Tax season is just around the corner and if you’re looking to get one step ahead of this year’s IRS return, then check out our blog post about becoming a tax preparer. It will teach you about what it takes to become a tax preparer and how much money you can make. Plus, we’ll also be giving away two copies of TurboTax Deluxe for readers! To enter, just comment below with your favorite reason why you should become a tax preparer.
In the United States, taxes are mandatory for everyone. This means that you will be required to pay taxes on a regular basis, whether you have a job or not. Working as an independent tax preparer is an exciting and lucrative career path–but it’s also a difficult one. It takes time and dedication to become an expert at tax preparation. However, if you are willing to put in the work, it can be rewarding both professionally and financially.
Learn how to become your own tax preparer by brushing up on some basic principles of taxation, tips on how to better prepare your clients’ returns, and advice on what you need to know before pursuing this career path.
What is tax preparer?
There are a lot of people who don’t know what a tax preparer does and how they do it. They might also not be aware that a tax preparer is different from an accountant, or why there are two different types. If you’re one of these people, this blog will explain exactly what tax preparers do and how they contribute to society.
A tax preparer is an individual or company who helps with the preparation of income tax returns for individuals and corporations.
There are a lot of misconceptions about tax preparers. Mostly, people think it is too complicated to be a tax preparer when in fact, anyone with basic math skills can become one. And for those who have an interest in learning about taxes and the government, the tax preparer profession might just be for you! Here are some ways to get started on your tax prep career today.
Is it hard to be a tax preparer?
What does a tax preparer do?
The Internal Revenue Service has a lot of rules, regulations, and laws for businesses. They also have a lot of ways to collect taxes from businesses. In order to do this, they employ tax preparers. Tax preparers are individuals who help businesses with the complicated process of filing taxes in compliance with all IRS regulations. This job can be full of fun and interesting stories that make it worthwhile. Find out more about what a tax preparer does by checking out this blog post!
Tax preparers are finance professionals who prepare and file individuals’ and businesses’ tax returns. They meet with clients to gather their tax information, such as marital status, number of children and other dependents, salary and other taxable income among other information required by the Internal Revenue Service (IRS). Then they fill out, sign and file all the appropriate forms according to federal and state tax codes. Since tax returns can range from simple to extremely complex, many people and companies hire tax preparers to do their taxes correctly and make sure they get the greatest tax refund for their situation.
Tax preparer responsibilities can include:
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Performing administrative duties, such as answering phone calls and setting up appointments
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Gathering and organizing personal and confidential paperwork on clients’ income, expenses, allowances and more
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Understanding adjustments, credits and deductions, as well as federal and state tax laws
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Doing math equations and double-checking calculations and data entries to make sure they are correct
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Working with financial and accounting software
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Providing clients with future tax planning advice and recommendations
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Processing billing for time spent doing clients’ tax returns
Tax Preparer salary
Taxes may not be the most exciting topic to talk about, but they’re inevitable and can lead to a huge headache for anyone who has to deal with them. If you are someone who is thinking about becoming a tax preparer, this article will give you an idea of what it’s like on the inside.
TAX PREPARER SALARY:
Tax preparation is one of the more lucrative careers in America. So if you’re looking at getting into the business, there are a few things that you should know beforehand. Tax preparation salaries vary depending on how well-known and prestigious your company is, how many hours you work per week, how much experience you have, and whether or not you end up working full-time or part-time. Most tax preparers earn anywhere between $25-$50 per hour. That might not seem like very much, but when you compare it to other jobs such as nursing assistant ($10-$12 per hour) or certified nursing
Average salary
Tax preparers typically get paid by the hour, depending on how much time they spend working on each client’s tax returns. Some salaries may depend on the number of clients they have, their clientele’s financial background, their geographic location and their level of experience.
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Common salary in the U.S.: $16.65 per hour
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Some salaries range from $7.25 to $40.20 per hour.
Tax preparer requirements
Everyone has to pay taxes, but not everyone is required to have a tax preparer. When you’re looking for a tax preparer, make sure you find someone who is knowledgeable about how the IRS looks at your particular case so they can give you the best advice on your budget and situation. They should also be able to file your taxes quickly and efficiently while ensuring they don’t make any mistakes that could get you penalized by the IRS. Here are some things to consider when searching for a tax preparer.
These professionals often need a combination of the following requirements to secure employment:
Education
Many companies require tax preparers to have at least a high school diploma or its equivalent and often prefer candidates who have taken courses in tax preparation or accounting. Some accounting firms looking for experienced tax preparers might require an associate’s or a bachelor’s degree in accounting or business.
Training
Many companies provide their tax preparers with on-job training in the accounting, taxation, scheduling, data management and spreadsheet software they use. Before applying for jobs, tax preparers might take webinars or vocational school courses to practice the accounting skills they will need to do their work. They might also research tax laws so they can be prepared to answer clients’ questions.
