There's an accountant shortage in the U.S., so consumers may find it a little trickier to secure a tax preparer.
The Internal Revenue Service reminded taxpayers on Thursday that it's important to carefully choose a tax professional.
"Most tax return preparers provide honest, high-quality service," according to the notice. "But some may cause harm through fraud, identity theft and other scams."
"Another reason to choose a tax preparer carefully is because taxpayers are ultimately legally responsible for all the information on their income tax return, regardless of who prepares it," according to the IRS.
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Why it may be harder to find an accountant
Accounting bachelor's degree completions have been falling about 3% every year since 2015, according to the American Institute of Certified Public Accountants. The number of new candidates sitting in for the certified public accountant exams has also been declining since 2016, the AICPA found.
To address the decline of new professionals in the field and "expand the CPA pipeline," the format of the CPA exam will be different in 2024, Henry Grzes, lead manager for tax practice and ethics with the AICPA, recently told CNBC.
"That's the reason the exam was changed: to allow more people to have that designation. The CPA designation is a very important standard," Grzes said.
Here are five ways to vet a tax preparer, according to the IRS:
1. Make sure they have a PTIN
Always ensure the tax preparer you are hiring for the service is registered with a valid Preparer Tax Identification Number. Anyone who is paid to prepare or assists in preparing federal tax returns is required to have a PTIN by law.
Confirm that the professional will both sign the return and include their PTIN.
"Not signing a tax return is a red flag that a paid preparer is likely not to be trusted," according to the IRS.
2. Confirm availability
Ideally, you want a preparer who is available year-round, and who won't disappear after tax season.
"If questions come up about a tax return, taxpayers may need to contact the preparer after the filing season is over," the IRS notes.
3. Understand the preparer's credentials
If you haven't found an accountant or CPA for this tax season, you can broaden your search to include tax attorneys and enrolled agents. Either can legally represent you before the IRS.
Some tax preparers only carry a PTIN. While they can prepare and file your returns, they cannot represent you before the IRS if there's ever a notice or an audit, Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida, previously told CNBC.
The IRS also notes that Annual Filing Season Program participants who prepare and sign a tax return can represent taxpayers in limited situations.
4. Review the preparer's history
Taxpayers can often look up information about the tax preparer to make sure there are no red flags.
- The Better Business Bureau and review sites such as Yelp may have information about the preparer as well as customer reviews and complaints.
- Visit credentialing organizations' websites to verify a preparer's status and check for disciplinary actions. For CPAs, check the State Board of Accountancy's site, and for attorneys, their State Bar Association, the IRS notes.
- For enrolled agents, use the IRS Directory of Federal Tax Return Preparers to verify their status.
5. Ask about fees
"Taxpayers should avoid tax return preparers who base their fees on a percentage of the refund or who offer to deposit all or part of the refund into their own financial accounts," the IRS notes. "Be wary of tax return preparers who claim they can get larger refunds than their competitors."
If you are having trouble finding a qualified professional in your area, think about strategies such as free or paid online filing options, volunteer income tax assistance programs or even filing your taxes later in the year.
