01/ 19/ 2005
by Jeffrey Moses
Tax codes have become so complex that most business owners choose to use experienced accountants, tax attorneys or other tax specialists when preparing tax forms. An expert not only can assure that a company's tax records and forms are in order, but also can be sure that all available deductions have been taken.
When interviewing and selecting a tax preparer, consider the following:
- Determine the certification and education the individual has.
- How long he or she has been in business?
- How experienced he or she is with small businesses in general?
- Most importantly, decide if he or she will be personally working with you and preparing your forms.
Many accounting and tax-preparation firms assign clients to less experienced staff. If you can't get a straight answer about who will be working on your behalf – and if you can't interview that person directly – that firm probably is not for you.
When selecting an individual or firm to prepare taxes, the following attributes and experience should be considered:
- The experience the preparer has with companies similar to yours in revenue, type of business and number of employees. It's not necessary that he or she have worked with companies in your specific field, but breadth of experience with comparable firms should be discussed. The preparer should supply you with a list of former and/or present clients. Call some of these clients to see what their experiences have been with the preparer.
- Familiarity with and experience working with the retirement funds your company offers employees and owners.
- Whether the preparer will be able to continue working with you in future years. Working with the same tax expert over time will minimize expenses and give him or her the chance to really know your business. Familiarity with details of your company's operations will help minimize mistakes and maximize potential deductions.
- Do you and the preparer seem to have a shared general vision of how to approach tax deductions? Some preparers are highly aggressive when it comes to taking deductions, and this can make some of their clients uncomfortable. On the other hand, an overly conservative preparer may cost you money by not taking legitimate deductions. Find a good fit by discussing the preparer's attitude on deductions.
- The preparer should not be so overburdened with clients that he or she will get to your returns only at the last minute, just before your filing deadlines. It's important that you have time to review your returns and be able to discuss alternatives and make corrections well in advance of filing.
- Ask if the preparer will represent you if you are audited. Also, will the preparer pay any penalties caused by his or her errors?
- Make sure that your preparer is accessible and available. Does he or she return your phone calls promptly? Some individuals, even in the service fields, are poor communicators. This makes it difficult for clients to contact them. If a preparer doesn't get back to you promptly during non-tax time of the year, imagine how hard it will be to get his or her attention when tax-crunch season is on.