Organizations that can provide high school graduates with the training they need to become tax preparers include:
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The Accreditation Council for Accountancy and Taxation (ACAT)
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The National Association of Tax Professionals (NATP)
Certifications
All tax preparers must have a Preparer Tax Identification Number (PTIN) from the IRS. To get your PTIN, simply visit the IRS website, create an account and fill out the application. You will then receive a PTIN you must use on every tax return you prepare and sign. To be eligible for more advanced tax preparation jobs, you might need to be certified as:
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A certified public accountant (CPA): A state license that requires completing accounting courses or an accounting degree, plus passing the Uniform Certified Public Accountant Examination.
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An enrolled agent (EA): A federal license that requires studying for and passing the Special Enrollment Examination. This certification enables these professionals to represent their clients in taxation matters.
Both certifications require you to complete a certain number of continuing education hours every few years to keep your credentials.
Tax preparers might also pursue certification or membership with one of several professional organizations to show their dedication to the profession and commitment to furthering their knowledge. These associations include:
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American Institute of Certified Public Accountants
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National Association of Tax Professionals
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National Association of Enrolled Agents
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Institute of Management Accountants
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National Society of Accountants
Skills
Here are the most common skills required for tax preparers:
Customer service
Tax preparers should be approachable and friendly with excellent interpersonal skills. Clients should feel like they can trust their tax preparer with sensitive financial information and accurate documentation of their earnings to the government.
Attention to detail
These professionals must make sure all the data they collect and enter is accurate and that their calculations are correct. Accurate reporting of a client’s salary and deductibles can ensure they pay the right amount of taxes and earn the most comprehensive return each year.
Mathematics
Tax preparers work extensively with numbers and should be skilled in arithmetic, statistics and problem-solving. These skills enable them to properly fill out the many numerical fields on tax documents.
Critical thinking
Tax preparers must determine the best approach to each client’s taxes to make sure they get the greatest return. They may research laws and updates of deductibles to identify every possible option for their clients.
Communication
These professionals must be keen verbal and written communicators to ensure clients understand each step of the process and what actions they made need to take during the filing process. They may also guide their clients on how best to prepare for the next tax season, including how to adjust their withholdings and save for future tax payments.
Tax preparer work environment
Tax preparers are busiest during the tax season of January 1 through April 15. They may work overtime and on the weekends during this period, and the days may be fast-paced. They might work well over 40 hours a week. Many tax preparers only do this job seasonally or part-time.
Tax preparers typically work in private or shared offices with some travel required to meet with current clients or try to find prospective clients. They work closely and frequently with other tax professionals and individual or corporate clients.
How to become a tax preparer
If you have the math, computer and customer service skills to be a tax preparer, you can start applying for jobs right out of high school. However, certain experience and training can help you become a more attractive job candidate. Steps to becoming a tax preparer might include:
1. Complete entry-level education.
Earn your high school diploma or pass the General Educational Development (GED) test to gain the basic qualifications to be a tax preparer. In possible, tax advanced math courses and those that practice statistics and taxation.
2. Gain customer service experience.
Many employers prefer candidates who have at least a year or two of work experience in retail, administrative, customer service or similar position. These roles can allow you to practice your interpersonal and problem-solving skills.
3. Take tax preparation courses.
To become familiar with tax laws and documents, consider enrolling in accounting or taxation courses at a local or online technical college or vocational school. Professional organizations such as the ACAT or NATP also provide courses and resources for aspiring or current tax preparers. Courses might cover topics such as deductions and exemptions, taxable benefits, refund calculations, electronic filing, tax codes and more.
4. Apply for your PTIN.
Fill out the PTIN application form through the IRS website. You will need to have information such as your Social Security number and previous year’s tax return available when applying. Getting your PTIN gives you the minimum requirement to prepare taxes.
5. Earning CPA or EA certification.
To advance in your tax preparation career or be eligible for full-time rather than seasonal tax jobs, you might pursue state or federal certification as a CPA or an EA. Each state sets its own CPA requirements, but you typically need to have a certain number of coursework hours or college credits, plus two years of work experience, to take the exam. To become an EA, you must pass the three-part exam, which usually takes three to eight months to study for and complete.
Tax preparer job description example
Our tax service firm is looking for a detail-oriented and personable tax preparer to join our growing team. The tax preparer will interview clients, provide them with advice and complete all their necessary tax forms. This individual will also research tax laws as needed and perform basic administrative duties, such as answering phones and setting up appointments for the entire office of preparers. The ideal candidate will have excellent math and computer skills as well as exceptional customer service and have their PTIN certification. We will provide training on how to use our company’s tax software programs.
Candidates are required to have a high school diploma or GED, but those with an associate’s degree or college credits are also encouraged to apply.