Tips for Choosing a Tax Preparer
Understanding the federal tax code can be a chore. For plenty of Americans, it’s easier to hire a professional tax preparer to avoid potential complications. Then again, choosing one can be a chore in itself. There may be several out there who can perform this role, they are not all the same.
If you’ve never worked with a tax advisor before, finding a person you can trust completely may require a bit of homework on your part. Below are tips to help you in your search:The following are pointers that can guide you as your search:Here are tips to get you started:
Before anything else, check if the tax preparer you’re considering has a Preparer Tax Identification Number or PTIN. Also, you should learn about know the different types of tax preparers, along with the educational background and certification you should expect from them. For example, registered tax return professionals should pass an IRS exam as well as complete 15 hours of continuing coursework year after year. They will be able to represent you in an audit but not in any other situation.
On the other hand, an enrolled agent can be your representative in type of tax issue. Enrolled agents also need to pass an IRS exam and complete a minimum of 72 hours of continuing coursework every three years. A CPA or tax attorney will be affected by unique certification standards depending on your state’s law. Lastly, you might want to check whether or not the tax preparer is part of any professional associations or organizations. If anything, membership is a sign that they are dedicated to their profession.
The IRS advises contacting the Better Business Bureau to know if your prospective tax preparer has any complaints to their name. As well, check if they have been subject to any type of disciplinary action in the past, and if their license is valid. The same type of information can be requested from your state accountancy board and state bar association if you’re working with an accountant or a lawyer. If your plan is to hire an enrolled agent, you should check with the IRS. Of course, there’s word of mouth. Talk to relatives, friends or colleagues who have hired a particular tax preparer to learn more about the quality of service they provide.
Even after finding a tax preparer with whom you are very comfortable sharing your financial details with, refrain from making commitments until you’re sure about their charges. The IRS advises taxpayers to avoid tax preparers who set their fees as a percentage of your refund.
Finally, as most taxpayers know, tax prep providers begin to pop up everywhere as soon as tax season gets underway. While some are working for stable companies, others vanish as tax season ends, creating a potential problem when you have questions to ask or have to make necessary changes later on. Hiring a tax preparer who is always available may cost you a bit more, but it’s good for your peace of mind.