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Wisconsin — Tax season is fast approaching.
The deadline for submitting income tax forms is April 18, 2023.
Finding a tax accountant to help you with these forms is a good idea. But who can you trust? And how do you know where to start?
The Better Business Bureau has some tips for finding someone you can trust with your finances and personal information.
Know what type of tax accountant is right for you.
There are several different types of tax preparers, but only some can represent clients to the IRS for audits, collection matters, or appeals. Includes accountants, and lawyers.
registered agent
EA is authorized by the IRS to represent taxpayers. They usually have prior qualified employment with the IRS or have taken his two-day exam and background check on federal taxes. A certain number of credit hours must be earned each year to maintain status as an EA.
These preparers are a good option for those with complex taxes. However, make sure they have expertise that can be applied to your unique situation.
CPA
CPAs are more skilled in accounting and are better suited when revenue is highly complex. Most have a university degree or equivalent work experience. If you pass the national qualification exam, you will get your license.
However, make sure you have tax experience and ongoing work, and be aware of any changes in the law. These creators charge more than basic creators.
lawyer
If you need professional advice on things like municipal bonds or estate planning, we recommend hiring a tax accountant. It is also good if you want to legally protect some of your income. Note that they usually charge the highest fees as well.
unqualified
A final option is to work with unqualified taxpayers. About 700,000 people work in these roles part-time or only during the tax season. These creators not only obtain an active creator tax identification number through the IRS, but are regulated solely by the state. Most states allow most people to prepare a return for another person without having to take an exam, obtain a license, or comply with government regulations.
Learn more about state requirements here.
While each type of tax preparer is different, the BBB says one of the most important things you can do before hiring a tax preparer is to interview them. Most are legal and competent, but there may be exceptions as there are no national licensing requirements.
So how can I choose the right one?
Apart from the general tips below, the BBB also recommends that you consider what qualifications your tax accountant must meet personally.
Check your credentials
As noted above, very few authors are able to represent their clients before the IRS. This includes EAs, CPA’s and tax accountants. Others can help you with forms and other issues, but they cannot represent you.
Be careful with big promises
BBB said it could be a serious red flag when creators promise larger refunds than their competitors. Many preppers base their fees on your return, so they may use shady tactics to prepare your return.
According to the BBB, you should also avoid those that offer “anticipated repayment loans.” This can cost you the majority of your return on commission.
collect referrals
According to BBB, asking your loved ones for recommendations is one of the best ways to find a trusted prepper. You can also match against BBB consumer reviews and complaints.
Factors of Availability
It is also important to know how long you can stay in touch with your tax accountant. If the IRS finds errors in your form or conducts an audit, you should be prepared to respond.
Confirm the price in advance
Read all agreements carefully and understand your tax attorney’s fees before agreeing to anything. The BBB also recommends contacting state, federal and local governments for additional charges such as e-filing and unforeseen complications.
Find someone else when things don’t go your way
Do not do business with people who cannot verify their credentials, have bad reviews, or have unconvincing business practices. BBB said it’s important to remember that if you hire them, they have access to your personal information. This is because we need to protect against “corrupt” or fraudulent tax filers.
Here are some other tax-related resources provided by BBB:
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