Now that the holidays have come and gone, your mail box will soon start to fill with reminders that tax season is here. For those of you that are new to the Sioux Falls area or for those considering making a change, choosing a new tax professional can be a scary process. You will need to share the most personal information including details about your relationships, income and children in order to complete the filing process properly.
Thankfully, IRS has released its opinion about what to look for in a tax professional. Looking for professional with credentials is at the top of the list. IRS suggests looking for preparers that are CPA’s, Attorneys, or Enrolled Agents.
“Most people are familiar with the CPA and attorney designations, but the Enrolled Agent is often overlooked”, Timothy Ness of Ness Tax and Bookkeeping Servicestated. “An Enrolled Agent is governed by the Internal Revenue Service and must pass a 3 part test administered by the IRS. Unlike the CPA exam or the Bar exam, all parts are either tax or ethics related and all continuing education must be focused on tax law as well.”
Ness also suggests you ask your tax professional if he/she can e-file tax returns.
“IRS governs who can e-file”, Ness said. “If your preparer cannot e-file, ask why. Many states now require electronic filing but IRS can deny that privilege to individuals who may have done something improper.”
Tax professionals who prepare and electronically file a significant number of returns must also have a Preparer Tax Identification Number (PTIN). This number takes the place of the preparer’s SSN and helps the IRS identify preparers. Preparers who do not sign off on the tax returns they prepare and who do not possess a PTIN may not be true tax professionals. Ness said you should be concerned if you do not see this information on your return copy but instead see the words “self-prepared”. You may want to take your business elsewhere.
Often we rely on the subjective input of our friends and co-workers but looking at a firm’s history and ties to the community also provides an objective source. Look to firms which have established roots in the community.
“Ness Tax and Bookkeeping Service is a member of the Chamber of Commerce, Home Builders Association, and Better Business Bureau,” Ness said. “We joined these organizations in part to ensure local credibility and some local accountability. They tax profession does have some fly by night organizations and we wanted to reassure the public that we were not one of them.”
Once you’ve chosen a tax professional, never sign blank forms or blank tax returns. If a preparer asks you to sign a blank form, deny and wait until things are finalized before signing.
“Unfortunately, people have put blind trust in tax professionals who have taken advantage of them by manipulating refunds which “accidently” get deposited into the preparer’s account,” Ness said. “After signing the necessary documents, always ask for a copy of your return for your records.”
Remember, no firm or tax professional is perfect but selecting a tax professional wisely can pay dividends in the short term and in years to come.
DISCLAIMER: The views of the author are not necessarily those of this station, its owners, officers, agents or employees.