Choose wisely, when you intend to get the bang for your buck. Linda and Priscilla are very diligent about getting their money’s worth and that explains why they screen cautiously when it comes to choosing a tax preparer. If you pay someone to prepare your income tax return, the IRS urges you to choose that person wisely. Here are ten tips to keep in mind when choosing a tax preparer:
All paid tax preparers are required to have a Preparer Tax Identification Number or PTIN. In addition to making sure they have a PTIN, ask the preparer if they attend continuing education classes. You can actually see if a tax preparer is licensed with each State Board of Accountancy or is qualified with the IRS. The IRS has a link to verify tax preparers, Enrolled Agents (EA) at http://irs.treasury.gov/rpo/rpo.jsf
Each state has a Board of Accountancy to verify Certified Public Accountants (CPA) and a state bar to verify Attorneys.
Check to see if the preparer has a questionable history. Watch out for disciplinary actions and for the status of their licenses. For Certified Public Accountants (CPA), check with the state board of accountancy. For Attorneys, check with the state bar association. For Enrolled Agents (EA), check with the IRS Office of Enrollment.
Avoid preparers who base their fee on a percentage of your refund or those who say they can get larger refunds than others can. Always make sure any refund due is sent to you or deposited into your bank account. Taxpayers should not deposit their refund into a preparer’s bank account. Ask what the estimated fees will be before the tax returns are prepared. Your tax professional should be able to give you a good estimate, so the final bill is not a surprise!
Make sure your preparer offers IRS e-file. Any paid preparer who prepares and files more than 10 returns for clients generally must file the returns electronically.
Make sure you’ll be able to contact the tax preparer after you file your return – even after the April 15 due date. This may be helpful in the event questions come up about your tax return.
Good preparers will ask to see your records and receipts. They’ll ask questions to determine your total income, deductions, tax credits and other items. Do not use a preparer who is willing to e-file your return using your last pay stub instead of your Form W-2. This is against IRS e-file rules.
Don’t use a tax preparer that asks you to sign a blank tax form.
Before you sign your tax return, review it and ask questions if something is not clear. Make sure you’re comfortable with the accuracy of the return, before you sign it. Remember, you are still legally responsible for what is on it.
Paid preparers must sign returns and include their PTIN as required by law. The preparer must also give you a copy of the return. If a paid preparer does not sign s return, it is illegal, they can be sanctioned and even lose their licenses, plus face fines, penalties and possibly be enjoined from preparing future tax returns. NEVER use a preparer that doesn’t sign the tax returns they complete!
You can report abusive tax preparers and suspected tax fraud to the IRS. Use Form 14157, Complaint: Tax Return Preparer. If you suspect a return preparer filed or changed the return without your consent, you should also file Form 14157-A, Return Preparer Fraud or Misconduct Affidavit. You can get these forms at IRS.gov or by calling 800-TAX-FORM (800-829-3676).
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