Are All Tax Preparers Created Equal?

Dear Friend,


Each year, various tax stores run advertising that subtly or even not-so-subtly disrespects Certified Public Accountants everywhere. Even more frustrating than the ads is that, often, members of the public are duped by these ads into thinking all tax preparers are created equal. For example, do you know if your preparer is authorized and able to represent you and your interests to the IRS and other government agencies? Not all tax preparers are allowed to do so.


Because of this and other misconceptions, I would like to point out some primary differences.


The CPA designation is one of the most widely recognized and highly trusted professional designations in the business world. CPAs are distinguished from other finance professionals by stringent qualification and licensing requirements.


The CPA credential carries enormous weight in business and financial circles. Achieving CPA status takes intelligence, ethics, integrity and lifelong commitment. First, candidates in my state must make it through 150 hours of college course work including some of some of the toughest business classes offered. After graduation and a year of experience under the supervision of a CPA, candidates must pass a grueling examination of business, auditing and general accounting skills.


The CPA exam was developed in the early 1900s to ensure the competence of CPAs entering the field, much as the bar exam evaluates lawyers and the medical boards test doctors. It maintains that goal to this day and it is continually revised to meet the changing demands of the profession.

The CPA exam is not the only requirement to be a CPA. CPAs are also required to follow a strict code of ethics and perform within the high standards of the profession. CPAs are also required to complete continuing professional education (CPE) courses to keep up with the new rules and regulations in the financial, accounting and business world.


When choosing a tax preparer, learn about credentials and reputation. Is the preparer an accredited tax preparer, enrolled agent, a certified public accountant, a licensed public accountant or an attorney? Also, keep in mind if the individual or firm will be around to answer questions about the preparation of your tax return months — or even years — after the return has been filed. It’s best to know how much help you will have before as well as after the filing of your tax returns. Also, CPA tax professionals often know a lot of essential information about your personal situation, so the continuity of service you receive from a CPA may be an important factor to consider.

Hearing the negative ad campaigns employed by companies with large budgets reminds me of one state's professional association’s accurate (albeit much smaller) ad campaign, which states, “Tax returns are black and white. Tax laws are not. It takes more than a little training and a lot of ads to become a real tax expert.”


Hopefully, taxpayers are paying attention to the truth.


William Deutchman, CPA