Tax Preparation Support

Organize financial records into tax-ready reports that an accountant can use directly or that the business owner can use to file accurately.

Read these when needed

• Read references/TAX-PACKAGE.md before delivering a package to an accountant or tax preparer.
• Run scripts/tax_package_summary.py when you already have package artifacts and need a deterministic completeness summary.

Disclaimer: This skill organizes financial data for tax purposes. It does not constitute tax advice. Tax rules vary by jurisdiction and change frequently. Always consult a qualified tax professional for advice specific to your situation.

When to use

Use this when: tax season is approaching (Jan–Apr for calendar-year filers), the user's accountant requests organized records, quarterly estimated payments are due, or the user is catching up on prior-year filings.

Prerequisites

The quality of tax prep depends entirely on the quality of the underlying data. Before generating reports, the user should have: processed receipts, categorized expenses, and ideally reconciled bank statements. If any are missing, run those skills first. Fastest path from zero: extract receipts → categorize → reconcile → generate tax reports.

Step 1: Gather business context

Step 2: Generate the P&L mapped to Schedule C

REVENUE
  Gross receipts or sales                    $XXX,XXX.XX
  Returns and allowances                     −$X,XXX.XX
  ─────────────────────────────────────────
  Net revenue                                $XXX,XXX.XX

COST OF GOODS SOLD (if applicable)
  Cost of goods sold                         $XX,XXX.XX

GROSS PROFIT                                 $XXX,XXX.XX

OPERATING EXPENSES (Schedule C Part II)
  Line 8:  Advertising                       $X,XXX.XX
  Line 9:  Car and truck expenses            $X,XXX.XX
  Line 10: Commissions and fees              $X,XXX.XX
  Line 11: Contract labor                    $X,XXX.XX
  Line 13: Depreciation (Form 4562)          $X,XXX.XX
  Line 14: Employee benefit programs         $X,XXX.XX
  Line 15: Insurance (other than health)     $X,XXX.XX
  Line 16b: Interest (other)                 $X,XXX.XX
  Line 17: Legal and professional services   $X,XXX.XX
  Line 18: Office expense                    $X,XXX.XX
  Line 20b: Rent (business property)         $X,XXX.XX
  Line 21: Repairs and maintenance           $X,XXX.XX
  Line 22: Supplies                          $X,XXX.XX
  Line 23: Taxes and licenses                $X,XXX.XX
  Line 24a: Travel                           $X,XXX.XX
  Line 24b: Meals (at 50%)                   $X,XXX.XX
  Line 25: Utilities                         $X,XXX.XX
  Line 26: Wages                             $X,XXX.XX
  Line 27a: Other expenses                   $X,XXX.XX
  Line 30: Business use of home              $X,XXX.XX
  ─────────────────────────────────────────
  Total expenses                             $XX,XXX.XX

NET PROFIT (Line 31)                         $XX,XXX.XX

Step 3: Generate quarterly breakdown

Essential for estimated tax payments (see estimated-taxes skill):

Step 4: Flag items needing special treatment

These categories require attention beyond basic categorization:

Meals — Record at full value; only 50% is deductible on the return. See meals-deduction skill for documentation requirements and the 2026 on-premises change.

Home office — Two methods with very different deductions. See home-office skill for the calculation.

Vehicle — Standard mileage vs. actual, method lock-in. See vehicle-expenses skill.

Depreciation — Assets >$2,500 need Section 179, bonus, or MACRS treatment. See depreciation-assets skill.

1099 contractors — Anyone paid ≥$600 (≥$2,000 starting 2026) needs a 1099-NEC by Jan 31. See contractor-1099 skill for the full filing process.

Self-employment tax — Net profit × 92.35% × 15.3%. Social Security caps at $168,600 (2024). Half is deductible on Form 1040 Line 15. See estimated-taxes skill for the calculation.

Startup costs (first year only) — Up to $5,000 deductible immediately (reduced dollar-for-dollar above $50,000 total). Remainder amortized over 180 months. Organizational costs have a separate $5,000 deduction.

Net operating loss — If Schedule C shows a loss, it offsets other income. Post-TCJA: NOLs offset up to 80% of taxable income, unlimited carryforward.

Step 5: Compile documentation

For each category, prepare supporting evidence:

Email receipts — Email-derived extracts provide strong audit documentation: the original sender, timestamp, and content establish authenticity independently.

Bank statements — Reconciled statements proving book entries match actual bank activity.

Mileage log — Date, destination, purpose, miles for every business trip.

Meal log — Date, place, amount, purpose, attendees, relationship for every business meal.

Asset register — Description, date acquired, cost, business-use %, method, accumulated depreciation.

Contractor records — W-9s, payment history, 1099s filed.

Step 6: Deliver the tax package

The final deliverable:

1. P&L — full year + quarterly, mapped to Schedule C lines
2. Expense detail — transaction list by category with receipt references
3. 1099 contractor summary — names, TINs, totals, filing status
4. Depreciation schedule — all assets with current and accumulated depreciation
5. Home office calculation — method, square footage, expenses, deduction
6. Vehicle log — method, miles or actual expenses, business-use %, deduction
7. Meals log — each meal with all five required documentation elements
8. Bank reconciliation — all accounts reconciled through year-end
9. Prior-year carryforwards — NOLs, depreciation, Section 179 carryover
10. Estimated tax payment history — dates and amounts paid

Export as spreadsheet (preferred by accountants), PDF (archive), or accounting software import format.

Related skills

• schedule-c-categories — Which expense goes on which Schedule C line
• expense-categorization — How to assign categories to transactions
• meals-deduction — 50% rule, documentation, entertainment at 0%
• home-office — Simplified vs. actual, Form 8829
• vehicle-expenses — Standard mileage vs. actual, method lock-in
• depreciation-assets — Section 179, bonus depreciation, MACRS
• contractor-1099 — W-9 collection, 1099-NEC filing, penalties
• estimated-taxes — Quarterly payment calculation and safe harbors

Agent metadata

skill: tax-prep
version: 3.0
input: categorized and reconciled financial records
output: tax-ready reports (P&L, expense summary, 1099 summary, depreciation schedule, flagged items)
dependencies:
  - receipt-processing (required)
  - expense-categorization (required)
  - bank-reconciliation (recommended)
next_steps:
  - Hand off to accountant or tax professional
  - Import into tax software