Things to Remember When Choosing a Tax Preparer | Business
Taxpayers should choose their tax return preparer wisely – with good reason. Taxpayers are responsible for all the information on their income tax return. That’s true no matter who prepares the return. Here are ten tax tips to keep in mind:
1. Check the Preparer’s Qualifications. Use the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications. This tool helps taxpayers find a tax return preparer with the qualifications that they prefer. The Directory is a searchable and sortable listing of preparers with a credentials or filing season qualifications. It includes the name, city, state and zip code of:
- Certified Public Accountants.
- Enrolled Agents.
- Enrolled Retirement Plan Agents.
- Enrolled Actuaries.
- Annual Filing Season Program participants.
Attorneys, CPAs and enrolled agents can represent any client before the IRS in any situation. Annual Filing Season Program participants may represent clients in more limited situations. Non-credentialed preparers who do not participate in the Annual Filing Season Program may only represent clients before the IRS on returns they prepared and signed on or before December 31, 2015.
For more information, check the Understanding Tax Return Preparer Credentials and Qualifications page.
2. Check the Preparer’s History. Ask the Better Business Bureau about the preparer. Check for disciplinary actions and the license status for credentialed preparers. For CPAs, check with the State Board of Accountancy. For attorneys, check with the State Bar Association. For Enrolled Agents, go to IRS.gov and search for “verify enrolled agent status” or check the Directory.
3. Ask about Service Fees. Avoid preparers who base fees on a percentage of the refund or who boast bigger refunds than their competition. When inquiring about a preparer’s services and fees, don’t give them tax documents, Social Security numbers and other information. Some preparers have improperly used this information to file returns without the taxpayer’s permission.
4. Ask to E-file. Taxpayers should make sure their preparer offers IRS e-file. Paid preparers who do taxes for more than 10 clients generally must file electronically. The IRS has safely processed billions of e-filed tax returns.
5. Make Sure the Preparer is Available. Taxpayers may want to contact their preparer after this year’s April 18 due date. Avoid fly-by-night preparers.
6. Provide Records and Receipts. Good preparers will ask to see a taxpayer’s records and receipts. They’ll ask questions to figure the total income, tax deductions, credits, etc. Taxpayers should not use a preparer who will e-file their return using their last pay stub instead of a Form W-2. This is against IRS e-file rules.
7. Never Sign a Blank Return. Don’t use a tax preparer who asks a taxpayer to sign a blank tax form.
8. Review Before Signing. Before signing a tax return, review it. Ask questions if something is not clear. Taxpayers should feel comfortable with the accuracy of their return before they sign it. They should also make sure that their refund goes directly to them – not to the preparer’s bank account. Review the routing and bank account number on the completed return.
9. Ensure the Preparer Signs and Includes Their PTIN. All paid tax preparers must have a Preparer Tax Identification Number (PTIN). By law, paid preparers must sign returns and include their PTIN.
10. Report Abusive Tax Preparers to the IRS. Most tax return preparers are honest and provide great service to their clients. However, some preparers are dishonest. Report abusive tax preparers and suspected tax fraud to the IRS. Use Form 14157, Complaint: Tax Return Preparer. If a taxpayer suspects a tax preparer filed or changed their return without the taxpayer’s consent, they should file Form 14157-A, Return Preparer Fraud or Misconduct Affidavit. Taxpayers can get these forms on IRS.gov any time.
Taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.
This information is not intended to be a substitute for specific, individualized tax advice as individual situations will vary. Royal Alliance Associates, Inc., Georgetown Capital and its advisors are not engaged in rendering tax advice.
These links are provided as a convenience and for informational purposes only. We assume no liability for any inaccuracies, errors or omissions in or from any data or other information provided on the pages, or for any actions taken in reliance on any such data or information.
Prepared by the IRS. For more information go to www.irs.gov.
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Representatives offer Securities and Advisory Services through Royal Alliance Associates, Inc., member FINRA/SIPC and a registered investment advisor.
Insurance services offered through Georgetown Capital Group, which is independent of Royal Alliance Associates, Inc. with separate ownership, and is not registered as a broker-dealer or investment advisor.
Joseph V. Curatolo, President of Georgetown Capital Group
5350 Main Street, Williamsville, NY 14221
Phone #(716) 633-9800 Toll Free 1 (800) 648-8091 Fax #(716) 633-9789