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How to Become a Tax Preparer

Doing your taxes can be stressful. It’s something most people don’t look forward to. If you want to be trained and specialized in helping others prepare their taxes, then you should learn how to become a tax preparer.

Anyone can be a tax preparer and it doesn’t require years of study or a college degree. If you have a passion for helping others and the skill, you can work in this career field today. Find out how to become a tax preparer in 2020 with this career guide.

What Is a Tax Preparer?

A tax preparer calculates, signs, and files tax returns for businesses and individuals. They can represent the taxpayer during examinations of the individual’s tax returns.

Over half of all taxpayers hire a tax preparer to file a tax return for them. Tax preparers are trusted with personal and private information, such as a person’s income, children, social security number, and marriage information.

What Does a Tax Preparer Do?

Tax preparers primarily prepare and file tax returns, or assist people or businesses with general tax forms. However, there are duties and responsibilities tax preparers have that go beyond these services. Below is a list of the things a tax preparer does for their clients.

Meeting with Clients

Tax preparers regularly meet with their clients to help them prepare their tax returns and get all of the information they need. These meetings can be lengthy, depending on how prepared the client is to do their taxes.

Collect Financial Information

One of the most difficult things about doing taxes is collecting financial information. A tax preparer collects this information for the client’s current year. This includes income statements, expense documents, social security numbers and names of dependents, and any other forms the client wishes to submit.

Preparing Tax Returns

After getting information from their client, tax preparers prepare tax returns for them during the tax season. This may require the use of professional tax software and related apps. In most cases, tax preparers file electronically to reduce the chances of making an error and decrease the time it takes to process tax returns. The IRS even offers a free service to file your taxes for those who need it.

Help Clients Get Their Refunds

If a client is going to receive a refund after doing their taxes, the tax preparer does all the work to help ensure the client receives the refund through bank products and tax refund advances. In some cases, a tax preparer can help a client receive their refund faster by setting up a direct deposit for you.

Essential Tax Preparer Skills

Good with Numbers

The first skill needed to be a great tax preparer is mathematics. If you aren’t good at making calculations or you don’t enjoy it, then you’ll likely struggle in this field.

Modern software will do a lot of the work for you, but you must still have strong mathematical skills and be able to spot any errors or typos. Doing the math for taxes can be difficult and it is rarely straightforward, which is why strong skills in math are a must.

Problem-Solving Skills

Tax preparation involves finding unique ways to solve problems. The best preparers use different techniques for deductions, filing changes, and other ways to reduce the financial burden of their clients.

Often, you’ll have a strong understanding of a client’s financial standing, even better than they do. You’ll need that understanding and knowledge of the tax code to prepare their taxes properly and help them earn their refund.

Communication Skills

Working as a tax preparer means having a strong understanding of the tax code. This is complex information that you have to communicate with people in a way that anyone can understand. This requires you to have clear verbal and written communication skills.

Those skills help you get the financial information you need and establish a relationship with your clients. Remember, your client is trusting you with their personal information, and having good communication skills is vital to earning that trust.

Attention to Detail

You must be vigilant when preparing the taxes of your clients. Being a tax preparer means interpreting the tax code in a specific way. Make sure you proofread documents closely and take care of even the slightest error. This is vital to make sure there are no issues when filing taxes.

Organization and Time Management Skills

When you’re a successful tax preparer, you’ll be tasked with working for multiple clients and even businesses. Handling everyone’s taxes can be a daunting task and it requires a great deal of work and practice.

Strong organizational and time management skills are a necessary aspect of being a tax preparer. These skills help you stay on top of things, properly file the taxes of all your clients, and make sure you help them meet their deadline.

Tax Preparer Job Outlook and Salary

According to the Bureau of Labor Statistics, the median annual salary of a tax preparer was $43,080 as of May 2019. The job outlook for tax preparers isn’t specifically listed, but the job outlook for accountants and auditors, who can work as tax preparers, is listed as four percent, which is about average.

Some of the factors that impact employment as a tax preparer include experience, location, skills, and certifications.

How Long Does it Take to Become a Tax Preparer?

The interesting thing about being a tax preparer is that you can become one immediately. You can receive your preparer tax identification number (PTIN) from the IRS at any time. Tax courses, such as the one provided by H&R Block, take around three months to complete.

This is the fastest way to become a non-credential tax preparer, which requires no higher education or licenses.

How to Become a Tax Preparer: A Step by Step Guide

It’s simple to become a tax preparer and you can do so in just a few steps. This means that you can work as a tax preparer within a matter of months and choose to do it seasonally or full-time, based on how much you’d like to work in the field.

Step 1: Take a Tax Course

The first step to becoming a tax preparer is to take a tax course. Several national organizations offer tax courses and they are relatively low in cost. These courses teach you how to prepare tax returns, research tax issues, and how to file most tax forms for individuals.

These courses can take anywhere from 10 weeks to a few months to complete. Find out what courses are available in your area and which ones are best for you.

Step 2: Get Your PTIN

After you’ve completed your tax course, the next step is to register with the IRS and get your PTIN. This identification number allows you to not use your social security number when preparing another person’s taxes.

It takes around 15 minutes to apply for a PTIN online. It takes around four to six weeks for the application to process. Most people register for their PTIN as soon as possible, even before taking their tax courses.

Step 3: Register with Your State

Once you’ve got your PTIN, you need to register with your state to become a tax preparer. This isn’t always a requirement. Check what your state requirements are and find out if you need to register before you can work as a preparer.

Step 4: Work as a Tax Preparer

After you’ve completed the above steps, you can work as a tax preparer. There are several ways to do this. Some tax preparers are self-employed and get clients on their own. Others work with a tax company and prepare taxes for that company’s clients.

If you take a tax course from a tax company and meet their requirements, you have a high chance of getting hired by them.

Should You Become a Tax Preparer in 2020?

Being a tax preparer offers you several benefits, such as being self-employed, working in an in-demand field, and even working seasonally, if you wish. Some people become tax preparers to earn extra money during tax season and others become one to work full-time.

With the options available to you and how quickly you can become one, there are many reasons to become a tax preparer. If you enjoy the work, you should become a tax preparer in 2020. After all, everyone has to do their taxes.


How much does it cost to get a PTIN?
It’s free. There’s no fee to get or renew your PTIN.
Do I need a license?
No, the IRS doesn’t require you to have a license to work as a tax preparer.
What education do you need to be a tax preparer?
There’s no education requirement. However, there are several educational opportunities and credentials needed to increase your credibility.
Do tax preparers work throughout the year?
Most do, but some tax preparers only work seasonally.
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