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Tuesday, March 16, 2010   37º F

03/11/2010 09:05 AM

Money Matters: Picking a tax preparer

By: Tara Lynn Wagner

Choosing a tax preparer can be difficult. Tara Lynn Wagner offers up some tips in the following Money Matters report.

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You've saved your receipts. You've gotten your W2 forms. And now it's time to start doing those taxes.

While many people prefer to let a professional handle the job, picking a preparer can be as confusing as the tax code itself.

“When choosing an accountant to do your taxes, you should choose them with the same care that you use to choose a doctor or a lawyer,” said Internal Revenue Service spokeswoman Dianne Besunder.

Besunder says if you're in the market for a preparer, you should ask around for recommendations, and then ask the potential candidates a lot of questions.

“There are various things you do, like find out what type of credentials they have, how long they've been in business,” suggests Besunder.

Besunder and other experts say you should seek out an established, year-round practice.

“You want to look at their established pattern. Are they there? Will they be there? Have they been there,” said Mark Steber, chief tax officer at Jackson Hewitt Tax Service. “You really should avoid the people who just pop up right during tax season, because when a question comes around, and you have a question or the IRS has a question, they may not be there.”

Experience is one thing, but tax laws are constantly evolving, so it's equally important that preparers participate in ongoing training. While one might question the knowledge of a seasonal employee at, say, a national tax preparation chain, Steber says the staff at his agency goes through rigorous training to stay current.

“We spend hundreds of hours every year training our staff, trying to keep up with the laws, because they're changing and they're complex,” he said. “Lots of preparers say, ‘I've been doing it for 20 years,’ but there are lots of changes every year, late-breaking changes.”

Finally, experts say to be on the lookout for warning signs of fraudulent preparers which generally come in the form of empty promises of hefty refunds.

“If someone promises you a big refund without knowing anything about your situation, that should be something that raises a red flag in your mind, or if their fee is based on how much of a refund that you have,” Besunder advises.

Once you find someone who makes the cut, keep them. Not only will they be familiar with your history, but experts say dealing with a familiar and trusted face year after year could make the experience a little less dreadful.

“Find someone who's convenient, who's trained, up to date, using current technology, and then I think you'll get a very pleasurable experience and, probably, a good return on your investment of the fee and, probably, a bigger refund, frankly,” Steber said.