Here is a rundown of what a good tax prep interview looks like with tips on maximizing that relationship building.

Smile and welcome your client

First impressions are important. Greet your new client(s) with a smiling face. Start by offering a beverage and find out how they heard about you. Knowing where new client traffic is coming from is important. If it was a referral, you want to make sure to thank the person who referred you. If they came in because of a promotion, you’ll want to note which promotion brought them through the door.

Gather personal information

Every tax interview starts with the basics: names, birth dates, occupations, contact info, Social Security numbers, etc. You need to find this out to determine your client’s filing status and possible exemptions. Don’t just go by what your new client says their filing status is – it may be incorrect. You want to ensure they are filing properly. The only way to do this is by asking questions that will help you determine the correct filing status.

You also need to ask questions to determine any eligible dependency exemptions. Many taxpayers may not be aware of possible exemptions such as children over the age of 24 or parents that they support.

These bits and pieces of personal information you’re collecting don’t just fill out a tax form, they help establish a base for who this new client is. Think of the tax interview as more of a conversation rather than an interrogation.

Ask for last year’s return

You’ll need to know the Adjusted Gross Income from the previous year’s Federal and State returns in order to file electronically. It’s also a best practice to review the previous year’s return to make sure they filed correctly (they might need to amend the return) and also to compare this year’s with last years – there may be errors or things missed while filing.

Ask for all possible sources of income, not just W2s.

Many taxpayers do not know that some income they receive needs to be reported.

Commonly overlooked sources of income:

  • State refunds (when taxable)
  • Social security
  • Unemployment benefits.

Other sources of income you should ask about include:

  • Interest Income (Form 1099-INT or substitute)
  • Dividend Income (Form 1099-DIV or substitute)
  • Self-Employment Income (Form 1099-MISC)
  • Sales Commissions (Form 1099-MISC)
  • Pension Retirement Income (Form1099-R)
  • IRA or 401(k) Distribution Income (Form1099-R)
  • Gambling or Lottery Winnings (Form W-2G)
  • Alimony Income
  • Rental Income
  • Sale of Business Assets
  • Sale of Personal Residence
  • Stock and Bond Sales (Form 1099-B)
  • Income From Partnerships, Corporations, Trusts, Estates (Schedule K-1)

Be sure to ask about all possible adjustments to income

This is where you find out what deductions they can take. Some deductions include:

  • Estimated Income Taxes already paid (Form 1040-ES Payment Vouchers) Traditional IRA Contributions
  • Mortgage or Home Equity Loan Interest (Form 1098)
  • Medical Expenses (including Dental and Eye Care)
  • Charitable Contributions (Cash and Non-Cash)
  • Child Care Expenses

Your deductions portion of the interview is an opportunity to offer up tax planning tips that may not have occurred to the client. For example, if the client does not contribute to an IRA, talk to them about the benefits of doing so. If they do, be sure they are making the maximum allowable contributions.

Health Savings accounts are another great thing to talk to clients about if they don’t currently have them set-up.

Make sure you’ve completed all income adjustments to income before calculating itemized deductions. Both Medical and Job Expenses and Certain Miscellaneous Deductions deductible amounts will be affected by the AGI (Adjusted Gross Income).

You should ask questions to determine if itemized deductions will be more beneficial for the client. If in doubt, complete schedule A to be sure. Cover all possible deductions on schedule A. If your client has qualified work related education expenses, make sure to check other areas the qualified expense may be used to achieve the most benefit.

Determine if your client qualifies for any tax credits

There are many credits a client could qualify for – it’s all about asking the right questions. Here are links to the IRS website that list credits for individuals and businesses.

Credits and Deductions for Individuals

Credits and Deductions for Businesses

Tip: If using Education Credit, be sure to check qualified expenses to determine the most benefit.


Ask about possible estimated payments. Many self-employed and retired taxpayers make estimated payments.

Review Results and Answer Questions

Once you make it through all of your questions, go over the return with your client and explain each area. Your client needs to understand what the refund is and how you approached that number. You should also go over what their return was last year. If there is a huge difference between the previous year and this year, you should find out why (did they file anything incorrectly last year that needs to be amended, was there a change in their situation like marriage, employment or children, etc.)

If the tax refund is a considerable amount, you may want to discuss changing the withholding so that the government takes less money out throughout the year.

Tax Planning

Now that the return has been completed, it’s time to talk tax planning with your client. Discussing strategies for the current tax year will help your client pay less in taxes in the long run. Ask your client about possible changes in their situation that may affect their tax liability for the upcoming year. You also may want to review withholding or estimated payments if they owe taxes.

Review the return and see if any changes are projected due to “known” changes.

Review any Guarantee your company provides

Do you back your returns with a guarantee? Make sure your client’s know about all of the benefits and services you provide.

Don’t have one? Here’s why you should.

Thank your client and ask for referrals.

Always thank your clients for coming in and ask for referrals before you leave. If you have a referral program, be sure to explain it and provide literature or a way for clients to refer you.

Want to see a Tax Prep Interview in action? Check out our YouTube channel!

More Great Reads:

Why You Should Start a Tax Business

Don’t Operate Your Tax Business Without These Essential Tools

6 Things Every Tax Business Owner Should Do To Grow Their Business