Although there is still time before the next 2015 tax season, choosing a tax preparer now allows more time for taxpayers to consider appropriate options for your tax preparation need. You can also find and speak with possible tax preparers and not during tax season when they are busiest. Lastly, this also allows taxpayers to make a little tax planning for the rest of the year. If a taxpayer would prefer to pay someone to prepare your return, the IRS encourage taxpayers to find someone qualified.
Here some tips that taxpayers can take into account when selecting a tax professional:
- Select a preparer with ethics. Taxpayers trust some of your most important personal information with the person who prepares your tax return, including income, investments and Social Security numbers.
- Ask Questions. Avoid preparers who based their fees on a percentage of the refund or those who say they can get refunds higher than others. Taxpayers should make sure that any refund that is due to them be sent to them or deposited in your bank account, not in a tax preparer bank account.
- Be sure to choose a preparer with an identification number (PTIN). Paid tax preparers must have a current PTIN to prepare a tax return. It is also a good idea to ask the tax preparer if they belong to a professional organization and attends continuing education classes for learn about 2015 tax changes.
- Investigue history of the tax preparer. Check with the Better Business Bureau (BBB) to see if your tax preparer has a questionable record. To check the status of an enrolled agent license, check with the registration office of the IRS (enrolled agents are licensed by the IRS and are trained specifically in the federal tax planning, preparation and representation). For certified public accountants (CPAs), check with the State Board of accountancy; for attorneys, call the State Bar Association.
- Request E – file. Any tax preparer that prepares and files more than 10 tax returns for customers, in general must submit returns electronically to the IRS
- Provide tax records. A good preparer will ask you to show your records and receipts. Avoid the tax preparer who is willing to file a return electronically using the last paystub rather than the form W-2. This goes against the rules of e – file for IRS.
- Make sure that the tax preparer is available throughout the year. This can be useful if you have questions about taxes. Taxpayers can designate your pay or other third party tax preparer to speak with the IRS regarding the preparation of your tax return, problems with the payment and/or refund and mathematical errors. The box of permission of the third party in the form 1040, 1040A, and 1040EZ gives the third designated the authority to receive and inspect statements and declarations information for one year from the original deadline for the tax return (without taking into account the extensions).
- Check the tax return and ask questions before you sign it. Taxpayers are legally responsible for what appears on their tax return, regardless if someone else prepared it. Make sure that it is accurate before you sign it.
- Never sign a blank tax return. If a taxpayer signed a blank 1040, the preparer could put whatever he wants in the tax return – even his own bank account for tax refund number.
- The tax preparer must sign the tax return and include their PTIN as required by law.
To assist taxpayers in determining the credentials and qualifications of a tax preparer, the IRS launched a public directory at the beginning of this year that contains some tax professionals. The directory is a database where you can search and sort with the name, city and postcode of credentialed tax preparers as well as those who have completed the requirements for the new annual program of tax filing from the IRS and have a PTIN
Any professional with a PTIN from the IRS tax is authorized for preparing federal tax returns. However, tax professionals have different levels of skill, education and experience. An important difference in the types of preparers are “rights to representation”. Below is a guide on each credential and qualification:
Rights of representation without limit: enrolled agents, lawyers and public accountants have rights of representation without limits with the IRS. With these credentials tax professionals may represent clients on any matter, including audit, issues of payment and collection, and appeals.
What is an IRS Enrolled Agent?
Enrolled agents (EAs) are authorized by the IRS. Enrolled agents are subject to a verification and must pass a special exam for registration of three parts, this full test forces them to demonstrate his skill in the federal tax planning, preparation and representation of business and individual tax statements. They must complete 72 hours of continuing education every three years.
What is a Certified Public Account (CPA)?
Certified Public Accountants (CPAs) – are authorized by the State boards of accountancy, the District of Columbia and the U.S. territories. Accountants have passed the Uniform CPA examination. They have completed a study of accounting at a college or University and also met the requirements of experience and good behavior set forth by their respective boards of Directors of accounting. In addition, public accountants must comply with ethics requirements and complete continuing education courses to maintain active CPA license. The CPAs can provide a range of services; some public accountants specialize in the tax preparation & planning.
What is a Lawyer?
Lawyers – authorized by State courts, the District of Columbia or its designee, as the status bar. In general, they have obtained a degree in law and passed a test of access to the legal profession. Lawyers usually have continuing education and professional behavior standards. They can also provide a range of services; Some lawyers specialize in tax preparation and planning.
Non-Registered Tax Preparers
Preparers without one of these (also known as non-registered preparers) credentials have limited practice rights. They may only represent clients whose statements they prepared and signed, but only to the agents of taxes, representatives of service to the customer and similar IRS employees, including the taxpayer advocate service. They cannot represent clients whose statements are not prepared, and not representing clients with respect to appeals or payment issues even if they prepared and signed the Declaration in question.
IRS Registration of Tax Preparers
The participants of the annual program of tax filing from the IRS – this new voluntary program recognizes the efforts of preparers of tax returns that are usually not lawyers, registered agents or certified public accountants. The IRS issues a record of compliance with the annual programme of tax filing from the IRS preparers who obtain a certain number of hours of continuing education as they prepare for a given tax year. After the presentation of tax of the 2015 season, non-enrolled tax preparers might choose to participate in this program from the IRS, which was designed to promote the education and prepare for the tax filing season.