Individual and business taxpayers: Need someone to help with your personal or business tax return? Choose your tax professional carefully.
If you need assistance with preparing and filing your personal or business tax return, the Internal Revenue Service (IRS) would like to remind you to choose your tax professional carefully.
This is because there are tax return preparers out there who may cause you or your business harm through fraud, identity theft and other scams. You are ultimately responsible for the information that they report on your or your business’ tax return. However, the IRS believes that most tax returns preparers want to provide honest, quality service.
TAX RETURN PREPARERS SOURCING
Your needs will determine which kind of tax professional is best for you. You have several options to source your service provider:
Search engines: the universal tool
You may do a Google search to prepare a preliminary list of service providers. You may review information publicly available on those service providers such as client’s review comments and note, their website, etc. to prepare a short list of tax return preparers. You should then contact the tax professionals on your short list for a validation interview on their ability to serve your needs.
The IRS: reliable and certified tools
If you want to conduct qualitative research, the IRS offers two tools available at IRS.gov:
- The Choosing a Tax Professional page: You may browse the Choosing a Tax Professional page on IRS.gov for information about tax return preparer credentials and qualifications.
- IRS Directory of Federal Tax Return Preparers and Select Qualifications: you may use the IRS Directory of Federal Tax Return Preparers and Select Qualifications to source tax preparers by type of credential or qualification.
CHOOSING THE RIGHT TAX RETURN PREPARER
When choosing a tax preparer from your short list, the IRS recommends that you:
Look for a tax professional who is available year-round.
You will have someone who is familiar with your situation to reach out to if you have questions after the tax filing season is over.
Review the tax professional’s history.
For that purpose, you may for instance:
- Check the Better Business Bureau website for information about the preparer;
- Look for disciplinary actions and license status if the tax preparer has a credential: CPA, Attorney, IRS Enrolled Agent, etc. You may look for this information in several places:
> For a tax professional who is a CPA, you may check the State Board of Accountancy’s website. For example, for New York, you may visit https://www.op.nysed.gov/.
> For a tax professional who is a licensed Attorney, you may check the State Bar Association.
> For a tax professional who is an IRS Enrolled Agent: search for “verify enrolled agent status” on IRS.gov or check the IRS Directory of Federal Tax Return Preparers
PRACTICAL INFORMATION ON YOUR TAX PREPARER
Credentials and qualifications
- Attorneys, CPAs and enrolled agents: they can represent you before the IRS in all situations.
- Annual Filing Season Program participant: if your prospective service provider is an Annual Filing Season Program participant, he or she may represent you in limited situations if they prepared and signed the tax return.
Ask about service fees
The IRS suggests:
- You avoid tax return preparers who base their fees on a percentage of the refund or who offer to deposit all or part of your tax refund into their own financial accounts.
- You be wary of tax professionals who claim they can get larger refunds than other tax return preparers.
Ensure that the preparer offers IRS e-file.
If they prepare your tax return for e-file, there will be limited errors on it, and it will be processed faster. In addition, your refund will be processed faster if you choose direct deposit in addition to e-filing your tax return.
REPORT A MISCONDUCT
You may report tax return preparer’s misconduct to the IRS using the following methods:
- Form 14157-A, Tax Return Preparer Fraud or Misconduct Affidavit: use this form if you suspect your tax preparer filed or changed your tax return without your consent.
- Form 14157, Return Preparer Complaint: use this form for any other complaints.
Individuals and businesses file hundreds of millions of tax returns with the IRS every year. Even if the number of self-prepared tax returns is growing, most taxpayers still use the service of a professional to prepare their tax return.