Tax preparers, like the tax preparer in Tucson, prepare and file for paying clients state and federal tax returns. In several states, tax preparers may work alone, however in other states, it is needed for them to work under the guidance or supervision of an attorney, a CPA or Certified Public Accountant, or other tax experts.
To be a tax preparer, one must be knowledgeable with the numerous tax forms as well as the issued schedules or timetables by the state tax boards and the Internal Revenue Service (IRS). Moreover, one must also be familiar and comfortable working with mathematics and computers since tax preparers examine the financial accounts of clients and work with them to calculate and determine tax obligations, tax credits as well as deductions they may be qualified for. Appropriate forms are then filled out and submitted to the federal and state government on behalf of their clients, placing their name on the tax return to mention themselves as the tax preparer.
Starting a Tax Preparation Business
Numerous tax preparers discover that their passion and enthusiasm is in helping others out and going beyond to ensure a tax outcome that is most feasibly favorable for families.
At times, this passion drives them to start their own independent tax preparation business, however the questions of where and how to begin could be disheartening. Here’s how you could start:
Absorb everything you could about tax preparation and tax codes and get a certified.
If you have no sufficient knowledge regarding tax preparation, attend a school for tax preparation and/or sign up for a tax preparation course. For practiced tax preparers, be up-to-date and continually learn about tax preparation and codes.
After graduation in tax school, majority of these schools offer employment that is seasonal as a part-time job for tax preparers. Gain experience points by working for a tax preparation business and work with various individuals. Familiarize yourself with filing electronically as well as with the filling system of the IRS.
Legally structure and organize your business.
Create a limited liability company, a corporation, or a sole proprietorship. Get an attorney to make a draft of your articles of incorporation or organization and file them with the office of the state secretary. You could also opt to utilize a legal preparation service online. Have the name of your tax preparation business registered with the division of corporations of the state or the county clerk.
Purchase a software dedicated to tax preparation.
Tax preparation software are offered from several manufacturers. This software is intended for commercial usage and also provides electronic filing system with the IRS.
Get in touch with a certified insurance agent to ascertain which products as well as the amount of coverage you will be needing. Usually, an insurance on errors and omissions and liability insurances are what you necessitate.
Find a great location and space.
Look for a work space that could provide a space for a reception area, a consultation or conference room and an office. Another option is to have a dedicated workspace in the comforts of your own home to make your business “home-base.” Make certain you have a phone line exclusively for your business, access to the internet, adequate outlets for computers, printers and other needed equipment. Moreover, make sure you have ample storage since the IRS hard copies of the returns of your clients to be kept on file for five years in the event of an audit.