Tax Preparers — The Key To Your Sanity

There’s a reason why sales of Rogaine increase as the 15th of April draws closer. Fortunately, there are people out there that do it for a living.

Uh, So Okay, These are My Receipts…

Fear not if you can’t help but regurgitate upon thinking of preparing your own taxes. Preparing your taxes is a job that can be shipped out to others. Available any time of the year, tax preparers, as they are called, make a living by doing that type of dirty work. So without further ado, let’s say hello to the different types of tax preparers while you say hello again to your sanity.

Basic preparers are the least trained, but the cheapest to hire. In most cases, these are average Joes and Janes such as yourself, working independently to make some money on the side, and their formal taxation and finance education would be…you guessed it right, nonexistent. For the most basic of tax needs, such as W2 wages, and for those who rent rather than own, basic preparers would be a safe and inexpensive choice.

Compared to tax preparers, enrolled agents are more skilled, albeit slightly. These individuals are licensed by the IRS and must take continuing education courses to maintain their license. But with all that in mind, they do not have any formal education in taxation or finance. While enrolled agents have a slightly greater competency than the typical preparer, they are a far cry from a CPA’s level of competence. If your tax situation entails little more than a 1040 filing with no more than two schedules, then go find an enrolled agent who can easily handle such a task for you. If you are looking for more sophisticated tax planning to cut your tax bill, a CPA is probably your best choice.

A CPA [Certified Public Accountant] is a highly trained and licensed individual. The board examinations required for a CPA license are no trifling matter. Once a person becomes a CPA, they also are required to pursue up to 40 hours of continuing education. The downside of using a CPA, of course, is the higher competency translates to higher costs. Be that as it may, you will always get what you pay for, so if you are in a good financial position, then it is highly recommended that you have a CPA work on your tax records.

If tax preparation were the NBA, tax attorneys would be Kobe, Dirk and the rest of the East and West All-Stars. With their state-of-the-art tax plans, tax attorneys can save you a great deal of money…if you can afford them. You would also want to see a tax attorney if the taxman decides to play cat-and-mouse with an ordinary Joe like yourself. While you can count on a CPA to figure out the minutiae of the tax concerns the IRS would raise, their knowledge of evidentiary laws would be as good as Forrest Gump’s knowledge of nuclear physics. So if you want to pull a fast one on the IRS, albeit legally, then it’s time to find yourself a tax attorney.

So, who should you use to prepare your taxes? It really depends on what you are looking for and your finances. Generally, the more complex your finances, the more competency you should look for. If you have the funds, then a CPA would be right for you. CPAs are worth their weight in gold if you can find a good one.

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