Tax Preparer: Choose a Certified Public Accountant, Enrolled Agent, or Tax Attorney

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When you sign your 1040 form, you agree to abide by the tax law that holds you responsible for paying your taxes, no matter who prepared your return. When it comes to mistakes, the Internal Revenue Service looks for the taxpayer, not the person who filled out the forms. So before you sign your tax life away, make sure the preparer you choose is right for you and will do the right thing when it comes to your taxes and keeping you out of hot water with the IRS.

Match the Qualifications to Your Needs

"The easiest way to protect yourself is to find a reputable preparer who is accredited," says Cindy Hockenberry, an enrolled agent and spokeswoman for the National Association of Tax Professionals. She suggests using a certified public accountant, an enrolled agent or a tax attorney. CPAs, enrolled agents or tax attorneys are required to take continuing education courses to maintain their designation, Hockenberry says. This is a bonus for taxpayers because they have the additional security of knowing their preparer is up to date on the latest tax laws.

In addition tax prepares are required to be licensed in California and Oregon, and also have to take continuing education and pass tests to demonstrate their competence. Unfortunately in most states manicurists are subject to more oversight than tax preparers.

In general, the more complicated your return the more qualified your preparer should be. The simplest returns (Forms 1040EZ) are designed to be easily completed by an average citizen and don't generally require professional preparation. Those with fairly routine filings (1040, Schedules A and B) may be able to do it themselves with the help of tax preparation software. However, if your return is complicated or anything with numbers on it makes you break out in hives there are legions of professionals ready to help.

Find a Tax Preparer: Do a Little Digging

Once you locate a preparer whose credentials wow you, Hockenberry says, dig deeper into his or her background. Find out how long the preparer has been in the tax preparation business, and what services are provided. Also check to see whether the preparer belongs to any professional organizations, an indicator of "dedication to their chosen profession," Hockenberry said.

References are easiest to check when you use a preparer recommended by family or friends. If you select someone who doesn't come by reference, don't be afraid to ask for references and follow up with them to see whether they are satisfied with the service provided by the preparer.

Check the Tax Preparer's Fees First

Hockenberry also recommends checking the preparer's fee before any work is done. This eliminates surprises when you pick up your return, she says, and will also give you an idea whether the preparer overcharges in comparison to other preparers in your area. Since tax issues can pop up anytime, Hockenberry recommends finding a preparer who will be around with regular office hours after the April deadline. Nothing is more frustrating for a taxpayer than not being able to reach a preparer during the year.

Most large tax preparation firms have Web sites detailing franchise locations and hours. If you decide to use an independent preparer, you can search the National Association of Tax Professionals' member database by ZIP code to find a preparer near you.

Source:

• National Association of Tax Professionals