If you intend to hire a tax advisor to help you with your returns this year, the IRS offers some tips to consider when selecting one. The right one can save you hundreds and even thousands of dollars. Unfortunately, choosing the wrong one or trying your luck with an unknown online software program will not only waste your time and money, it will also result in the need to hire another professional, lost deductions, and valuable tax advice. If yours is simple in nature, you may want to consider skipping the $200 per hour CPA and go with someone who is less in demand. However, if you have a complex return involving multiple lawsuits and those tricky gray areas, hiring a professional is a good idea. But how do you know who is the best person for this job? Here are some tips when buying:
Ratings
Most importantly, the IRS urges taxpayers to strictly use tax advisors who actually sign each return they prepare and enter their Preparer Tax Identification Numbers (PTINs). The new regulations require all paid tax preparers to have a PTIN. Also, you should find out if he has any affiliations with professional organizations and attends continuing education courses. In the near future, the IRS will require preparers who are not CPAs, Enrolled Agents, or Attorneys to take a test to become Registered Tax Return Preparers.
History
It’s always a good idea to check the individual’s history with the Better Business Bureau to make sure no disciplinary action or license revocations have ever occurred. Additionally, you can check with your state bar association for attorneys as well as the IRS Office of Enrollment for enrolled agents.
Service fees
If the person you select bases their fee on a percentage of your refund, you’re probably better off looking for someone else. It should also be understood that you ensure that all your refunds are deposited into your account and in your name.
IRS e-file
More than a billion individual tax returns have been securely processed since the introduction of electronic filing in 1990. Unless you opt for a paper copy, all paid preparers filing for more than 10 clients must do so. electronically.
Request for Records and Receipts
Any trusted professional will request all of the supporting information and ask you numerous questions to correctly determine your deductions. You must also have full accessibility to the person you hire during and even after you have applied should any questions or concerns arise.
Lastly, it should be common knowledge that you should never sign a blank form. And before you sign a full one, make sure you understand the entire form. Please review it, ask questions, and confirm the accuracy of the data before signing the dotted line. One would assume that each year’s filing is very black and white, but a tax accountant proves worthy by knowing the gray areas. Based on experience and education, they know best how to interpret IRS decisions.