Tax season is here, and you may be seeking someone new to prepare your tax return. However, remember that you, the taxpayer, are ultimately responsible for all your income tax return information.
In July 2019, the IRS reminded tax practitioners that all “professional tax preparers” must create a written data security plan to protect clients. It’s federal law. Do not hesitate to ask your preparer or a potential tax pro how they protect your information.
Choose your tax professional carefully and perform your due diligence before hiring a tax preparer.
Here are some tips and questions to consider when selecting a tax preparer.
1. Check the Preparer’s Credentials
- Enrolled Agents: Go to the verify enrolled agent status page on IRS.gov.
- Certified Public Accountants: Check with the State Board of Accountancy.
- Attorneys: Check with the State Bar Association.
2. Ask about the fees. People should avoid preparers who base prices on a percentage of the refund or boast bigger refunds than their competition.
3. Ask if the preparer e-files. The quickest way for taxpayers to get their refund is to file their federal tax return and choose direct deposit electronically.
4. Make sure the preparer is available after April 15th. Avoid “fly-by-night” preparers.
5. Provide records and receipts. Good preparers will ask to see the taxpayer’s mileage logs, documents, and receipts (as needed). And they will ask questions, often many questions.
6. Never sign a blank return. Before signing a tax return, the taxpayer should review it and ask questions if something is unclear. Taxpayers should feel comfortable with the accuracy of their return before they sign it. Once they sign the return, taxpayers accept responsibility for its information.
8. Review details about any refund. Taxpayers should ensure that their refund goes directly to them – not to the preparer’s bank account. Check the banking information on the completed return.
9. Check that the Preparer Signs and Includes their PTIN. All paid tax preparers must have a Preparer Tax Identification Number. In addition, by law, paid preparers must sign returns and include their PTIN.
10. Ask if they offer an Audit Protection Plan.
Filing your taxes is an annual ritual that can affect your finances. Don’t take the competence of tax professionals for granted. Ask questions to protect yourself and your money.