What to Know Before Selecting a Tax Preparer

Phoenix, AZ—The Arizona Department of Revenue recommends that taxpayers practice due diligence when selecting a tax preparer this tax season. Whether you prepare your own return or hire a professional tax preparer, you, the taxpayer, are ultimately responsible for what is filed.

According to the IRS, over 50 percent of filers used tax preparation services in 2021. While the majority are professional and qualified, there are cases of tax preparers who have submitted fraudulent returns or promised larger tax refunds by making improper changes to the tax return.

What should I know before hiring a tax preparer?

  • Ask what kind of formal training the preparer has and how current it is.
  • Ask how long the preparer has been doing tax returns.
  • Check their reviews and history to gather information on their performance and business practices. For CPAs, check with the State Board of Accountancy. For attorneys, check with the State Bar Association.
  • Inquire about costs and service fees. Avoid preparers who base fees on a percentage of their client’s refund and be cautious of preparers that boast about delivering bigger refunds.
  • Select a tax preparer that is available year-round. If you have questions about the return, you can contact the tax preparer after tax season.
  • Ask the preparer to explain how the return was prepared in the event of an examination by ADOR or the IRS.
  • Direct any refund to your bank account, not the preparer’s bank account.

 

Taxpayer responsibilities:

  • Ensure the tax preparer provides you with a copy of the entire return, including copies of all schedules, especially itemized deductions or credits.
  • Confirm you understand your return and ask to explain any deductions, credits, and wages claimed.
  • Ask the preparer to sign the return and list their preparer tax identification number (PTIN).
  • Review the tax return before signing and submitting to ensure numbers are correct, and schedules add up to the tax preparer's source documents.
  • Request that the preparer electronically file your return for a quicker, more accurate return. Paid preparers who do taxes for more than 10 clients must file electronically.

 

For more information on hiring a tax preparer, visit: https://azdor.gov/e-services/selecting-tax-preparer.

 

 

Wednesday, February 22, 2023

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