You can use the IRS’s Directory of Federal Tax Return Preparers with Credentials and Select Qualifications to find a preparer in your area with the level of expertise you require, confirm his or her credentials, and make sure he or she has an up-to-date PTIN (anyone who is compensated for preparing a federal tax return must have one).
The IRS also suggests checking for disciplinary actions and the status of any credentialed preparer’s license. You can find both, if your preparer is a CPA, through the National Association of State Boards of Accountancy’s
CPAverify tool. If you are using an attorney, contact the State Bar Association where he practices. For enrolled agents, use this form from the IRS.
Also, be on alert for common red flags, including the boast that a preparer can get you a larger refund then the competition, or a promise of a certain refund without having seen any of your records or previous tax returns, says Wu. And ensure that your refund is deposited directly into your bank account, not into your preparer’s account.
“You want to make sure your refund is obtained legitimately. If you get audited, you are on the hook,” says Wu. “If the return contains fraudulent deductions, there can be serious consequences like being banned from taking the earned income tax credit in future years.”
A good preparer will need to see your records and receipts and ask questions about your finances. He or she should not use your last pay stub instead of your W-2 to complete your return, as this is illegal, says Amelia O’Rourke-Owens, staff attorney for Reinvestment Partners, a nonprofit that provides tax assistance to low-income people and works to end predatory lending practices.