This tax season, you may want to do what millions of people do and hire a tax preparer to help you file your income tax return. To choose the best professional to help you with your specific tax needs, there are several criteria that you should consider. When making this important decision, be sure to take the following factors into account:
To ensure that you receive the proper assistance, never enlist a non-accountant friend to help. You need a qualified tax professional to help you avoid any costly mistakes on your return. The professional that you choose should have a Preparer Tax Identification Number. This is the federal requirement for professional tax return preparers.
Additionally, it can be helpful to find out whether or not the preparer receives continuing education and is a member of a professional tax preparer organization. These are signs that the preparer is up to date on every aspect of this year’s rules and is knowledgeable of the latest ways to file, since being a Registered Tax Return Preparer requires 15 hours of additional training each year. Checking a preparer’s status with the Better Business Bureau is also helpful for finding complaints from past clients.
The cost of preparing a tax return is a major issue for many tax preparers. Some people choose national tax preparation firms with the belief that doing so will be less expensive than hiring an independent preparer. However, this isn’t always the case. It pays to shop around to find someone who charges reasonable rates while also having the professional experience needed to prepare your return. Independent preparers often charge less for their services than accounting firms.
Depending on the complexity of your financial situation, you may need to find a preparer who charges a flat fee rather than an hourly rate. If you anticipate a very simple return, an hourly rate may be a better financial fit.
Regardless of the manner in which a preparer charges for tax services, the rate should never be related to your tax return. This is an illegal practice that can spur the preparer to file a return with too many deductions simply to boost the refund amount. You must also be sure that any refund is sent to you rather than to your preparer.
While the vast majority of filers don’t need an attorney to prepare their taxes, certain legal complications may make this necessary. If your return will be complicated by foreign trusts, if you faced serious problems with your past returns or if you expect to owe a large amount of taxes, you may need to hire a tax attorney to prepare this year’s tax return for you.
When looking for a preparer, it is also important to find one who you interact well with. If you want to keep the same preparer, it is essential for him or her to be responsive to your needs and for the two of you to be comfortable with each other. You will have to divulge a wealth of financial information to your preparer, and if you are uncomfortable with your tax professional, this may be difficult.
The preparer should also be accessible to you when you need to speak to him or her to ensure there are no last-minute surprises that may make your return late.
This post was published on January 26, 2012