The tax professional community is broad consisting of (1) certified public accountants (CPA), (2) enrolled agents (EA), (3) tax attorneys, (4) national tax-preparation chains, and (5) other general preparers with a preparer tax identification number (PTIN) from the IRS. Those with only a PTIN are typically independent tax prepation shops with no special designation, although certified financial planners (CFP) may have a PTIN so that they are authorized to prepare tax returns. All tax preparer’s signing a tax return must have a PTIN.
National tax-preparation chains are those typically seasonal businesses found in strip malls and other retailers. Tax returns prepared by these franchises will typically cost the least, however, the personnel preparing these returns generally are low-trained seasonal employees making the lowest wage of any tax preparer. The quality of these tax returns is decent when there are only basic tax forms such as W2’s, 1098’s, 1099’s, etc. Fees generally start at around $150 and are mostly based on the number and types of forms prepared.
Tax attorneys are generally used for the most complex tax issues and representation before the IRS. Having graduated from law school and passed a state bar exam, tax attorneys possess a thorough understanding of new, old, and case law, while also having an intimate knowledge of IRS proceedings and court appearances. Most tax attorneys do not regularly prepare tax returns; however, client-attorney privilege exists with tax attorneys, a privilege that does not exists with any other tax preparers. Tax court proceedings, complex international issues, estate planning and other income sheltering are best accomplished through a tax attorney. Fees are typically billed hourly starting at $200 per hour with a total cost easily reaching over $10,000.
Enrolled Agents can be any individual who has passed a comprehensive federally administered IRS exam. Many EA’s work alongside CPA’s in a professional services firm, and like CPAs, has the privilege of representing taxpayers before the IRS. An accounting degree is not required of EA’s; however, many EA’s possess an accounting background, which assists them in preparation of business tax returns. Fees an EA may start at $200 for a basic tax return.
Certified public accountants are professionals with at least a bachelors degree in accounting who have passed the Uniform Certified Public Accountant Examination and possess at least two years of public accounting experience. Extensive experience with financial statement preparation make CPA’s the most logical choice for business tax preparation, while rigorous continueing education standards and having passed the CPA exam ensures a skillset qualified for complex individual tax situations.
National tax-preparation chains are those typically seasonal businesses found in strip malls and other retailers. Tax returns prepared by these franchises will typically cost the least, however, the personnel preparing these returns generally are low-trained seasonal employees making the lowest wage of any tax preparer. The quality of these tax returns is decent when there are only basic tax forms such as W2’s, 1098’s, 1099’s, etc. Fees generally start at around $150 and are mostly based on the number and types of forms prepared.
Tax attorneys are generally used for the most complex tax issues and representation before the IRS. Having graduated from law school and passed a state bar exam, tax attorneys possess a thorough understanding of new, old, and case law, while also having an intimate knowledge of IRS proceedings and court appearances. Most tax attorneys do not regularly prepare tax returns; however, client-attorney privilege exists with tax attorneys, a privilege that does not exists with any other tax preparers. Tax court proceedings, complex international issues, estate planning and other income sheltering are best accomplished through a tax attorney. Fees are typically billed hourly starting at $200 per hour with a total cost easily reaching over $10,000.
Enrolled Agents can be any individual who has passed a comprehensive federally administered IRS exam. Many EA’s work alongside CPA’s in a professional services firm, and like CPAs, has the privilege of representing taxpayers before the IRS. An accounting degree is not required of EA’s; however, many EA’s possess an accounting background, which assists them in preparation of business tax returns. Fees an EA may start at $200 for a basic tax return.
Certified public accountants are professionals with at least a bachelors degree in accounting who have passed the Uniform Certified Public Accountant Examination and possess at least two years of public accounting experience. Extensive experience with financial statement preparation make CPA’s the most logical choice for business tax preparation, while rigorous continueing education standards and having passed the CPA exam ensures a skillset qualified for complex individual tax situations.