How to Find a Good CPA for Your Taxes
Ask about their specialization
CPAs can specialize in a range of accounting areas, including business, government and forensic accounting, as well as tax preparation. For preparing and filing your personal taxes, consider finding a CPA who specializes in individual income tax returns.
Verify their identification number
The IRS requires CPAs who prepare taxes to register with the IRS and have a Preparer Tax Identification Number (PTIN). To verify that a CPA is registered with a PTIN, simply search the IRS Return Preparer Office Directory.
Look up their license
CPAs are also licensed by the state, so before hiring one, you can search their records with your state’s board of accountancy. Most states offer CPA databases that allow you to search by name and find important information on a CPA’s license status, issue and expiration dates, as well as disciplinary actions and suspensions
Consider their experience
While all CPAs are credentialed prior to offering their services, CPAs with several years of experience will more likely have a deeper understanding of the tax code than a newly certified individual. For example, TurboTax Live CPAs have an average of 15 years of experience
Confirm their willingness to sign
Verify that your CPA will sign your tax return and represent you before the IRS for any tax matter related to your return. If not, consider finding a CPA who will.
How To Find The Perfect Tax Preparer This Tax Season
I don’t prepare my own taxes. That wasn’t always the case. When we first started the law firm, I did taxes for the business and our family. And when we bought our rental property, I took that on, too. And then we had a kid. And another kid. And a third. At some point, juggling it all was too much, and I realized that it was a better use of my time to pay someone else to do our books and prepare our taxes. But finding that person? That was the challenge.
I wasn’t alone in my search for a tax preparer: According to the Internal Revenue Service (IRS), for the year 2013 – that’s pre-Tax Cuts and Jobs Act (TCJA) – about 57% of taxpayers used a professional tax preparer (downloads as a pdf). And according to those same statistics, even as the Tax Code gets more complicated, the number of paid tax preparers is decreasing. With those odds, finding the right fit can take time and patience.
Our initial tax preparer was fine, but there were some gaps in communication. One of those gaps – while I was on maternity leave – resulted in an eventual audit. Our next tax preparer came highly recommended but ended up pleading to a count of felony tax fraud (I’m not kidding). My point: You might not get it right at first, and that’s okay.
Over the years, I’ve sorted out what works. We’ve had a relationship with our current tax preparer for a bit, and he gets me – from my control freak tendencies to my geeky tax humor. But I don’t regret my prior goofs because I learned from those mistakes. And here’s the secret: You’re the only one who can find the perfect tax preparer for you.
That said, I can offer a few tips. The key, as with hiring any professional, is to ask questions. Ideally, you’d establish a relationship – remember, you’re trusting this person with your personal and financial details. But whether you are looking for a long-term tax professional or just someone you meet with once a year to prepare your form 1040, there are some common truths
How Do I Find a Good Tax Professional?
After thinking about whether I should prepare my own taxes or not, I’ve decided to let a professional do the work for me. But now I have another question: How do I find one? No one I know uses an accountant. Should I just walk into one of those tax chains, look for a CPA nearby, or what do I need to consider before giving this person my financial information?
Different Kinds of Tax Professionals
Before you start your search, you might be wondering about all the different kinds of tax pros out there or who can do your taxes. Basically, anyone can call himself a tax preparer and file your return for you. There are two types of tax professionals, though, that are probably most appropriate for you and most people: certified public accountants and enrolled agents. Both types can represent you before the IRS in case you get audited.
Certified public accountants
CPAs are accountants who have passed qualifying state exams and met specific education and experience requirements for that title. Not all CPAs are experts on income taxes, though, so when looking for someone to prepare your return, you’ll want to ask about the CPA’s experience in handling individual taxes. A benefit of going with a CPA is these financial pros may be able to help you with other financial situations like estate planning or financial planning in addition to doing your taxes.
EA is a tax professional licensed by the IRS through a special enrollment exam or after working for the IRS for five years. EAs may specialize in specific tax areas, so be sure to ask what his or her area of expertise is. The benefit of using an enrolled agent is that these people live and breathe taxes (they’re required to take continuing education courses in taxes every three years), and, generally speaking, may charge less than CPAs
You have two other main choices for tax preparers—tax attorneys and tax preparation chains—but I don’t believe they make sense here. Tax attorneys are best for handling complex tax disputes and corporate matters, rather than preparing individual returns.
Finding a Good Tax Preparer
A good number of companies depend on professional tax preparers to file their tax returns. Many decision-makers in organizations prefer to outsource tax filing services to save on cost and time. A big challenge, however, lies in finding a dependable third-party company that can be entrusted with filing tax returns. There are a lot of factors to be considered before settling on a particular service provider.
They should have a CPA, law license or Enrolled Agent designation
When looking for a tax preparer, it is advisable to get someone who is a certified public accountant and has completed the IRS Annual Filing Season program.
Enquire for Preparer Tax Identification Number (PTIN)
Anyone who participates in preparing or assisting in tax preparation is required to have a PTIN by IRS. Therefore, before you settle on a provider for tax preparation, ensure they have a PTIN. They should also put it on your tax return as required by the IRS.
Cost is important in nearly everything, isn’t it? It is important to consider the fee charged by your preferred tax preparer. A common way to determine the authenticity of the charged amount is to do a background search across several providers. Also, many tax preparers charge their fees on an hourly basis. Therefore, if you find one charge based on the size of your refund or claiming they can get you a bigger refund, you should treat these as red alerts.
Look for memberships
If you need to get a reliable tax preparer, you should consider the one registered with a professional organization. The National Association of Tax Professionals, the American Institute of Certified Public Accountants, or the National Association of Enrolled Agents are some of the reputable organizations for tax preparers. Members in these organizations are well-equipped with the latest trends and changes in tax returns. They are also known for high levels of professionalism and adherence to work ethics.
How to Find a Good Tax Accountant
FOR SOME TAXPAYERS, it’s a familiar tale. Somewhere during those first four months of every year, you do your taxes in a haphazard fashion, or you look for someone to prepare your taxes, and because you’ve waited until the last minute, you find someone in a hurry to do them. Every April, as you pay your preparer and Uncle Sam, you vow: Next year, I’m finding a good tax accountant.
How to look when selecting a tax accountant. Beyond trying to find someone who is competent, someone who you feel comfortable working with is a good start. And you’ll feel comfortable by asking a lot questions, says Abby Eisenkraft, CEO of Choice Tax Solutions in New York City. If you’re working in the U.S. but you aren’t an American citizen, you’ll want to inquire if they have experience working with expats, Eisenkraft says. Same goes with if you’re self-employed or have any unusual or special circumstances.
Where to look. That can be tough at first, if you want something beyond a tax preparation chain – and there’s nothing wrong with going with one, but obviously, you can find one pretty quickly in a phone book (yes, those still exist) or in a search engine. If you’re looking for something particular, you may want to try
What to look for when you work with a tax accountant. Unfortunately, kind of like taking a car for a test drive, you really won’t know if your tax accountant is a good fit until you’re working with him or her