Things to Consider Before Hiring a Tax Professional

During tax season every year taxpayers look for prudent and qualified tax preparers to get their taxes prepared. There are many tax preparers out there and choosing the qualified and prudent preparer can be challenging. We have compiled 11 criteria based on internal revenue service (IRS) tips, which will narrow down the right preparer for your next time:

 Preparer’s Qualifications 

Most taxpayers aren't aware they are able to look up their preparer's qualifications on the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications. This is a great tool that lets the taxpayers verify tax return preparers specific qualifications for any tax preparer located within the United States by simply entering the zip code and the last name.

Verify Background

Taxpayers can start by looking at tax preparers online reviews and/ or Better Business Bureau (BBB). Most tax preparers note on their website if they are a member of the BBB. If so, the taxpayer can check the tax preparer's ratings, disciplinary actions against them, and the license status for credentialed preparers. 

Licensing

 This is a very critical criterion. Taxpayers should ensure their tax preparer has at least one of these licenses. This ensures they are held to the highest standards.  The following licenses can be verified. First, for CPAs, the State Board of Accountancy. Second, for attorneys, the State Bar Association. Third, for Enrolled Agents the verify enrolled agent status page on IRS.gov or the directory as stated above in the preparer’s qualification section.  

Fees

The internal revenue service (IRS) does not allow tax preparer to charge contingent fees, which essentially basing the fees on a percentage of the refund rather than a flat fee. The IRS takes this very seriously. Any tax preparer who disregards this rule will be fined or disbarred from filing tax returns by the IRS.

E-File 

In this day and age it is crucial tax preparers are offering e-filing to taxpayers. This ensures their return is filed quickly and the refund is typically processed and deposited much faster by selecting the direct deposit option as compared to paper filing the return. In some cases, the IRS and some states might penalize the taxpayer for not e-filing the return. This adds an additional burden on them to process the returns manually. 

Available Year Around

 The taxpayer should if the tax preparer will be around after the tax season is over? If not, taxpayers should avoid those tax preparers. Tax preparers who will welcome you year-round will usually provide support in case the IRS sends a notice or if a copy of their return is needed, they can assist. Stay away from seasonal tax preparers who disappear after April 15.  

 Records and Receipts

 There are always questions on income, expenses, and deductions. Prudent tax preparers will always ask the taxpayers to support their position by requesting to see a receipts or statements to keep a copy for support. This is followed up by asking specific questions to make sure all the income and deductions have been captured.

Signing a Tax Return

 Taxpayers might run into a situation where they might not be around until after April 15 (Individuals). In that or any other case never sign a blank return for your tax preparer. This is just like handing someone a signed blank check. Avoid tax preparers who ask this from you. The two options here are signing the tax return electronically or filing an extension until October 15.

Review

Just like with any other legal document always review and ask questions on your tax return, if unclear. Filing an accurate return is not only the responsibility of tax preparers but also taxpayers. After reviewing and before signing verify the refund amount and direct deposit information. The tax preparer cannot negotiate or deposit a refund check on your behalf. If the taxpayer doesn’t have a bank account, then a paper check can be requested. This will usually take longer to process by the IRS. After reviewing the information including the banking information on the return asks the tax preparer for a signed copy of the completed tax return for your records, if not already provided.

Signature and PTIN: 

A prudent paid tax preparer should be singing and noting their Preparer Tax Identification Number (PTIN) on the tax return. The PTIN serves as tax preparers Social Security number on the return. It is specific to each tax preparer.

Report Tax Preparers:

 Every year the Office of Professional Responsibility (OPR) barres CPA, Tax Attorney's and/or EA's from practicing for misconduct, fraud, and/or being abusive. Although, the majority of tax preparers are honest and respect the profession. However, if the taxpayer encounters once who they believe was dishonest or abusive they can certainly file a complaint with the IRS by using Form 14157, Complaint: Or if a taxpayer suspects a tax preparer amended or changed their return without their consent, they should file Form 14157-A, Return Preparer Fraud or Misconduct Affidavit. 

All the criteria listed above are equally important in choosing the right tax preparer. Now you can distinguish a good tax preparer from a bad one next time you chose one. If you are planning for taxation, Edison Tax Group is the right choice, they are providing excellent tax service in Edison NJ.