Hire a Tax Preparer: Preparing and Filing a Business Tax Return

Need professional help with your Tax return? If you find yourself getting overwhelmed by preparing and filing your own tax returns, you may want to consider hiring a tax preparer. Here's how to find the correct person for the job. Hiring a tax preparer for your business is the safe way to go. If you are confused by your taxes or have a lot of questions it's probably a decent plan to go ahead and find a professional on your side.

A tax preparer is a professional that is qualified to calculate, file and sign income tax returns on behalf of you and your businesses. They will also represent the taxpayer during IRS examinations of tax returns. There are various kinds of job titles these professionals could have, as well as various certifications and educational levels. Over half of taxpayers hire a professional tax preparer when it’s time to file income tax return. Taxpayers trust these professionals with the most personal and sensitive details of their financial life, their wedding, their income, their kids and their social security number.

Why should you hire a Tax preparer?

1. Save your money and time: If your tax preparer finds even one deduction or tax credit you may have missed, it will simply exceed the fee it costs to have a professional prepare your return. The Internal Revenue Service reports that it takes nearly twenty hours to complete the common tax return with deductions. Your time is worth money. How much is it worth to you to get that time back?
2. Tax professionals can answer your questions and resolve issues: It’s very probably you may have questions about your taxes. Calling the IRS means you may be on hold for hours. Tax professionals will answer most of these instantly.
3. You gain a peace of mind: Professional tax preparers keep up with tax code and all those changes each and every year so you don’t have to. Just knowing that a professional is handling your taxes and reduces your stress.
4. No mistakes: In terms of missed deductions or triggering an IRS letter or audit; a tax professional will help you to eliminate errors and guarantee your returns are prepared correctly.
5. You benefit with money saving tax planning: Tax professionals will advise you now and all year round on the best ways to make good tax-saving decisions. A tax professional will investigate your past returns to visualize if any deductions were missed and, if so, amend them for you.
6. Reduces your risk of an audit: if you are audited or the IRS starts asking questions you can’t easily answer, knowledgeable tax preparer is aware of how to deal with the IRS. You may get in trouble if doing it yourself.

How to hire Tax preparer?

Don't wait until the end of the year to hire a tax preparer. You can find and begin working with someone on your business taxes at any time. If you plan to hire a tax professional to prepare your taxes, you do need to gather and organize your records, mortgage and bank statements, charitable contributions, and so forth. Being organized saves your tax preparer time and keeps the fees down.

Here are few steps to evaluate a tax preparer:

1. Check the Tax Preparer's Education and Credentials: Anyone with a preparer tax identification number will handle and file your taxes, but it’s best to find someone who also can handle audits, IRS collections, and appeals. Typically, the additional qualified a preparer is, the higher the fees. The following are differing kinds of tax preparers in order of expense and certain expertise.
   • Tax Attorney
   • Certified Public Accountant
   • Enrolled agents
   • A Volunteer Income Tax Assistance (VITA) volunteer is trained by the IRS to prepare basic return.
   • Only a certified public accountant or an enrolled agent can represent you in each steps but another type of tax professional can represent you before the IRS in those situations.
2. Look for a Well-Established Pro: New preparers will be able to handle only the most basic returns. It’s a decent plan to find a preparer who has had a minimum of seven to ten years of experience. The reason is that the more time a preparer has been working on tax returns, the more likely he is to have dealt with a tax situation almost like yours.
3. Find out about their service fees: If you’ve found someone you feel comfortable sharing the details of your finances with you’ll need to find out how much they charge before you commit. An easy return may cost about $150 to prepare, but if your tax scenario is more complex, you may end up spending several hundred dollars. Knowing how much you’ll have to pay up front can assist you avoid sticker shock later on. Avoid preparers who base their fee on a percentage of your refund or those that claim they can get larger refunds than other preparers. Also, always make sure any refund due is sent to you or deposited into an account in your name. Under no circumstances should all or a part of your refund be directly deposited into a preparer’s bank account.
4. Find out whether you will get audit support: You can be as honest with the IRS as possible and have the most meticulous tax preparer within the world, and sometimes, your return might get flagged for an audit even so. Since that possibility always exists, one thing you should make certain to inquire regarding is whether the tax preparer you hire can offer audit support within the event you need it. As mentioned earlier, not all tax preparers are authorized to represent clients in IRS matters.
5. Provide all records and receipts required to prepare your return: Good preparers can request to visualize your records and receipts and will ask you multiple questions to verify your total income and your qualifications for expenses, deductions and other items. Do not use a preparer who is willing to electronically file your return before you receive your form W-2 using your last paystub, this is against government agency e-file rules.
6. Make sure the preparer signs the form and includes his or her preparer tax number (PTIN): A paid preparer should sign the return and include his or her PTIN as required by law. Although the preparer signs the return, you're responsible for the accuracy of every item on your return. The preparer should also provide you a copy of the return.

Ask these Questions while interview

Here's a list of questions that I recommend you ask a potential tax preparer:

1. Do you have a PTIN (preparer tax identification number)?
2. What is your tax background?
3. Have you prepared a tax return before..?
4. Do you know the requirements of the states and localities where I am required to file?
5. What records and other documentation will you need from me?
6. How do you determine your fees?
7. Can I file electronically?
8. Who will sign my return?
9. When will I receive a copy of my return?
10. How do I find you if I have a question or a problem after tax season is over?
11. What happens if I get audited?

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