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How to Find a Good Tax Return Preparer

If your tax situation is convoluted, you may choose to hire a professional tax preparer. Many people prefer to pay an expert in order to avoid costly IRS penalties, which can include additional taxes and interest.

Be careful as you pick your preparer because you will remain legally responsible for the return, regardless of who prepared it.

Types of Tax Preparers
Services Tips for The Average Joe

Tax Lawyers
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Tax lawyers are the most expensive tax preparers you will find today, and are often hired only for extremely complicated tax situations.

Certified Public Accountants (CPAs)

For information on the training and credentials of CPAs, the website of the American Institute of Certified Public Accountants can help.

Enrolled Agents

To check the training and credentials of Enrolled Agents, visit the National Association of Enrolled Agents website.

National Tax Preparation Companies

Tax preparation service providers have varying specialties and experience, but they are a cost-efficient option for those with simple tax situations.

Red Flags

Avoid tax preparers who:

> Promise to get you bigger refunds than other preparers;

> Want to be paid a percentage of your total refund;

> Have been the subject of complaints filed at such organizations as your state board, and the Better Business Bureau.

Interviewing Prospects

It is very important for your tax preparer to be experienced with tax forms needed for your specific situation. Also, discuss possible costs prior to committing to hire a tax preparer.

These are some of the most important questions you should ask them:

> Up to how much might I might have to pay you?

> Are you going to prepare my tax return yourself, or is it going to be someone else and how do I contact this person?

> How many of the forms relevant to my case do you prepare yearly, and have you mastered any special rules that may apply?

> For example, if you need to file a “dual status” tax return (being a tax resident for only part of the year), ask what number of dual status returns your prospect usually preparer year after year.

After Preparation

After finishing with your return, the tax preparer is legally required to sign the document, fill in the preparer portion of the form, include his identifying number, and give you a copy of the return for reference. Make sure you:

> Check if all the details are correct, both your tax information and your personal information, such as your name, address and the like;

> Understand everything the form says or includes;

> Check the box for third party authorization, in case you would like the preparer to handle any issues the IRS might have concerning your return; and

> Sign the return.

Finally, don’t ever sign an empty return or with a pencil.