Tax Autopsy

Back in 2008, 2009, and 2010 I did quite a few tax returns that were really tax autopsies. I seem to do fewer returns of this nature today; however, I unfortunately still do several of these each year. To me a tax autopsy is when I do a return for a client or a couple who owe a very large amount of tax and they could have avoided it or deferred it if they had just talked to a tax professional before the end of the tax year. There is no reason to ever have a tax autopsy.

One example of a tax autopsy is a tax return I did for a client who withdrew a couple of hundred thousand dollars from a retirement account at age 58 to purchase a second home. Another example is a client who was laid off from work and his company retirement plan paid him a very large distribution from his 401K plan and he did not roll this into another retirement plan. A third example is a client who recently inherited several traditional retirement plans and decided to have all of the money paid to them from the inherited retirement plans not realizing that this entire amount would be taxed. Most of the tax autopsies I perform are for new clients; however, occasionally one is for a current client and these really break my heart.

If you have a major event that may effect your taxes please call a tax professional and get some advice. The tax code is complicated and a fifteen minute conversation with your Certified Public Accountant (CPA) can sometimes save you tens of thousands of dollars. I have had many such conversations with my clients who predominately live in the greater Fort Wayne, Indiana metro area.

Mike Sylvester, CPA/ABV, MBA

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