Posted by: LYF | April 8, 2009

How your taxes actually get done

Every day when I get to work, I check my in-box for new tax returns.  I have a large cardboard box that sits on the top of my desk, above my computer, where new T1s are dropped off for me to complete.  Each T1 folder will contain all the information you’ve given – t slips, donations, medical receipts, investment schedules, handwritten notes etc.

Before I can actually do the return I have to sort through all your stuff.  I’ll stack all your information into piles – T-slips, donations, medical receipts, political donations, T5013’s (statements of partnership income), installment remittances –  and the number of piles will depend on how complex your return is, how messy your documents are and the volume of information you’ve provided.

Then everything becomes a data entry exercise.  If someone has a t4, I’ll key in “t4” into our tax program.  Up will pop a T4 with all the boxes emptied.  Then I’ll take the numbers from the T4 you’ve given us and enter them into the blank spaces in our software.  It’s the same process for each slip.  Things get a little more complicated when people have rental, business or professional income.  It’s not necessarily more complicated, there are just more things to keep track of, which increases the risk of missing something and ultimately requires a little more concentration.

After everything is entered, I check it.  There are two levels of checking, the first ensures everything I entered was entered correctly.  It’s surprisingly difficult to do this and not miss something.  And it gets more difficult as the time it takes to prepare the return increases.  When you’ve been looking at the same numbers for a long time it’s easy to make errors.

The second check is a little harder.  You have to look at the numbers and see if they make sense.  And I’m not very good at this yet.  If you’re doing a tax return for a lawyer, you should expect to see a receipt for union dues to a professional body.  If you’re doing a tax return for a married couple and the wife doesn’t work, then you should expect to see a spousal credit on the husbands return.  It’s more challenging than the first check, but it’s the good kind of challenging.  Not the one where you’re sitting at your desk thinking, “what the fuck and I am supposed to be doing.”  It’s the one where you know what to do and solving the problem becomes a point of effort, not a wrestling match with anxiety.

Once I’m done all that, I hand it in to my partner.  Without fail, my partner will notice something I missed or failed to consider.  This doesn’t mean I did my job poorly, it means that there’s too much going on to do consider everything and from every possible perspective.  Corrections are usually quick though.  Maybe they’ll take an hour, often no longer than 15min.

Then the tax return gets efile or printed.  After all that, the partner will call you.  Then you’ll come in and pick up your return.

An accountant’s office isn’t just a black box where tax silps go in and tax returns come out.  A lot of stuff happens in the middle.

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Responses

  1. […] "Look at last year’s file" added an interesting post today on How your taxes actually get doneHere’s a small readingEvery day when I get to work, I check my in-box for new tax returns.  I have a large cardboard box that sits on the top of my desk, above my computer, where new T1s are dropped off for me to complete.  Each T1 folder will contain all the information you’ve given – t slips, donations, medical receipts, investment schedules, handwritten notes etc. Before I can actually do the return I have to sort through all your stuff.  I’ll stack all your information into piles – T-slips, donations, medical r […]

  2. I take it you guys use DT Max? Great software, but very buggy, especially when entering T2202’s. Bleh.

  3. Nah we’re using TaxPrep. It’s pretty decent. Their tech support is unreal.

  4. I would respectfully disagree with you on that point. Someone in my office called about the length of time it takes for pension optimization calcs, and they were told that even though they knew it was an issue (taking 15 minutes to calculate the refund), it wasn’t being fixed this year. Who knows when it will be.

  5. 15min?! How is it taking that long? Mine takes at most 15 seconds.

    Whenever I have problems I email this guy – maurice.jubinville@wolterskluwer.com. He’s been pretty helpful.

  6. I don’t know why it takes that long either. I have a feeling it depends on the amount of splittable items. It also doesn’t help that I work on a networked version, but even still, other ppl in my office who work on local copies reported the same issue. Their tech support was just ridiculous to dismiss the issue.

    So far to date, I’ve found issues with:
    -pension splitting
    -T2202A form entries (when you start entering items, it zips you back to the top of the screen)
    -shares donated to a charity that had a capital gain (you need to enter the gift as the reduced rate amount, or it includes the cap gain, even if it shouldn’t)

    I’ve never used TaxPrep for pers tax but I hear it’s worse, so I guess we’re stuck with this.

  7. At least we’re not doing it by hand like back in the day. That would have sucked way too hard.


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