For tax preparers lets start with credentials. In California the credentials to look for are Enrolled Agents (E.A.’s) and Certified Public Accountants (CPA’s). Consider an enrolled agent if you desire more expertise than an walk-in chain such as, H&R Block or Jackson Hewitt, but don’t need a full-service CPA.
Enrolled agents are licensed by the federal government and have demonstrated proficiency by taking a two day intensive examination, and are required to complete 72 hours of continuing education each enrollment term. See end of article for link on “What is an Enrolled Agent.”
Ask about your candidates approach to deductions. Are you comfortable with how aggressive (or how conservative) he or she is?
Clarify your preparer’s experience with dealing with federal (IRS) and state (FTB) government agencies on their clients’ behalf. Not every tax preparer is allowed to represent clients in audits. If you have more than a simple return, you should seek out a preparer who has the appropriate experience. Also, with the experience of dealing with the IRS, the licensed preparer has additional insight into what the agencies are apt to allow and not allow along with knowing how the agency functions.
Get written assurances that the preparer will pay penalties if he or she miscalculates your return, causing you to underpay.
Make sure you can talk to the preparer. Some may be like some doctors who shovel you in and out. You have questions and issues, and the preparer needs to know what your situation is and answer your concerns to your full and complete satisfaction.
You may want a preparer that is available year round for questions. Things happen all year long, not just between January and April 15th. Make sure you have easy access. You may want to buy or sell a home, refinance, start a business, buy or sell a business, buy or sell investments, need business consulting and many more possibilities.
You want experience, knowledge, someone you call get a hold of when you need help, and someone you can relate to and cares about you, and someone you can trust with your confidential information.
Interview your candidate, ask the tough questions, this could be a long-term relationship.
If you would like to interview me my cell phone number is (805) 264-3305,
Checklist Summary of Some Key Questions to Ask:
How long have you been in practice? You want someone who has been preparing returns long enough (i.e. several years) to anticipate problems or IRS challenges.
What are your credentials? Anyone can hang out a sign claiming to be a tax preparer because there are no licensing requirements. So look for an enrolled agent, accredited tax adviser (ATA), accredited tax preparer (ATP), certified public accountant (CPA). Check your state’s licensing board and professional associations to assure that he or she is licensed, is a member in good standing and has had no disciplinary action taken against him or her.
Do you have any specialties? This is important to ask if you have a specific need. For example, if you have a small business, you need someone who knows business accounting. Or if you have rental property, look for someone who has experience handling this sort of tax situation.
How much will you charge? Eisenberg says you probably won’t get an exact number, but a tax preparer should be able to provide you with an estimate. Find out if he or she charges an hourly rate or flat fee and whether that fee will cover everything or will there be add-ons for planning meetings and calls throughout the year.
Do you have room for a new client? Or, more importantly, will you file my return in a timely manner? And will you have time to meet with me throughout the year?
Will you handle my return, or will you hand it off to a less-experienced associate? If the preparer is part of a firm and will not be preparing your return personally, ask if he or she will review it after the associate completes it.
Will you represent me before the IRS? “Run out the door if the answer is no,” Eisenberg says. If you are audited, you want someone who will defend your return.
CLICK HERE to find out more about federally licensed Enrolled Agents (EA).
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