How to Choose a Tax Preparer

The average cost to have your taxes prepared by a professional could cost anywhere between $200 to $320.

If your return is complex, that could be money well spent. Here are some tips to help you find the best tax preparer for your needs.

Network with friends and workmates for a referral

In the same way that you may ask around to find a good contractor to work on your house, you may want to ask your family, friends, and work colleagues for a good tax preparer referral. 

Only ask family, friends, and acquaintances that you trust and get along with. Also, only ask people that you know are good with their money and seem to have fewer financial problems and crises than others.

While there is no guarantee that you will find the right tax preparer for you, it’s a good start.

Determine your exact tax preparation needs

What are your tax concerns?

If you work a salaried job or as a remote telecommuter, then you may just require basic tax return preparation. 

Do you own multiple properties or investments? Do you own or co-own a business? Are you involved in the ownership or management of any internationally located properties or businesses?

In this circumstance, you may require the assistance of a more personalized tax preparer.

If you know you need a basic tax return, then you can visit any commercial tax preparer like H&R Block. But if you have more financially detailed and complex tax obligations, then you may want to visit a CPA with the experience to handle your tax situation.

Verify credentials

There are several ways that you can verify that someone has the credential to prepare your taxes.

You can ask for proof of their CPA or tax attorney credentials to legally practice their services.

I.R.S. Enrolled Agents are tax preparers who are certified by the I.R.S. to practice their skills. They must get their certification renewed every three years. Their names should be listed on the I.R.S. Enrolled Agents site.

This I.R.S. page has a searchable federal database of tax preparers based on their level of skill

However, anyone can prepare taxes for others. All you need is a preparer’s tax identification number or a PTIN.

If you have been referred to an uncredentialed tax preparer with no certifications but who is well vetted and can prove their track record, then they may be suitable for your needs.

Request an interview

As a potential tax preparer if they would agree to a five or 10-minute interview.

All you have to do is ask a few questions to see if they suit your filing needs. Ask questions like:

  • What is your hourly rate or flat fee?
  • Do you keep or sell my data?
  • Do you personally prepare the returns or have a staff that does it?
  • How many returns do your business file annually?
  • Doe your company file electronically or via mail?

Also, take note of the preparer’s mood and tone when answering your questions. Don’t deal with anyone who acts impatient or unprofessional.

How to spot fraudulent tax preparers

Everyone makes mistakes. If you notice your preparer doing any of these things, then they may be a crook:

  • Unwilling to sign the return. Tax preparers must sign, date, or stamp their company brand on a return before you
  • Charge you based on the size of the refund
  • Makes outrageous promises that sound too good to be true
  • Works from an unkempt, temporary office
  • No website or social media presence