Kathy Garlow a ‘Woman to Watch’

Elmhurst native and resident Kathy Garlow was named one of the “2012 Women to Watch” last week by the Illinois CPA Society.

Garlow was recognized for her abilities as an accountant, and for her qualities as a "people person," serving as a mentor to her employees and trusted confidante of her clients, according to her employer, Shepard Schwartz & Harris LLP.

What types of services do you provide for the families and businesses that you serve?
I specialize in income tax and estate and gift tax planning for high net worth individuals and their families. Providing consulting and tax expertise, I advise these families with their personal income tax returns as well as investment partnerships and LLCs, trusts, estates, and private foundations. With a designation as a Certified Specialist in Estate Planning, I consult families on wealth transfers between generations as well as charitable giving. I have expansive experience working on estate tax returns, funding the testamentary trusts and planning for the related income taxes. I try to patiently and thoroughly explain the process with the surviving spouse and/or family.
I also work with clients owning professional service companies.  My clientele includes law firms, medical practices, architects, interior design firms and website design firms.

What is your favorite aspect of wealth management and planning?
I like to help my clients solve their problems. I like that they come to me as their trusted adviser with all different types of issues. With my staff and my networking contacts, I work with a team to provide solutions for my clients. My favorite aspect of my job is getting to know my clients and their families and easing their stress when it comes to financial issues.

What is most challenging?
Meeting the tax deadlines is absolutely the most challenging part of my career.  We need to gather the client's information and quickly turn around an accurate tax return for filing. The various investment account statements and partnership income reporting forms seem to come later each year. And this year, as we wait for Congress to enact a new tax law, it makes tax planning even more challenging. 

What is the No. 1 thing your clients find the most confusing about the tax code?
I try to explain all types of tax provisions to my clients. I find that "Alternative Minimum Tax" is the most confusing concept.  This tax was enacted in 1969 due to some high income taxpayers paying zero tax because their deductions wiped out their income. This was widely perceived as unfair. So Congress enacted the AMT to exclude certain deductions.
In recent years, Congress has allowed a "patch" or an increased exemption against alternative minimum taxable income to limit the amount  of taxpayers resulting in an AMT assessment.  Even with this patch, there were approximately 4 million taxpayers that had this tax in 2011.  Congress has not yet enacted this patch for 2012. If there is no patch for 2012, it is estimated that be approximately 28 million more taxpayers will be affected by this tax.

If you could propose one change to the tax code, what would it be?
I would eliminate the alternative minimum tax.  But I know that our federal government needs the funds and I don't think I'll live to see the day that it is repealed.

As the director of your firm's intern program, what advice do you give to current college students looking to enter the field in the future?
I advise them to take as many accounting and business classes as possible to be prepared for the CPA exam. Take the classes seriously and get good grades. Also they should look for an internship with an accounting firm or volunteer for their school's tax clinic. They should try to gain as much experience as possible to prepare them for a full time job in accounting. They can also get involved with their school's student business organizations to hone in on their networking skills. There is a lot of competition and they need to have experience or knowledge that puts them ahead of the crowd.