Choose a Tax Preparer Wisely

Tax preparers see a lot of personal information. If you pay for someone to do your taxes, know that most preparers are honest and trustworthy.

Each year, however, the IRS sees taxpayers who suffer financially because they make a poor choice in choosing a tax preparer.

Here are red flags that should give you pause about working with certain tax preparers:

1) They refuse to sign your tax return or use a preparer identification number.

2) They promise you a bigger tax refund before even looking at your records.

3) They want you to sign a blank or unfinished tax return.

4) They offer to deposit your refund into their bank account.

5) They refuse to use IRS e-file.

You should also know tax preparers’ qualifications, such as whether they have a professional credential or whether they take continuing education courses. If they are a CPA, enrolled agent, or attorney, they have met substantial proficiency requirements which include passing the uniform CPA exam, the special enrollment exam, or a bar exam, and taking continuing education courses annually.

Certain other preparers may not have a professional credential but voluntarily participate in the IRS annual filing season program.

The IRS has a new directory of federal tax return preparers with credentials and select qualifications on

As you make your decision about a return preparer, keep in mind that only attorneys, CPAs, and enrolled agents have unlimited representation rights before the IRS in all matters, including audits, collection, and appeals. Other preparers have limited representation rights: they can only represent you if they prepared your return, and even then, only in limited cases.

Remember, no matter who prepares your return, you are ultimately responsible for all the information on your tax return.

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About cozbycpa

Heather L. Cozby is a CPA on the South Shore and Cape Cod. The managing partner of Cozby & Company, LLC, Heather has the resources and experience necessary to provide quality professional services on a timely basis and at a reasonable cost. She specializes in tax planning & preparation; audit, review & compilation services; management advisory services; bookkeeping; and accounting. Her unique niche is in working with homeowners’ associations and condominium trusts, advising with rental real estate, and providing outsourced financial consulting for mid-sized companies. She is more entrepreneurial than most accountants, and offers the best of both worlds - providing the services of a larger firm while retaining the ability to connect with her clients on a personal level.
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