How to Find Your (Tax Prep) Soul Mate

Many U.S. taxpayers opt to prepare and file their own return.  With the many challenges of 2020, though, you might be thinking of calling a tax preparer to handle your filing this year.  Here are some things to consider:

 

• Make sure the tax preparer has the fulfilled the requirements to prepare and file federal and state returns. At the minimum, all tax preparers should have an IRS Preparer Tax Identification Number (PTIN) for federal returns.  Each state will also have its own qualifications, which are listed in the state’s revenue department.
• Don’t just hire the first person you find. Schedule a phone call or meeting to get to know the preparer before signing an agreement.  Ask questions about critical things like background and experience, but also see how comfortable you feel about the conversation in general.
• Determine what level of tax preparation service you need. Is your return complicated enough to require a tax attorney?  Do you need someone who can represent you on the returns they prepare for you?  The higher the involvement level, the higher the fees you’ll pay — but also the higher your peace of mind in case you need extra support with your filing.
• Get a fee quote before agreeing to work with a tax preparer. Ask if the fee is fixed or a minimum – sometimes a tax preparer will offer a fee that includes a small amount of bookkeeping time, but you’ll have to pay more if it turns out a significant amount of bookkeeping work needs to get done to calculate the return accurately.
• Be careful of “ghost preparers” who will prepare your return but not sign off as preparer. In addition to this being a violation of IRS rules, it is a warning sign that the preparer isn’t properly competent and may be looking to scam you in other ways.
• Finally, DO NOT sign your tax return until you review everything carefully, including your routing and bank account number for direct deposit refunds. If something in the tax return seems off, ask!  Ultimately, you are responsible for the accuracy of your return, even if you pay someone to prepare it.

 

A good starting place on your search is the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications (https://irs.treasury.gov/rpo/rpo.jsf).  But don’t wait too long – the filing deadline is just five weeks away!