The right tax preparer can be the difference between a dream and a nightmare. With the Tax deadline approaching on April 18th, you still have time to research for the tax preparer that is just right for you.
This post provided by Money-Rates.com.
Before you think about how qualified your tax preparer is, think about what’s riding on your tax return.
On the upside, good tax advice can save you hundreds, or possibly thousands, of dollars in tax liability. On the downside, tax evasion is punishable by up to five years in prison and a $250,000 fine, and you are responsible for your tax return, regardless of who prepares it.
As you can see, the qualifications of your tax preparer can matter a great deal. Hardly any states license tax preparers, so it most likely it will be up to you to determine whether your tax preparer is properly qualified. Here are six things you should know before hiring a professional tax preparer:
- What are the preparer’s professional qualifications? According to the Bureau of Labor Statistics, most tax preparers don’t even have a bachelor’s degree. However, only a CPA, Enrolled Agent (a federally-authorized tax practitioner), or attorney can represent you in front of the IRS in an audit or other proceedings, so looking for a higher level of professional qualification might be worthwhile.
- Is this a full-time occupation? Tax work is somewhat seasonal, but changes to the tax code and case law can happen throughout the year. Also, your questions or inquiries from the IRS can occur at any time, so you might be better off with a full-time tax specialist.
- What type of firm is it? Good tax preparers can be found in anything from sole practitioners to multi-national accounting firms. There are trade-offs to each one. With a major accounting firm you get a widely-known reputation and deep resources, but you’ll probably pay more for a big-name firm. A smaller firm may be more personal and less expensive, but have less resources to put into the preparation of your return and backing you up if the IRS calls.