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How To Choose The Right Tax Professional For Your Business

Wise are those who learn from their mistakes. However, working with the right tax professional can prevent you from committing mistakes. A tax professional can guide you on multiple business areas and financial management.

Tax professionals do not just prepare taxes; they are your guides to manage business finances and achieve desirable financial health. Thus, it’s crucial to choose the right tax professional who understands your business, fits in well and helps you ease your financial stress throughout the year.

There are different types of tax professionals – it’s essential to know about them before choosing one.

Types of Tax Professionals

Any individual can become a tax professional. A tax professional may or may not be authorized by the IRS (depending upon the services they provide) but make sure that you hire someone who is one of the following:

Certified Public Accountant (CPA)

CPA is the title given to accounting professionals who are regulated and licensed by their states. They are responsible for performing tax and business-related accounting tasks. If you own a medium or large business with complicated tax calculations, you might not be able to do without an experienced CPA or a CPA firm. Smaller organizations can go for smaller firms as they offer their services at a much lower price.

Enrolled Agent (EA)

An EA is a tax professional licensed and authorized by the IRS. There are two ways to become an EA – by clearing a test or working with the IRS for at least five years. If you’re on a restricted budget, an EA can easily provide bookkeeping and tax assistance.

Tax Attorney

Tax attorneys are not typical tax professionals. They are lawyers who have completed a special master’s tax law degree or have a certification from a state bar association. Their services are expensive as they offer tax-related legal advice. You should consult one if you’re in trouble with the IRS.

Whoever you choose, make sure that the tax professional should meet your requirements and must be experienced in handling similar-sized companies. It’s a bonus if there’s someone who knows you and your business/industry.

Tips to Choose the Right Tax Professional

1. Do Not Hurry

Hiring the right tax professional is crucial for your business. It is not advisable to be in a hurry for completing this process; interview several people for the role. Create a proper interview process where you talk to different tax professionals and know about the services they offer. After you’ve met all of them, make the final call.

2. Know their Thoughts on Data Security

It might never occur to you to inquire about the security of your data from your tax professional, but it is highly recommended. Your financial data is the backbone of your business, and it should be handled with the security it deserves.

Ask if:

  • They take the backup of data on regularly.
  • They take any measures to ensure security from ransomware attacks.
  • They encrypt documents with sensitive information.

3. Ask for a PTIN

If you choose someone who is authorized by the IRS, they must have a PTIN (Preparer Tax Identification Number). Please ensure that your tax professional has a PTIN as the IRS requires his PTIN on your tax returns. Please note that people who are not tax professionals, and voluntarily help you prepare your taxes, do not require a PTIN.

4. Ask about their Qualifications

There was a time when anyone could become a tax professional in the USA, but then came a time when the IRS came up with PTIN. However, attaining a PTIN became easy with time. Thus, the IRS introduced the Directory of Federal Tax Return Preparers with Credentials, for business owners to verify if their tax preparer is genuine. This ensures that you are not cheated by any person claiming to be a tax professional and get the right standard of services and.

5. Compare the Fees

After talking to a number of tax professionals, narrow down the potential candidates to a few. Then, it’s time to call them again to inquire about their fees. Also, you can send them emails and get detailed answers of the same.

You need to know whether they charge per hour or a fixed amount. Please note that genuine tax professionals would never promise that they would get you more refund than any other professional. If such is the case, it’s better to move away.

6. Check if they’d have your Back

A tax professional who just has a PTIN cannot represent you if anything goes wrong with the IRS. Whereas, a tax professional who has completed the Annual Filing Season Program can do so. Check with them when the tax season is over, and the IRS comes at your doors for an audit, will the person you’re willing to hire have your back?

7. Check if they e-File

The IRS has made it mandatory for tax professionals to file electronically if they file more than ten returns. So, if a person doesn’t file electronically, it’s clear that he’s not experienced and hasn’t done much of tax preparation work.

8. Inquire if they’d Sign on your Return

The IRS requires the tax prepares to mention their PTIN while filing their clients’ returns and also sign it. If a tax professional does not agree to it, it’s a red light. There are high chances that he is a fraudster who will make you sign a blank return and enter his bank account details to get the tax refund.


Please remember that it’s your business, and you’re responsible for making the right choices. Thus, it would help if you were very careful while choosing the right tax professional for your business. You’ll share your financial data with him; make sure that he’s genuine and offers the services you need.

Ajeet Sharma, the founder of Financegab and a well-known name in the field of financial blogging. Blogging since 2017, he has the expertise and excellent knowledge about personal finance. Financegab is all about personal finance which aims to create awareness among people about personal finance and help them to make smart, well-informed financial decisions.


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