5 Key Things To Know About Ethical Tax Preparation and Fees

When you hire someone to prepare your income tax returns, you need to be able to rely on their skills and experience. You also need to know what to expect regarding fees as well as what legal rights you have involving those fees. To help you choose the right tax service, here are five key things to know about an ethical tax preparer and your bill.

1. The Preparer Can't Charge Contingent Fees.

Generally, when you hire a preparer to simply prepare and file the return, they cannot charge you based on your refund amount. The IRS expressly forbids this kind of fee because it encourages unethical behavior. Getting a bigger refund is nice, but you don't want one that comes at the cost of triggering an audit. 

2. The Preparer Must Give Back Your Documents.

If you have a fee dispute, the tax preparer cannot refuse to give back your original paperwork brought into heir office. The preparer is, of course, not beholden to give you a completed return without fee payment, though. While you might need to start over with an ethical preparer, you can still move forward from a bad experience. 

3. The Preparer Can't Oversell Their Services.

The IRS places limits on how a preparer can advertise their services and designations. An enrolled agent would be violating the rules, for instance, if they advertise that they are 'certified' by the IRS. And while the idea of a special skill or approval by the IRS may be appealing, a client should choose a preparer who is honest about their relationship with the IRS and how it relates to you. 

4. The Preparer Cannot Deposit Your Refund.

An ethical preparer will not cash or deposit your refund check in any way. The IRS protects clients from losing their hard-earned money to unscrupulous individuals or oversize fees. 

5. The Preparer Should Be Open About Fees.

You deserve to know what tax preparation will cost before you enter into any agreements. The IRS agrees with this, and it expects preparers to have a schedule of fees — including hourly rates, fees for particular forms, and consultation fees. Look for a tax service that is open about its charges so you can make informed decisions. 

As you choose tax preparation services, knowing what you can expect and what behavior isn't allowed will help you find a reliable, ethical service. Learn more today by making an appointment with a tax service in your area. 

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