Types of Professionals Who Prepare Tax Returns
Tax return preparation could be time-consuming, complex, and simply frustrating. When there is other work to be done, taxes seem to never get erased from of the to-do list. Still, those taxes getting filed is a necessity, and the safest method of doing it is hiring a tax professional. Remember, even small mistakes can be costly and troublesome, working with an expert however helps you prevent them.
The question is, which expert will it be? There are various types of professionals out there who are can help you with your taxes. The following is a quick list of designations most common today:
Certified Financial Planner (CFP)
A CFP has to meet specific education requirements, pass an exam, acquire experience in finance, and satisfy other particular qualifications. There are CFPs who know a lot regarding filing taxes but not all of them do. If you are looking at someone with this designation, research more about their experience as a tax preparer prior to hiring them.
Certified Public Accountant (CPA)
As indicated by the designation itself, a certified public accountant is a person who has state certification to act as a public accountant In accounting, this is the sole licensed qualification. Depending on certain state requirements, most people need to meet certain educational requirements besides passing a number of exams. Covered under CPA services are financial planning, business evaluation, auditing, and of course, accounting. Some CPAs specialize purely in taxes.
Enrolled Agents (EA)
An enrolled agent is someone who has passed a three-part IRS exam or worked as a former IRS employee. EAs are required to complete ongoing education courses to remain updated on tax law changes, and must follow strict ethical standards. This is the highest IRS-awarded credential a tax preparer can have.
JD (Law Degree) and LLM (Master of Law)
Any person with these degrees may have a taxation specialty, but this is not true in all cases. If you must work with any legal professional, make sure they focus their pratice on taxes and not a whole range of areas. The attorney who helped you with your divorce or personal injury case is most likely not the best choice for your taxes!
A VITA volunteer is a tax preparer who has been trained by the IRS to handle basic returns. If you are a business owner, however, this individual may not the best person for you to approach.
Lastly, if you check further, that there are bookkeepers, accountants and unlicensed tax preparers who have no formal credentials, yet are completely reliable. This does not mean they should not be considered. You probably just have to dig more into their tax experience and education.