5 Questions to Ask Before Hiring a Tax Professional

With tax time right around the corner, you might be wondering how to choose a tax preparer for your business if you don’t already have one that you use and trust. While there’s always the option to prepare and file your taxes on your own, it is advantageous to hire a professional, particularly if you run a business.

Why? Perhaps most importantly, they can save you money because they know all the ins and outs of tax regulations and deductions, including what has recently changed. They stay abreast of any new tax code while the rest of us are busy focusing elsewhere. It’s also nice not to have to do all the work that goes into completing the necessary tax paperwork and filing the returns. And having someone to lean on and ask questions if you’re ever audited can provide peace of mind (choose a good tax professional who is available all year long).

So how do you pick the best tax preparer for your business? Ask the right questions when you’re shopping around and scoping out various candidates prior to selecting one! Below is a list of five questions to ask anyone you’re considering hiring:

Question #1: What Kinds of Clients Do You Work With?

Some tax professionals specialize in a particular industry while others work with a more diverse clientele. It’s imperative that you ascertain the type of service they provide and to whom so that you can ensure this matches with what your business does and needs. For example, if you run a tech company and the tax preparer you’re considering specializes in the restaurant industry, they probably aren’t the ideal fit.

(A quick reminder as well to choose a tax preparer who primarily works with small businesses. For more information about this, please check out this article.)

Question #2: Are You Available Year-Round?

There are tax preparers out there who will literally fall off the face of the planet after April. You’ll never hear from them again after they submit your tax return. As a business owner, this is the opposite of what you need. Instead, aim to find someone who will be available and responsive throughout the year if you need help with any tax-related questions or get audited by a tax agency.

Question #3: What’s Your Experience With the IRS?

This question, though not a standard one, will give you valuable insight into how much experience a tax professional has working with tax agencies. No matter their response, delve deeper. If they have a lot of experience dealing with the IRS, this might be a red flag indicating that their (shoddy?) returns get frequently audited. On the other hand, it could also mean that they are an enrolled tax agent with a license to represent or have many years of experience, which is a good thing!

On the flip side, if they say that they have little to no experience working with the IRS, they might be inexperienced or they’re doing great work and their clients aren’t getting flagged for audits. So listen to their initial reply, and then dig deeper to truly find out more about them.

Question #4: How Do You Bill for Your Services?

Find out if they will expect full payment upfront, a deposit and final payment, or payment at the end. This information will help you plan and allow you to know what to expect.

Question #5: What Tax Program Do You Use?

Although it sounds somewhat unusual, this question will help you determine if the person you’re talking to is a seasonal tax preparer or part of a full-service tax accounting firm that will be there to help support you year-round. Someone who is moonlighting (filing tax returns on the side for extra money) probably won’t use professional tax software to file your return – they’ll just pretend to be you when they file, thereby avoiding the need to invest in the expensive programs that a year-round tax preparer will use.

A Final Word From Tuesday Brooks Founder of AJOY Choosing the right tax professional will ultimately save you money and headaches. It’s crucial to find someone who is responsive and supportive all year long, specializes in both small businesses and your industry, is experienced in working with the IRS for the right reasons, and uses professional tax software so they can properly file your return. You’ll easily find the right tax preparer for you and your business if you take the time to ask the questions above. Wishing you the best of luck!