How to Find the Best Tax Preparer for You

While a tax accountant doesn’t need to have experience within your industry, it certainly doesn’t hurt! Make sure when you’re hiring a tax accountant that their fees are in line with your budget. Asking for client referrals is tips for finding the right tax accountant a great way to get better insight into what it’s actually like to work with that tax accountant.

Will they review your past tax returns at no charge?

Not every small business wants or needs to hire an accountant to handle their taxes. Writing out your interview questions ahead of time will ensure you get all the information you need to make an informed decision on whether an accountant is the right fit for you and your business. In addition to traditional accountants, consider looking for professionals who have established themselves as thought leaders in the tax and finance world. These organizations often maintain directories of certified tax preparers, Certified Public Accountants (CPAs), and Enrolled Agents who specialize in business and personal tax situations. Ask colleagues, friends, and family members if they have a tax preparer they trust with their tax returns and financial information.

How Much Does a Tax Preparer Cost?

• To make the best use of your preparer’s time—and to keep your bill to a minimum—be sure to gather all the information you need and make a list of your questions before you meet.
• If you’ve worked with a preparer and your return is ready to submit, make sure that the preparer’s PTIN and signature are included and that you receive a copy for your files.
• When you use Taxfyle, you’re guaranteed an affordable, licensed Professional.
• Whether you’re managing your personal finances or overseeing a small business, finding a good accountant means knowing what to look for.
• First and foremost, you want to ensure that the accountant is qualified and experienced in handling your particular tax situation.
• Per Section 6011(e)(3) of the Internal Revenue Code, paid preparers who reasonably expect to file more than 11 returns in the year are required to file electronically.

Before you hire a tax professional to manage your business taxes, it’s crucial to understand what makes a great accountant. The first time a business owner looks for financial advice from a professional, it’s usually related to bookkeeping or taxes. In 2020, the average fee for having an accountant do a non-itemized 1040 federal and state return was $220, according to a survey of tax preparers and accountants from the National Society of Accountants. If you’re having a hard time narrowing down potential tax accountants, experience within your industry should move an accountant further up the list. A tax professional has an in-depth understanding of both personal and business taxes, ensuring that everything from income reporting to tax return filing is handled with precision. Some accountants get completely swamped during tax season and might not have the availability to give your taxes the time and attention they deserve.

Why Businesses Hire CPAs

The Lili Visa® Debit Card is included in all account plans, and remains fee-free with the Lili Basic plan. Final categorization of income and expenses for tax purposes is your responsibility. 7 Lili AI and other reports related to income and expenses provided by Lili can be used to assist with your accounting.

A successful accountant who has worked with other small businesses will be more adept at navigating the complicated concepts that often arise. These professionals also possess a Preparer Tax Identification Number (PTIN), which is required to legally prepare taxes. Business taxes, especially for small businesses, are significantly more complicated than personal taxes.

Avoid preparers who base their fees on a percentage of your refund—it’s a red flag that they may be engaging in unsavory behavior, according to the IRS. Make sure their expertise applies to your situation, because many preparers specialize in specific areas of tax law. It’s a good idea to find a preparer accustomed to working with people who have similar financial profiles to yours. Ask your tax preparer whether their office is open year-round. They’re also qualified to help you with financial planning and can give you tips that could help you reduce your taxes in the future. These preparers are especially good for complex tax planning and tax preparation.

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From crunching numbers to understanding financial planning, they will have experience helping small business owners file taxes and handle their financial situation with ease. So, instead of typing a phrase into Google like “list three things you should look for when hiring a tax professional” we’ve compiled a much better list with input from accountants themselves. If a tax preparer does not offer to e-file, it could be a red flag that they don’t prepare many tax returns (i.e., they have limited experience).

• Storefront preparers such as H&R Block and Liberty Tax often employ an array of tax professionals, primarily enrolled agents, CPAs, and attorneys.
• Hiring a tax preparer significantly reduces the risk of making these mistakes.
• His MBA included individual, partnership, corporate and fiduciary tax, which is more than one needs if she wants to specialize in individual tax, but it’s awfully nice to have someone advise you who has that broad perspective.
• So, instead of typing a phrase into Google like “list three things you should look for when hiring a tax professional” we’ve compiled a much better list with input from accountants themselves.

You should expect a higher bill if you have a lot of K-1s and/or income from more than one state (because each state requires its own return). I believe the only fair way for a tax advisor to charge is by the hour. My tax advisor, Bob Guenley (who has written a number of guest posts for us), told me he only took one tax course in college and learned a lot on the job, but getting his MBA in tax made a whole world of difference.

If something goes wrong with your filing, this level preparer can’t represent you and help you deal with the IRS, unless they prepared and signed the filing before the end of 2015. If you need help preparing your tax return, there are lots of options to choose from. Hopefully these 11 questions will help you select the right advisor when the time comes. It really comes down too whether you need to actually see your accountant to get comfortable with her advice. It is not necessary for your accountant to be local given the ease with which you can send documents via email and Dropbox. You also don’t want to have to pay for time spent with an “account manager” who always has to go to the expert for the answer.

When Should You Hire an Accountant?

Another excellent resource for finding a qualified accountant is professional organizations. Here are a few methods to help you find a reliable and experienced accountant. Now that you understand the key traits to look for in a tax professional, the next step is finding the right one.

Find a few local CPAs

The cost shouldn’t be the only factor you consider when choosing a tax accountant—but it certainly plays a part. Any good tax accountant will be confident in their client’s satisfaction and happy to put you in touch with them. Any tax accountant you speak to is going to try to sell you their services. Once you’ve got a solid list of potential tax professionals, you need to vet them to figure out which are the best fit for you.

Whether it’s answering questions about tax deductions, explaining strategies to minimize your liabilities, or keeping you updated on the status of your tax return, effective communication is key. A good accountant will also have a keen eye for detail, reviewing every tax return carefully to avoid any errors. Business taxes come with many moving parts, and the right accountant needs to be exceptionally organized.

Individual preparers may agree to cover any additional liabilities to the IRS incurred due to the preparer’s error. Not signing a return is against the law and is a red flag that your preparer may be looking to make a profit by promising you a too-big refund and charging fees based on the size of the refund, the IRS says. Make sure the preparer signs their name and PTIN number on your return.

What Are Warning Signs You Picked the Wrong Tax Preparer?

Finding a good accountant to work with can help your business on multiple levels. It’s possible for your tax preparer to also provide consulting services, but for now let’s assume these are separate resources and focus on the basics. A CPA, or Certified Public Accountant, will have your back for everything related to taxes, and take the burden of filing off your shoulders.

Filing taxes for a small business is different from filing for larger corporations. By asking the right questions and reviewing your business’s financial statements, they can develop tailored tax strategies that reflect your specific circumstances. A successful accountant who understands tax laws, the IRS, and state boards is essential for managing the ever-changing world of taxes. Tax preparation, especially for small business owners, can be complex, and finding the right accountant can make all the difference in your financial situation. Hiring a tax professional can be an important step in managing your finances and securing your business’s success.

But if there’s a local tax professional with hundreds of five-star reviews across Yelp, Google and other review sites, they at least warrant an exploratory phone call. By reaching out to local or national organizations, you can find accountants who have a proven track record in the field. These networks help ensure that tax professionals stay updated on the latest industry standards, IRS regulations, and tax strategies.

Pay close attention to the routing and bank account numbers to ensure your refund goes to the right place (i.e., your bank account—not the preparer’s). Also, review the tax return before signing, and never sign a blank or incomplete return. If the IRS suspects that a preparer’s actions are shady, their clients’ returns may be subject to special review.