How to Hire a Tax Professional for Your Small Business

If you own a business, you should not be doing the tax preparations yourself. Preparing an income tax return can be frustrating and confusing. Luckily, you have the option of choosing a professional to prepare your taxes for you. This will not remove all the frustration and irritation that comes with a tax return, but it will help you to better cope with most of it.

You can choose a Certified Public Accountant (CPA), which is a designation that is familiar to most all of us. There is another choice you can make that is less well known. This choice would be to pick an Enrolled Agent (EA). An Enrolled Agent holds a federal license registered with the Internal Revenue Service and is qualified to represent clients before the Internal Revenue Service. A CPA is licensed by the state and is educated in a much broader aspect of financial services. Just because someone is a CPA, it doesn't mean that they are a tax expert.

Be certain that you hire a person experienced in preparing taxes for your individual niche. Perhaps, you are self-employed, the owner of a small business, or an on the road trucker. All of these categories have varying standards, procedures, and restrictions for filing an income tax return. You will want to be sure that your tax professional has experience relative to your category of taxpayer. Even if you are just filing a seemingly standard income tax return, you do not want to hire someone who just started yesterday. Experience is a key factor in deciding who should prepare your tax return.

Check out the reputation of your tax professional. Do not be afraid to ask for client testimonials or referrals. Reputation is very important. You want to hire someone who acts on your behalf, but not someone willing to stretch credence to the point of triggering a tax audit. It is very good to have someone preparing your taxes that can lower your tax liability, but such results must come legitimately.

Be careful of anyone who promises you too much. Any tax professional that is willing to "guarantee" that they will save you money on your tax return should be avoided. There is absolutely no way anyone can guarantee anything about your income taxes, except the Internal Revenue Service. A guarantee is a pretty sure sign that this person is willing to stretch the rules in preparing your taxes. Such a lack of ethics can probably guarantee you one thing for sure, and that's an Internal Revenue Service audit.

Make sure the person you hire to prepare your income tax return charges fair and competitive rates. Don't hire the first person you come across. Compare fees and charges, along with certification, references, experience, and reputation. Combining these factors when comparing tax professionals should help you greatly in making the right choice regarding who is going to prepare your tax return.