Sunday, January 26, 2014

How to choose your tax professional

If you are planning to file your income taxes this year but aren't sure how to choose your tax preparer, we have some tips for you.

It may be tough to choose between a major franchise that guarantees quick filing with large returns, a private tax professional, or a popular online do-it-yourself program.

If you want to use a company, make sure you do your homework first. Find out how much they will charge and if there are any hidden fees.

You should choose someone who is knowledgeable.

"CPA firms, personal accountants, they're always a good choice. A CPA firm they have certified public accountants, which means they've gone through years of accounting schools and they have to do continuing education every year. A big myth is that they're more expensive when they're really not," says Rice.

If you decide to use an online-based program you should know how to do your taxes yourself. Most programs guide you through the process buy you are still on your own. However, there are many free filing options online and in person.

Be wary of places that promise large refunds. Every situation is unique and there is no way to guarantee a large refund.

Avoid places that are only open during tax season. The preparer should be available all year long just in case the IRS gets involved.

Also avoid places that offer quick refunds or say they can file before Jan. 31. No one can file before then, and an electronically-filed tax return with a direct deposit takes seven to ten days to return.

"When you go to look for your tax preparer, it's always good to look for reviews. You can check the Better Business Bureau, you can use paid sites such as Angie's List. There are free review sites everywhere. They're even on Facebook now," says Rice.

The IRS recommends you always check a preparer's qualifications. All tax return preparers should have a preparer tax identification number. Check their history and make sure they haven't had any trouble with the state board. Also ask about their service fees and find out how much they charge.