Here’s some food for thought, courtesy of Jen Miller on Interest.com: How Should You Do Your Taxes This Year? Jen asked me a few questions for the piece – it was a fun interview!
The timing is great since tax season is upon us. If you’re looking for a tax pro, you might also be interested in these tips for finding a tax preparer, previously posted on my blog.
If you’re planning on doing your own taxes, you might want some free tax software. I’ll be giving some away on my site next week, so stop on by!
KPE-
While Jen’s article does a good job of pointing out the “cons” of doing your own taxes using tax preparation software and using the services of a “fast food” commercial chain like Henry and Richard (although she is dead wrong when she says they are “cheap”), it is incomplete when it discusses the option of using an independent tax professional.
Why does she limit the choice to CPA? This is a common error among uninformed journalists. They wrongly assume that CPA = tax expert.
What about the Enrolled Agent? EAs must pass a difficult test in federal taxation, and must take mandatory continuing education in federal tax topics. The CPA exam has minimal, if any, questions on 1040s, and CPAs are not required to maintain continuing education in taxes. Just because a person has the initials CPA after his/her name does not mean he/she knows his/her arse from a hole in the ground when it comes to 1040s.
She also leaves out the “unenrolled” preparer, who has been dumped on lately. Hopefully the new IRS regulation of tax preparers will give competent, but currently “unenrolled”, tax professionals the credibility they deserve.
Jen does a great disservice to her readers by limiting her choices to CPAs.
Unfortunately I could not leave a comment to the article. Perhaps you can pass this along to Jen.
Thanks!
TWTP
I agree for the most part with the statement above. EAs are excellent tax preparers in most cases. There fee structure is similar to that of CPAs. There are two types of EAs. The ones that have passed the comprehensive exam that the IRS gives are excellent. The IRS can also award EA status to a former IRS employee with 10 years of service – some of those are also great but not all of them worked with returns when they were with IRS.
In California they’ve registered tax preparers for years and impose continuting education requirements. Other folks also prepare returns who are not registered and I’d stay away from them in California. Once the IRS gets their enrollment squared away you can be sure that those tax preparers are up-to-date on the latest laws.
I also agree with her comments about H&R – in this area the prices they charge are similar to those charged by CPAs.