By Cameron Nakashima, BBB Great West + Pacific
We’re in the middle of tax season. As you gather forms from employers, banks and other sources, you’re faced with a crucial decision: should you file your taxes yourself or hire a professional? If you’re filing on your own, will you use the IRS’s free filing software or opt for a commercial tax preparation service with added features? And if you’re considering hiring a professional, how do you know what kind of expert is right for your situation?
No matter the choice, one factor is paramount: trust. Whether you’re using a website or a local business, you need confidence that your tax preparer will not only deliver accurate results but also safeguard your money and personal information. Here’s what you need to know about the types of tax preparation services available, the benefits they offer, and how Better Business Bureau (BBB) can help you find one you can trust.
Not all tax professionals are the same. Understanding the differences between the types of tax professionals can help you choose the right fit for your needs.
Tax Preparers
These individuals hold a valid IRS-issued Preparer Tax Identification Number (PTIN). Their qualifications can vary by state, so verifying their credentials is essential.
Enrolled Agents (EAs)
Authorized by the IRS, these professionals pass rigorous exams or meet experience requirements. They specialize in complex tax situations and financial planning.
Certified Public Accountants (CPAs)
CPAs are licensed accounting experts who excel in detailed tax planning and preparation. They must meet state-specific requirements and continue education to stay updated on tax laws.
Tax Attorneys
These legal specialists handle tax-related legal issues, represent clients in tax court and draft relevant legal documents. They are best for complex tax disputes and high-stakes legal matters.
While most tax professionals are reputable, some red flags can indicate potential scams or unethical practices. Two things to watch out for are unrealistic promises and vague credentials. Avoid tax preparers who guarantee large refunds or base their fees on a percentage of your refund. These are often warning signs of unethical behavior. Be wary of preparers who cannot verify their qualifications or are evasive about their certifications.
Finding the right tax preparer doesn’t have to be overwhelming. The following tips to choose a trustworthy tax professional can ensure you’re making a safe and informed choice.
Do Your Research
Start with BBB.org to find BBB Accredited Businesses that are vetted and trusted. When you find a professional that interests you, check ratings, reviews and complaint histories of tax professionals in your area. It’s also smart to consult referrals from trusted sources and review websites and verify credentials with your state’s licensing board.
Ask Questions
Before committing, have a detailed conversation with the preparer. Ask about their experience, services and security measures for protecting your information. A reputable professional will be transparent.
Trust Your Instincts
If something feels off, it probably is. Don’t hesitate to walk away if a preparer cannot answer your questions or provide verification of their qualifications.
Verify Fees
Understand the fee structure upfront. Avoid services that charge based on your refund amount or have hidden costs.
Check for Year-Round Availability
Choose a professional who will be available to assist with any questions or issues that may arise after tax season.
This tax season, let trust and preparation guide your decisions. Whether you’re filing online or partnering with a local expert, a little due diligence can make all the difference. By choosing the right tax professional, you’ll not only save time and stress but also ensure your finances and personal information are in safe hands.