Who Can Prepare Your Tax Returns?
Frequently Asked Questions
Many taxpayers ask who can prepare tax returns. The answer is that anyone can prepare tax returns. However, not everyone can prepare accurate tax returns. Not every preparer knows what questions to ask and which tax deductions and tax credits to claim. When it comes time to prepare your tax return, you have a few different options. You can prepare the return yourself, either manually, using a tax software package, or using the tax software providers authorized by the Internal Revenue Service (IRS). You could ask a friend who has some experience in tax preparation to prepare your return for you. You may qualify to have your return prepared by a volunteer organization such as AARP, or you can have a paid preparer do your tax return.
Beginning January 1, 2011, a Preparer Tax Identification Number (PTIN) must be obtained by all tax return preparers, as well as enrolled agents who are compensated for preparing, or assisting in the preparation of, all or substantially all of any U.S. federal tax return, claim for refund, or generally most other tax form submitted to the IRS. A paid preparer must have a Preparer Tax Identification Number issued by the IRS for the return to be accepted by the IRS.
Generally, how you decide depends on your own personal preference. Factors to consider are: how complicated your return is, how qualified you feel you are to prepare your own return, who has done your tax return in the past, and whether you have any significant changes this year. If you prefer to use a paid preparer, you also have several options that you should carefully evaluate.
There are a number of different types of paid preparers, who possess different levels of qualifications and capabilities, offering different types of services. Their prices will also vary considerably. Certain individuals have the qualifications necessary to represent taxpayers before the IRS, but many paid tax preparers do not.
The more complicated your tax situation, the more expertise you need to look for. If in addition to having your tax return prepared, you are also looking for tax advice, or tax planning, you will need to find a person qualified to provide that service.
Your primary concern should be to find a tax preparer who knows taxes, is up-to-date on the latest changes in tax laws, and who is knowledgeable and experienced in your particular needs. You should ask about the preparer's overall experience, and about experience in the area that concerns you, whether it involves itemized deductions, job related expenses, capital gains, income and expenses from rental properties, income from self-employment or a small business, or any other area.