BBB offers advice on picking the right tax preparer

ID-100264980By now, you should’ve gotten your W-2 form and at least started thinking about how and when to file your income taxes with the IRS. You may be planning to hire a tax preparer or you may want to use tax software.

Better Business Bureau encourages taxpayers to use caution when selecting tax preparation help to avoid penalties or fees.

Tax preparation professionals offer a variety of services in addition to completing your return. They are generally more familiar with tax saving strategies, can help you organize and plan for next year’s taxes and help you determine if you are required to pay taxes each quarter. Make sure you choose a preparer who offers the services you need.

If you are planning to work with a professional tax preparer, BBB offers a few tips:

  • Get references and do your research. Get referrals from friends and family on who they use and check out the company at BBB.org to see its BBB rating and BBB Accreditation status.
  • Look for credentials. It’s recommended to seek a tax pro who is an Enrolled Agent, Certified Public Accountant or a Tax Attorney. These preparers have completed extensive examinations on tax matters and must stay current by meeting continuing professional education requirements. Only CPAs and tax attorney’s can represent you in Tax Court if you are audited.
  • Get a firm estimate in writing. The cost of preparing your return will vary depending on the complexity and completeness of your information. Before you agree to move forward, present all of your information and get a firm estimate in writing.
  • Don’t fall for the promise of big refunds. Be wary of any tax preparation service promising larger refunds than the competition, and avoid tax preparers who base their fee on a percentage of the refund.
  • Think about accessibility. Many tax preparation services only set up shop for the months leading up to April 17. In case the IRS finds errors, or in case of an audit, you might need to be able to contact your tax preparer throughout the year; be sure to find out how you would do so.
  • Avoid Refund Anticipation Loans. Tax preparers often offer refund anticipation loans to allow you to immediately receive your tax refund; however, this is not an actual refund from the IRS but a short-term loan from the company typically with a high interest rate. To avoid RALs, consider filing your taxes electronically and requesting to have your money direct deposited.

What you’ll need to bring:

  • All your tax documents
  • Photo identification
  • Social Security Cards for yourself and your dependents
  • Checkbook for direct deposit of your refund
  • Copy of last year’s tax return
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