Not all of us are comfortable doing our own taxes. The process can be fairly complicated and it's way too easy to make seemingly simple mistakes that could end up costing us more than an arm and a leg. If you can afford it, it makes sense to pay a financial professional to do all the hard work for you. But tax consultants and preparers are as fallible as the rest of humanity and just as capable of making tax mistakes. You want to be sure that your tax consultant keeps you out of the headlines and safely in the black.
When choosing a tax preparer, it's best to hire the most qualified professional that you can afford. Many people turn to family members just because they're good with numbers, or because they feel that they can trust them. Often, this doesn't work out as well as planned. The newspapers are full of stories of family members swindling each other and doing each other in; just ask tennis legend, Steffi Graf, whose dad made headlines on account of his creative bookkeeping.
Credentials are important. Don't be afraid to ask questions regarding education, accreditation and experience. You need to feel reassured that your professional is well equipped to deal with your particular tax issues, and that he or she maintains the learning process, keeping up to date on current news, trends and developments. You may also want to know what professional associations or organisations he or she belongs to, and by what code of ethics, if any, he or she is bound.
Do a little investigating to find out about fees. Fees vary according to the complexity of your tax situation. It helps if you have an idea of the mean fee for your particular situation: that way you'll know when you're being exploited. It's important to bear in mind, however, that large firms are likely to charge more than independent contractors. The size of the city that you live in is also likely to affect your fee, with consultants in larger cities charging more than those in smaller towns.
Know what you are getting for your money. When visiting a large firm, your consultant may not necessarily be the same person who will ultimately manage your taxes. You need to be aware that your finances may end up in the hands of a trainee and not the consummate professional you initially met. Considering how much is at stake, would you be comfortable with that?
Lastly, remember that no matter who does your taxes, you are the one who will be held responsible for your returns, mistakes and all. So before you submit your taxes, you may want to have one last meeting with your consultant to double check all the figures and look for mistakes. The extra appointment may cost you a little more in fees, but not nearly as much as an audit will cost you.
