Get (Good) Help With Your Taxes
Preparing a tax return isn’t a simple matter for many of us. Taxpreparation software can be a great help, guiding us through the process and minimizing errors. You might do even better by using a tax professional’s services, though. The U.S. tax code is massive and complicated and changes frequently. A good tax pro will know its ins and outs and may be able to save you a lot of money. Choose a pro carefully, though, and consider hiring an Enrolled Agent, who can represent you before the IRS if need be. (You can find one at naea.org.) Then interview your candidates, who should offer free initial consultations. Ask questions such as these: • How many clients do you have? (How important will my business be to the company?) • What are your fees and billing policies? (Ask for an estimate.) • Who exactly will be preparing my taxes — you, or someone else? • What are your continuing professional education requirements, and how many hours do you normally take each year? (Someone exceeding the requirements is a good sign.) • What research materials do you use and subscribe to? (Answers such as “CCH,” “Research Institute of America” and “BNA” are encouraging. If the answer is merely the current Federal Tax Handbook, that’s a red flag, as some people have complicated tax issues that require deep research.) • If my return is audited, will you represent me before the IRS? (They should go instead of you, not with you. Ideally, you don’t want the tax pro to outsource audits or to insist that you also be present at an audit.) • When will you be able to complete the work? Be sure to choose a pro you’re comfortable with, too. A pro might be very skilled, but if you aren’t comfortable with them, you might undercommunicate with them and might not provide all the information they need to do a good job for you. Learn more at fool.com/taxes.