4 Questions You Should Ask Your Tax Preparer

It’s usually very complex to file for returns especially if you don’t have the right skills. To be on the safe side you should hire a tax preparer who will handle the complex work on your behalf. For you to hire the right preparer, you need to ask him/her a number of questions. Some of the questions that you should ask include:

What are your credentials?

A tax preparer can be an enrolled agent, an attorney, or a certified public accountant. Regardless of the person that you hire, you should ensure that he/she is registered with the IRS and has a valid PTIN.

When you work with a registered professional you are not only sure that your documents will be handled professionally, but you are also exempted from potential IRS penalties.

What is your tax background?

Different professionals have different tax backgrounds and you should ensure that you know their background so that you can know how they will be of benefit to you. Different backgrounds have different initials that might confuse you. To help you out, here is an explanation of the common initials:

CFP: this stands for certified financial planner. These are people that have been given the designation by the certified financial planner board of standards. For one to qualify for this title, he/she must pass tax and tax planning components.

CPA: this is a certified public accountant who has been certified by the state to act as a public accountant. Some accountants do tax examinations while others don’t; therefore, if you are considering hiring a CPA, you should ask him/her whether he/she tackled tax and tax returns in school.

What type of returns do you prepare?

Different tax professionals specialize in different areas. For example, a preparer may specialize in preparing returns for gamblers, self employed people, and active investors.

Since each field has its own unique deductions, you should ensure that you hire a professional who has experience in the field that you are in. For example, if you are in the oil industry, you should go for a professional who has worked in the oil industry.

How do you determine your fees?

You should know how the preparer determines his/her fees. Different professionals have different ways of determining their fees: some charge a fixed fee while others charge depending on the complexity of the work.

Knowing how the professional determines the fees will help you in knowing the amount of money that you need to pay.

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