Open the current packet and prior return
Start with the current client documents, prior return, payroll, distribution detail, invoices, and fixed-asset records. Keep each fact attached to its file and tax period.
Tax preparation and review
Compare this year with the prior return.
Memwa starts with the current client packet, prior return, payroll, distributions, invoices, and fixed-asset records. It prepares the tax workpaper, missing-document list, and tax questions for professional review.
Current year and prior return
Prior-return amounts sit beside current-year payroll, distributions, invoices, fixed assets, and missing support so the reviewer can see what changed and where each figure came from.
Example client data
Alder Junction: 2025 return beside the Q1 2026 packet.
Memwa compares the 2025 1120-S summary with Q1 2026 payroll, distributions, the workstation invoice, and fixed-asset support. It carries the period and source into the workpaper and identifies the facts that still need support.
2025 1120-S summary
Historical return facts
- Gross receipts
- $1,248,600
- Owner W-2 wages
- $120,000
- Shareholder distributions
- $96,000
- Ordinary business income
- $70,750
Q1 2026 records
Current facts to review
- Q1 owner wages
- $27,000
- Q1 shareholder distributions
- $72,000
- Workstation invoice
- $18,750
- Owner advance without a signed note
- $25,000
What remains open
The comparison identifies open questions about owner duties and time, full-year profitability, fixed-asset details, and documentation for the owner advance. The $132,000 wage figure is a planning benchmark for the reviewer to assess, not a concluded requirement.
Preparation sequence
Build the workpaper from supported facts.
For a supported sole-proprietor file, the result may be a Schedule C review worksheet. For the Alder S corporation example, it is a prior-year comparison, tax workpaper, missing-document list, and set of tax questions.
Compare without collapsing the periods
Put prior-year return facts beside current-year records. Flag changes that need explanation without treating a Q1 pace as a full-year conclusion.
Prepare the current-year workpaper
Carry supported values into the review worksheet. Leave unsupported fields blank, name the missing document, and keep assumptions visible.
Build the missing-document list and tax questions
Turn blank fields, unsupported amounts, and changed facts into a client-readable document list and focused questions for the tax professional.
Tax professional review
Decide the tax treatment and what belongs in the return.
The workpaper shows the source, period, prior-year comparison, assumptions, and missing support behind each question. The tax professional resolves the open facts and chooses the return treatment.