Tax Consultant
What Is A Tax Consultant?
Tax consultants, also known as tax preparers, specialize in knowing tax laws and are able to prepare income tax returns for individuals and small businesses. Each state has different requirements for the amount of education an individual must have to be a tax consultant. Researching those requirements can be done by checking with a state’s Board of Tax Practitioners.
How Do I Choose A Tax Consultant?
Many unlicensed tax preparers with questionable credentials set up shop during income-tax season. Some disappear after the April 15 filing date, leaving you to deal with the IRS if there’s a problem with your return. The IRS recently cracked down on such rogue tax preparers by, among other things, contacting those whose returns have frequently shown to have errors. Plus, it is instituting stricter rules for anyone who charges a fee to prepare a tax return. One good approach is to look for an enrolled agent.
What Is An Enrolled Agent?
According to the IRS website an enrolled agent is a person who has earned the privilege of representing taxpayers before the Internal Revenue Service by either passing a three-part comprehensive IRS test covering individual and business tax returns, or through experience as a former IRS employee. Enrolled agent status is the highest credential the IRS awards. Individuals who obtain this elite status must adhere to ethical standards and complete 72 hours of continuing education courses every three years.
Enrolled agents, like attorneys and certified public accountants (CPAs), have unlimited practice rights. This means they are unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before.
I’m Facing An IRS Audit. How Can A Tax Consultant Help Me?
An Enrolled Agent (EA), an Attorney or a Certified Public Accountant (CPA) can represent you without you being present at an audit. A Licensed tax consultant can represent you if that person prepared the return. But to go beyond the scope of the original preparation, you need a federally authorized tax practitioner (an EA), a CPA or an Attorney, who can see you through not only the audit, but an appeal or a collection issue as well. If you have documents to verify every item on your return and you just have to provide them in an organized fashion for review, your preparer is the best person to represent you. If you are missing documents, if there is some question about a deduction or the representation of some portion of your income, that’s when you need an EA, a CPA or Attorney.
I Hired A Tax Consultant To File My Taxes. Now I Find Out The IRS Is Disputing The Return.
The first step to consider when you get notice of an error on your tax returns is filing an amended return. In some cases, the error is simple; a transposed number, a missing form or some other easily-corrected error. If this happens, you can use Form 1040X to amend the return and provide the information requested by the IRS.