In accordance with Accounting Web, 80 million People in America pay a tax preparer every year.
A full 80% of individuals who used tax preparers never questioned about the preparer’s credentials, based on the survey, and almost 75% never inquired if the preparer would stand for them in a tax audit. That’s insane, considering that choosing a tax preparer means giving details about almost everything from your earnings, your bank accounts, your marital life, your children, and your Social Security number.
If you’re worried about giving sensitive information to a person in a largely unregulated field, you’re not the only one. Below are some tips to make it easier to find a good tax preparer and cut down the risk of highly-priced errors and exposing your financial situation.
Try to find Free Tax Preparation Services
Before you even think of paying anyone for tax preparation services, see if you’re qualified for it for free. There are actually two IRS-provided free tax preparation programs:
- Volunteer Income Tax Assistance or VITA
- Tax Counseling for the Elderly
These programs offer eligible persons free tax preparation guidance from skilled volunteers. The VITA program is offered to these groups:
- People with incomes of $53,000 or less
- Individuals with disabilities
- Elderly people
- Those with minimal English-speaking ability
The TCE program is geared towards those age 60 and older, even though people of any age can be able to get assistance from program volunteers. You can find VITA and TCE sites in your area by going to the IRS website.
Meet with Several Preparers
Let’s think you’re not qualified for free tax prep assistance and you’ve determined not to go the DIY option. It could be you’ve a complicated tax situation, or you’re just more relaxed with a human touch. You start discovering the best professional by not stopping at the first preparer you find. Tax preparers have diverse backgrounds, individualities and education. Aim to discuss with at least three preparers before deciding on the one who looks right for you.
Find Negative Reviews and Disciplinary Action
In addition to your interviews, go online to check out potential preparers at the same time. In certain cases, a simple search of the preparer’s name could be enough to bring up reviews. For others, you may need to dig a little deeper. Websites to use are the following:
- Google Reviews
- Tax Buzz
- Yelp (YELP)
- Better Business Bureau
- PTINdirectory (not affiliated with the IRS)
Moreover, if a preparer has a professional certificate or credential, consult your state licensing board to find out if they have been susceptible to any disciplinary action. For preparers who are registered agents, you can also consult with the IRS to check their status.
What amount of money do tax preparers charge? The standard fee for preparing a tax return, was $273 in 2014, based on the National Society of Accountants. The common price to arrange a Form 1040 and state return with no itemized deductions was $159.
Genuine tax preparers usually charge on an hourly basis, therefore, if you find one whose fee is according to the size of your refund or who states he or she can get you a more impressive refund than the next guy, those are warning signs.
If the IRS is auditing you, tax preparers ask for an average of $144 per hour to deal with it, in accordance with the National Society of Accountants.
Find out about E-Filing
Despite the fact that there is no problem with filing via snail mail, try to find someone who will file electronically. Doing this will substantially reduce the amount of time you’ve waiting for your refund to reach you. It can also eliminate the possibility of delivery problems or ill-informed paperwork. The IRS calls for paid tax preparers who file more than 10 returns on behalf of clients every year to e-file their forms.
For more information, check out the Tax Professionals Survey.