How to Identify the Best Tax Preparation Service
Filing taxes can be a challenge. Sometimes, it’s better to hire a professional to prepare and file your taxes. According to the IRA, more than 60% of taxpayers use tax preparation services. If you decide to hire a professional service to help with your returns, you have to exercise caution. Choosing a tax preparation service is no small task, considering it means sharing your details, including your income, bank account details, social security number, and family details.
The first step when choosing a tax preparation service is identifying the type of service you need. You want a service with the right expertise and experience for handling your specific needs. As the Tax Code gets more complicated, the number of tax preparation service providers is decreasing. Finding the best one requires time and patience.
Here are some pointers on how to identify the best tax preparation service:
- Check the credentials.
If you pay for a tax preparation service, the preparer must be IRS-registered and have a valid Preparer Tax Identification Number (PTIN). The PTIN is issued annually by IRS to eligible preparers, and can be verified by checking the IRS online PTIN directory. Your tax return should feature the preparer’s PTIN and signature when filed by a tax preparation service.
You should look for a professional who can handle IRS collections, audits, and appeals for complicated returns. An enrolled agent or Certified Public Accountant is your best bet. You can search for such professionals through the National Association of Enrolled Agents.
- Look for experience.
Look for a well-established tax preparation service with at least seven to ten years of experience? For basic returns, you can consider less experienced preparers. An experienced professional is more likely to have dealt with a situation similar to yours.
- Look for knowledge.
Don’t be fooled by credentials and experience. Find out if the tax preparer is knowledgeable about your state’s tax requirements and locality, and if his/her knowledge is up to date.
- Use a service with clients like you.
To get the best possible service, you want a preparer with clients with needs similar to yours. Not all returns are the same, and tax laws are subject to interpretation. A preparer dealing with similar clients with the same circumstances will take time to explore grey areas. This may save you money in the form of deductions or help you avoid crossing red lines and inviting IRS audits.
- Consider the price.
Highly credentialed preparers typically charge more. Tax attorneys, for instance, charge more than CPAs and enrolled agents. Their different price tags mean they can handle returns of varying complexities. Tax preparation services generally quote the price after evaluating the help you require or forms that need completion. Present forms from the previous year to get a price quote. Avoid services that charge their fee based on a percentage of your refund.
Final Thoughts
You’re the only one who can find the best tax preparation service for you. As with hiring any professional, you might not get it right the first time. Research your prospective hires thoroughly and ask questions. It helps to establish a relationship since you’ll have to trust the preparer with sensitive personal and financial information. This link will forward you to the best tax preparation service you can ever find.
