There is no obligation for an individual to hire a tax professional to prepare and file his or her taxes. However, preparing one’s taxes without a general understanding of taxes can result in reporting inaccurate information and lead to tax penalties. Hence, hiring a tax professional to assure one’s taxes are properly prepared and filed correctly can be extremely beneficial, as well as save money in the long run. There are a plethora of tax professionals with varied specializations, especially in Torrance, California. According to California Legislative Information, any tax professional that prepares taxes in exchange for a fee is required by law to register as a tax preparer with the California Tax Education Council.
It is essential to do one’s due diligence prior to hiring a tax professional. Any professional that prepares one’s taxes must be privy to his or her client’s entire financial situation. For this reason, it is essential to make sure you completely trust and are comfortable with sharing this information with your tax professional. Here are several questions you can ask before committing to a tax professional:
- What are your credentials?
- What is your PTIN?
- Do you e-file taxes?
- How much do your services cost?
The answers to the above questions should help assure you that you are making the right selection. If you come across a tax professional that does not resonate with you and/ or does not feel like a good fit, continue your search. With the vast amount of options available, you are sure to find a tax professional that aligns with and is able to offer services that accommodate your specific needs.
Know Your Options
There are several different types of professionals that are qualified to assist in tax preparations and can be classified as tax professionals. Each type has varied credentials and differing degrees of professional experience. Some of the commonly known types of tax professionals include the following:
- Certified Public Accountants (CPAs): typically the most relied upon choice when it comes to complex tax situations, CPAs are certified at the state level. Some CPAs focus on accounting, while others specialize in tax planning and preparation.
- Enrolled Agents (EAs): EAs are highly qualified tax professionals as they hold the highest credentials awarded by the IRS. The IRS certifies enrolled agents, as EAs must pass an IRS-sponsored exam as well as commit to participate in a certain amount of continuing education courses to maintain their EA status. EAs can handle preparing virtually any level of complexity of tax return as well as provide representation for you before the IRS, should circumstances warrant (i.e. facing an audit, collection demands…etc.).
- California Registered Tax Preparers (CRTPs): According to the California Education Council, all CRTPs must obtain a PTIN (Preparer Tax Identification Number) from the IRS, complete yearly continuing education courses, register with the CTEC and provide a certificate of completion to lawfully prepare and file taxes on behalf of another entity in the state of California.
Understanding your personal needs regarding taxes can help you delineate, which type of tax professional may the best fit in accomplishing your tax and/ or financial needs. Tax professionals have a fiduciary responsibility to their clients to provide services that meet the most up to date requirements set forth by the IRS.
For Further Information
If you follow your instincts and are clear with your needs you will likely find an accountant that is an excellent fit. While the task to connect with tIf you follow your instincts and are clear with your needs you will likely find an accountant that is an excellent fit. While the task to connect with the right accountant may seem overwhelming, please keep in mind it will be worth it in the long run. The financial guidance that a good accountant will provide during one’s lifetime can result in significant financial gain. With the full range of tax and accounting services Allman & Allman APAC provide, we are certainly equipped with the expertise for which you may be in need. Seeking guidance from our firm will proved you the opportunity to work with individuals armed with broad and deep financial knowledge, able to provide advice on a wide range of issues. As a full-service public accounting firm, our professional services will surely help you succeed and thrive. Please feel free to reach out to Allman & Allman APAC at email@example.com or call us at our Palm Desert office at 760-773-1120 or our Torrance office at 424-334-1120. We look forward to hearing from you.
- “California Registered Tax Preparer Requirement.” Support, www.support.taxslayerpro.com/hc/en-us/articles/360009169234-California-Registered-Tax-Preparer-Requirement.
- “California Tax Education Council.” CTEC, www.ctec.org/taxpayers/what-is-crtp.
- “Code Section Group.” Codes Display Text, www.leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=BPC&division=8.&title=&part=&chapter=14.&article.
- Connick, Wendy. “The 5 Types of Tax Preparers: Which One Is Best for You?” The Motley Fool, The Motley Fool, 12 Feb. 2017, www.fool.com/retirement/2017/02/12/the-5-types-of-tax-preparers-which-one-is-best-for.aspx.
- “Choosing a Tax Professional: Internal Revenue Service.” Choosing a Tax Professional | Internal Revenue Service, www.irs.gov/tax-professionals/choosing-a-tax-professional.
- “Directory of Federal Tax Return Preparers with Credentials and Select Qualifications.” RPO Preparer Directory, www.irs.treasury.gov/rpo/rpo.jsf.
- TurboTax. “What Is an Enrolled Agent for Taxes?” TurboTax Tax Tips & Videos, www.turbotax.intuit.com/tax-tips/tax-pro/what-is-an-enrolled-agent-for-taxes/L6WXJ82Dl.
- Orem, Tina. “7 Tips to Find the Best Tax Preparer Near You.” NerdWallet, 14 Feb. 2019, www.nerdwallet.com/blog/taxes/how-to-find-best-tax-preparer-near/.