BY ROBERT FARRINGTON

It’s that time of the year – time to do your taxes. While some Americans will attempt to do their taxes at home, the majority will seek some type of professional help (about 80% either use a paid preparer or tax software).

If you’re pressed for time or uncomfortable with taxes, hiring someone to do them for you can be a great help. But, just like with anything you outsource, you need to do your homework to make sure you don’t get scammed. Tax preparation is no different.

Here are three things you need to think about when going to get your taxes done.  These issues are common, even at major tax preparers.

Be vigilant to these three things that your tax preparer is probably not going to be upfront with you about.

How Long They've Been Doing Taxes

Did you know that just about anybody can be a paid tax preparer?  Literally, anybody.  There are very limited requirements for any type of certification, training, registration, or competency testing.

The IRS tried to put new measures into place, but the courts have an injunction in place for the time being. While many big companies send their employees through in-house training, that may not always be the case with franchised tax preparation companies.

That means the first thing you want to consider is how long the paid preparer has been doing taxes.  Since there is no mandatory qualifications that must be done, you need to check their experience. Is this their first year doing taxes, or are they a seasoned professional with 20 years under their belt?

Have they even filed their own taxes before? Seriously…there is nothing stopping a high school student from being a paid tax preparer.

Now, there is nothing wrong with using a new tax preparer. In fact, they may be cheaper, or more tech savvy than someone who’s been doing it a long time. But, if you have a complex return, you may want someone who has experience doing that type of return to help you with your taxes. 

How Much Experience They Have

Along with how long they’ve been preparing taxes, you also want to understand how much experience they have and whether that experience matches your needs.

For example, a high school student could be a great tax preparer for a simple return – plug in your W2, enter your interest income from your 1099-INT, check standard deduction, and done.

But what if you run a small business? What if you’ve derived income from multiple sources, including royalties or partnerships? If you have a rental property, how will they help you understand your expenses and the type of depreciation schedule you need? Are you doing a trust tax return?

At this point in time, you may also want to consider if a paid preparer is right for you? Maybe you would benefit more from someone that does have an advanced certification, like a Certified Public Accountant (CPA)?

The bottom line is that you need the experience of the person preparing your taxes to match your needs.