How to Choose the Right ‘Tax Guy or Gal’

The first question that people should ask themselves is “Do I need a tax guy or gal?” Whether people want to admit it or not, the answer for most people is YES! I know it might sound a little self-serving, but I firmly believe that once you are past the single W-2, living in an apartment stage of life, it is worth the time and money to pay a professional to prepare your taxes for you. When the original tax code was written in 1913, it was approximately 27 pages long. Now, 107 years later, it is over 4 million words and in excess of 5,000 pages long. Most of us that consider ourselves tax professionals, spent a great deal of time during our down time, keeping up with the constantly changing tax code.

While many people could successfully do their taxes through a DIY software, there might be valuable credits or deductions they are missing. Their return might be technically correct but how much money are they giving to the federal and/or state government? What about those people that are unhappy with the result at the end of the year but do not know how to fix it? What about those people that have a major change coming in their life, like a marriage or new baby or retirement? These scenarios and many more are where the value of hiring a tax professional becomes evident. A true tax professional can help you understand your tax situation and provide you with advice on changes.

So, you have decided that you need a tax guy or gal, or you just need a change…now what?

It will not be tough to find someone that is willing to do your taxes. However, it is worth doing a little bit of homework before sharing your most personal financial data with just anyone.

Several years ago, the IRS attempted to implement some standards and regulate who could prepare taxes for a fee. The idea was that this would drastically reduce the number of people that were at all shady and giving the rest of us a bad name. For many of us in the business, this was a welcome change. Unfortunately, after only a couple of years, the courts decided the IRS had overstepped their authority and eliminated the new regulations put into place by the IRS. So, we are essentially back to where just about anyone can prepare taxes and charge for it, regardless of knowledge or experience.

Now, it is up to the individual taxpayer to weed through the masses of sketchy tax preparers, to find the true tax professional. This raises another important point, there is a difference between tax preparers and tax professionals. Anyone can be a tax preparer, but a true tax professional is created through the knowledge and experience gained from years of practice.

The IRS has put out Top 10 list for choosing a tax preparer which can be found at This list is certainly a great resource but my intention with this article is to provide a few practical steps for everyone.

First and probably most important, do not just pick someone from a list provided by an online search. The average person will stay with their tax professional for 7 years or until something happens that causes them to change. From my own practice, I have clients that have been with me for almost 20 years. Take some time and interview potential tax professionals. This is someone that you might only see once per year, but it might become your most trusted advisor that you consult with throughout the year. If you do not feel a connection with this person, keep looking. This relationship is too important to settle.

Second, ask friends and family that you trust. Often, someone in your inner circle will have an excellent tax professional they would love to share with you. However, keep an open mind and realize that not every referral will be good. Again, take the time to sit down and talk to the referred professional and make sure you are a good fit.

Third, do not let price be the only factor in your decision. You have probably heard the phrase, ‘you get what you pay for’ but beware that just because someone charges you a lot does not make them better. Take into consideration that someone operating a sole proprietorship from their own home, can charge less than someone operating the same business from a rented office space. There are many factors that go into what a tax professional charges, so try not to allow price to be a deciding factor. Spend the time and investigate their experience and let that determine the value of their services.

Fourth, look at online reviews. In this day of technology, it is worth the effort to check out what people are saying online about the tax professional that you are looking into. Keep in mind though that online reviews might not always give you a complete picture of the person or the business. Unfortunately, many online reviews are written by disgruntled clients and are not necessarily a true reflection of that person. Take the time to read all the reviews and responses if there are any. If nothing else, this might give you something to talk about when you sit down and talk to the tax professional. Equally important, be cautious of all positive online reviews. While it is possible that everyone loves this person, it is unlikely that nobody has ever left there unhappy. Again, this is a great tool but should not be used as a sole decision maker.

Finally, if you are member of any online communities or groups, preferably in the community that you live or work, ask for recommendations. You will most likely get names that you did not see in your online searching and often will get the why behind the recommendations. If you are like me, you prefer to support small, local businesses and this will certainly give you options that fit that criteria. When you get a name or names, start back with the first step and do your due diligence before selecting.

There is no ‘one-size fits all’ when it comes to tax professionals. There are many exceptional tax professionals out there that are looking for new clients and would be happy to assist you. Spend the time, preferably during the off-season, and find the person that is the right fit for you. These suggestions are not necessarily in any order and many can be used simultaneously. The bottom line is that this is an important relationship and should not be jumped into haphazardly nor should you stay in a relationship with your tax professional that is uncomfortable or non-productive.