The Misconceptions!!

“You need to be a CPA or have an accounting degree to be a Tax Professional.”  NO!

Many people shy away from taxes because they think it will be too difficult and that you must be a Certified Public Accountant (CPA) or have an accounting degree or the equivalent.  The truth is you really don’t have to be an accountant to be a tax professional.

 While having an aptitude for dealing with figures is essential, high level knowledge of math and finance are not necessary and tax preparation is not accounting, it’s law.  You don’t even need to have a college degree to prepare taxes.

Then what DO you need?

You will need to take at least one tax preparation course to give you a solid foundation in individual tax. In addition, new IRS regulations require that you pass a basic competency exam to confirm your tax knowledge. Then you must register as a tax preparer and take 15 hours of continuing education each year going forward. Continuing education is a great thing as it will help you increase your tax knowelege and remain current with the tax code. If you wish to prepare business tax returns, you will also need to take a tax course on small business income tax. There is a different IRS competency exam you will need to pass if you are planning to prepare business tax returns.  

Most beginner tax preparation courses assume no prior tax knowledge and the tax preparer software available today makes tax preparation a lot easier.  That being said, tax preparer software is NOT a substitute for tax knowledge.  It’s extremely important that you are able to complete tax returns by hand in the event that your computer should be down or if there is a computer glitch.  You should never rely on any tax software program to train you or to prepare a tax return for you accurately.  It should simply be used as a tool to improve your service and make you more efficient.

“Tax Preparation is for ‘numbers’ people.”

It’s amazing how many people think that tax preparation is all about the numbers, but that’s not all.  Tax preparation is actually a people business.  So, if you enjoy working with people, you could do very well in the tax business.  It’s about building relationships and trust.

Yes, it is extremely important that you have the knowledge to prepare taxes accurately. The experience that your client has during the tax preparation process and after is just as important.  When you are dealing with a client’s financial information it becomes very personal.  Your client trusts you to take good care of him/her and hopes that you have their best interests in mind.  Your client is looking for guidance and has come to you because they see you as an expert in the tax industry.  You could prepare a client’s tax return perfectly but if they don’t receive personal service from you, they may not be back. Relationships are paramount!