Some people can get away with doing it themselves. Other
folks need professional help. Here's how to tell which group you belong to --
plus a few tips for choosing the right preparer.
Because the tax code is so complicated, more than 60% of
Americans have professionals do their tax returns. Tax law has had major changes
in 45 of the past 48 years.
If you have a simple return, you might consider e-filing or using a simple tax program. But remember, you're not hiring a tax pro just to put numbers in boxes. Any monkey can do that.
3 questions to ask yourself
1.
Are you prepared to give your taxes
your time?
2. Are
you prepared to put up cash to hire a preparer?
3. Are
you prepared to deal with the complexity of the federal code?
Here's how to pick a tax preparer:
If you pay someone to prepare your tax return, the IRS urges you to choose that preparer wisely. Taxpayers are legally responsible for what’s on their tax return even if it is prepared by someone else. So, it is important to choose carefully when hiring an individual or firm to prepare your return. Most return preparers are professional, honest and provide excellent service to their clients.
Here are a few points to keep in mind when someone else prepares your return:
- Check the person's qualifications. Ask if the preparer is affiliated with a professional organization that provides its members with continuing education and resources and holds them to a code of ethics. New regulations effective in 2011 require all paid tax return preparers including attorneys, CPAs and enrolled agents to have a Preparer Tax Identification Number.
- Check the preparer's history. Check to see if the preparer has a questionable history with the Better Business Bureau and check for any disciplinary actions and licensure status through the state boards of accountancy for certified public accountants; the state bar associations for attorneys; and the IRS Office of Professional Responsibility for enrolled agents.
- 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.
- 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. Most 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.
- 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.
- Make sure the preparer signs the form and includes their PTIN. A paid preparer must sign the return and include their PTIN as required by law. Although the preparer signs the return, you are responsible for the accuracy of every item on your return. The preparer must also give you a copy of the return.
Before seeking a paid preparer, taxpayers might consider how much information is available directly from the IRS through the IRS Web site. Check out these helpful links:
- e-file for Individual Taxpayers
- Free File
- Free Tax Return Preparation For You by Volunteers
You can report abusive tax preparers and suspected tax fraud to the IRS on Form 3949-A, Information Referral or by sending a letter to:
Internal Revenue Service
Fresno, CA 93888
Download Form 3949-A and fill it out or order by mail at 800-TAX FORM (800-829-3676).
In the end, you are responsible for every item on your tax return. If you don’t know an answer to tax questions, seek the help of a professional tax preparer.
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