How to choose a tax preparer?
Deciding to choose a tax preparer can be a tricky and
important decision that you will make. Here are some of the general facts that
you should know about tax preparers before you decide to choose one.
·
A paid tax return preparer with primary
responsibility for overall substantive accuracy of a return is required, by
law, to sign the return and include a preparer tax identification number (PTIN)
on the return.
·
Although the tax return preparer signs the return,
you are ultimately responsible for the accuracy of every item on your return.
·
IRS
does not certify tax preparers. (They do certify enrolled agents.) Anyone can
do tax returns as far as the U.S. government is concerned, although some states
such as California, New York etc. impose a licensing requirement.
·
Shopping
around for a tax preparer by asking them to prepare a tax return and then
deciding to go to them, may not be a good idea. You need to ensure that your
tax preparer is competent enough to prepare your tax return. Once you do that
you would need to rely on their professional experience and expertise.
·
Typically
a tax preparer could be an enrolled agent, a public accountant, a certified
public accountant or a lawyer.
So where
should you look for a tax preparer? Your best bet is to ask your friends,
family, co-workers. Friends in similar financial situations are the best
source. These days you can also check the internet to find a tax preparer in
your neighborhood. Read the reviews that others have written about the quality
of the tax preparer’s service before your decide to engage their services.
The IRS
has outlined some of the points that you might want to keep in mind before you
decide to engage a tax preparer:
·
Check the person's qualifications. New regulations require
all paid tax return preparers to have a Preparer Tax Identification Number
(PTIN). In addition to making sure they have a PTIN, ask if the preparer is
affiliated with a professional organization and attends continuing education
classes.
·
Experience: Most preparers can do a simple 1040, but your family's
trust could throw some preparers for a loop. Check out any special requirements
in advance. While you're at it, make sure that the preparer's experience is
current. The tax laws are changing all the time.
·
Find out about their service fees. Avoid preparers who base
their fee on a percentage of your refund or those who claim they can obtain
larger refunds than other preparers. Also, always make sure any refund due is
sent to you or deposited into an account in your name. Under no circumstances
should all or part of your refund be directly deposited into a preparer’s bank
account.
·
Ask if they offer electronic filing. Any paid preparer who
prepares and files more than 10 returns for clients must file the returns
electronically, unless the client opts to file a paper return. More than 1
billion individual tax returns have been safely and securely processed since
the debut of electronic filing in 1990. Make sure your preparer offers IRS
e-file.
·
Make sure the tax preparer is accessible. Make sure you will be able
to contact the tax preparer after the return has been filed, even after the
April due date, in case questions arise.
·
Provide all records and receipts needed to prepare your return. Reputable preparers will
request to see your records and receipts and will ask you multiple questions to
determine your total income and your qualifications for expenses, deductions
and other items. Do not use a preparer who is willing to electronically file
your return before you receive your Form W-2 using your last pay stub. This is
against IRS e-file rules.
·
Never sign a blank return. Avoid tax preparers that ask you to sign a blank tax
form.
·
Review the entire return before signing it. Before you sign your tax
return, review it and ask questions. Make sure you understand everything and
are comfortable with the accuracy of the return before you sign it.
Finally you should stay away from a
tax preparer who possess any of the following traits:
·
Guarantees you a
refund upfront or charges a fee based on the size of your refund.
·
Arranges to have your
refund sent to an address that's not yours.
·
Doesn't ask too many
questions or doesn’t ask for supporting documents such as W-2 wage statements.
·
Offers to create
documents to support false or exaggerated deductions.
·
Asks you to sign a
blank form.
·
Refuses to give you a
photocopy of your return.
·
Refuses to list their
SSN or PTIN or refuses to sign the return, as required by law.
Compliments of VXL Services, a Business Consulting
Services Company that provides Tax Planning and Tax return preparation to
Individuals across US. Please contact Prakash Iyer CPA
We also provide Accounting, Tax, Payroll, Consulting and
Company Incorporation Services to Start ups, Small and Medium Sized companies
across US. If you have any questions please contact us at (732) 983 – 4150 or
visit us at www.vxlservices.com
for all the various Business Packages that we have to offer.
