Things to consider when choosing a tax return preparer

Things to consider when choosing a tax return preparer

Tax season can be a stressful time for many individuals, and finding the right tax return preparer can make all the difference in ensuring a smooth and accurate filing process.

With countless options available, selecting the right tax professional requires careful consideration. The choice you make can have a significant impact on your financial well-being and peace of mind. In this blog post, we'll explore the essential factors that individuals should keep in mind when selecting a tax return preparer. By the end of this article, you'll be well-equipped with the knowledge to make an informed decision and ensure your tax returns are in capable hands. Here is a list of things you need to consider when selecting your tax preparer:

1. Ensure the preparer signs and includes their PTIN. By law, anyone who is paid to prepare or help prepare federal tax returns must have a valid Preparer Tax Identification Number. Paid preparers must sign and include their PTIN on any tax return they prepare. Not signing a return is a red flag that the paid preparer may be looking to make a quick profit by promising a big refund or charging fees based on the size of the refund. Taxpayers should avoid these unethical tax return preparers.

2. Make sure the preparer is available year-round. If questions come up about a tax return, taxpayers may need to contact the preparer after the filing season is over.

3. Review the preparer's history. Taxpayers can check with the Better Business Bureau for information about the preparer, any disciplinary actions, and the license status for credentialed preparers. Other resources include: the State Board of Accountancy's website for CPAs; the State Bar Association for attorneys; and the IRS Directory of Federal Tax Return Preparers for enrolled agents or verify an enrolled agent’s status online.

4. Ask about service fees. Taxpayers should avoid tax return preparers who base their fees on a percentage of the refund or who offer to deposit all or part of the refund into their own financial accounts. Be wary of tax return preparers who claim they can get larger refunds than their competitors.

5. Ensure their preparer offers IRS e-file. The IRS issues most refunds in fewer than 21 days for taxpayers who file electronically and choose direct deposit.

6. Understand the preparer's credentials and qualifications. Attorneys, CPAs and enrolled agents can represent any client before the IRS in any situation. The IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications can help identify many preparers by type of credential or qualification. Tax return preparers who participate in the Annual Filing Season Program may represent taxpayers in limited situations if they prepared and signed the tax return.
7. Good preparers ask to see records and receipts. They'll also ask questions to determine the client's total income, deductions, tax credits and other items. Taxpayers should avoid a tax return preparer who e-files using pay stubs instead of W-2s. This is against IRS rules.

8. Any refund should go directly to the taxpayer – not into the preparer's bank account. Taxpayers should check the routing and bank account number on the completed return and make sure they’re accurate.

9. Taxpayers are responsible for filing a complete and correct tax return. They should never sign a blank or incomplete return and never hire a tax return preparer who asks them to do so.

Choosing a tax return preparer is a decision that should not be taken lightly. The factors we've discussed in this blog post can serve as your guiding light when making this crucial choice. Your financial health and the accuracy of your tax returns depend on this decision, so it's essential to prioritize due diligence and careful evaluation.

By considering credentials, experience, fees, and ethical standards, you can rest assured that your tax affairs are in capable hands.

As you embark on your search for the ideal tax return preparer, remember that this is an investment in your financial future. Your choice can lead to savings, peace of mind, and a smoother tax-filing process, so make it wisely and secure your financial well-being.