Feb. 4, 2025

Who Can You Trust to Do Your Taxes?

Who Can You Trust With Your Taxes? Choosing the Right Tax Professional

Tax season can be a time of stress and uncertainty, especially when it comes to entrusting someone with your financial information. As Christians, we want to make wise financial decisions that align with our values and demonstrate integrity. Choosing a tax professional is no exception. This post will help you find a trustworthy and competent tax professional and answer the question: Who Can You Trust to Do Your Taxes while upholding your Christian principles?

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Understanding the Importance of a Tax Professional

Taxes can be incredibly complex, and the tax code seems to be constantly evolving¹. A qualified tax professional can help you navigate these complexities, ensuring you comply with the law while minimizing your tax liability. They can also offer valuable advice on financial planning and help you make informed decisions about your money. For example, a tax professional can help you understand the tax implications of different investment strategies or advise you on how to maximize deductions for charitable giving².

Types of Tax Professionals

There are various types of tax professionals, each with different qualifications and expertise. Here are a few of the most common:

Certified Public Accountants (CPAs): CPAs are licensed by state boards of accountancy and have passed the Uniform CPA Examination. They have a broad understanding of accounting and financial matters, including tax preparation and planning³. CPAs can provide a variety of services, such as maintaining financial records, examining financial statements, providing auditing services, and preparing tax returns. Some CPAs specialize in tax planning and preparation³.
Enrolled Agents (EAs): EAs are federally authorized tax practitioners who have passed a three-part Special Enrollment Examination administered by the IRS. They specialize in taxation and have unlimited rights to represent taxpayers before the IRS³. To become an EA, a candidate must pass the Special Enrollment Examination, which covers individual and business tax return preparation, client representation, and other aspects of being a tax professional³.
Tax Attorneys: Tax attorneys are lawyers specializing in tax law. They can provide legal advice on tax matters, represent clients in tax court, and assist with complex tax situations³. Tax attorneys apply their knowledge of tax law to the preparation of tax returns, tax planning, and providing advice to clients on long-range strategies for reducing their taxes³.
Non-credentialed Tax Preparers: These individuals prepare taxes without formal credentials like a CPA, EA, or tax attorney. They may have completed tax preparation courses or have experience working in the field³. This often includes seasonal tax preparers that work in tax stores and IRS Volunteer Income Tax Assistance Program volunteers³. The IRS offers a voluntary program for non-credentialed tax preparers called the Annual Filing Season Program. Participants in this program complete 18 hours of continuing education, including a six-hour refresher course in federal tax law, and receive a record of completion certificate from the IRS³.

Qualifications and Experience

When choosing a tax professional, consider their qualifications and experience. Look for someone with:

A valid Preparer Tax Identification Number (PTIN): The IRS requires all paid tax preparers to apply for and maintain a Preparer Tax Identification Number (PTIN). The PTIN lets you know that the tax preparer is authorized to handle your federal tax return⁴. Paid tax preparers must sign and include their active PTIN on any tax return they prepare⁴.
Relevant credentials: Consider whether a CPA, EA, or tax attorney is best suited for your needs⁵. For example, if you have a straightforward tax situation, a non-credentialed tax preparer might be sufficient. However, if you have complex tax needs, such as investments or a small business, you might benefit from the expertise of a CPA or EA. For legal issues related to taxes, a tax attorney is the best choice⁶.
Experience with your specific situation: If you have complex tax needs, such as clergy taxes or investments, look for a professional with experience in those areas¹. For instance, clergy have unique tax situations due to housing allowances and self-employment rules. It's essential to find a tax professional who understands these nuances¹.
Membership in professional organizations: This can indicate a commitment to ethical standards and continuing education⁵. Some notable organizations include the American Institute of Certified Public Accountants (AICPA), the National Association of Tax Professionals (NATP), and the National Society of Enrolled Agents (NAEA)⁵.
Strong analytical skills: Tax professionals need to be thorough and detail-oriented, with a keen eye for analyzing financial information⁷. They must be able to identify potential deductions, credits, and other tax benefits while ensuring accuracy and compliance with tax laws.
Familiarity with tax preparation software: Most tax professionals use software programs to prepare and file tax returns⁷. Some common software programs include Intuit Quickbooks, Intuit ProSeries, Tax Online, and TaxAct Professional⁷.
State-specific requirements: Some states, like California, have stricter regulations for tax preparers⁸. In California, anyone who prepares tax returns for a fee must be either an Enrolled Agent (EA), Certified Public Accountant (CPA), an Attorney, or a CTEC registered tax preparer (CRTP)⁹. CRTPs must complete 60 hours of qualifying tax education and hold a $5,000 tax preparer bond⁹.
Access to the IRS Directory of Federal Tax Return Preparers: This directory can help you find qualified tax professionals in your area². It allows you to search for preparers based on their credentials and location, making it easier to find someone who meets your specific needs.

Tools of the Trade: Tax Preparation Software

Tax professionals utilize various software programs to efficiently and accurately prepare tax returns. These programs help with calculations, ensure compliance with tax laws, and streamline the filing process. Some popular options include:

Intuit Quickbooks: This widely used software helps organize financial data, track income and expenses, and generate reports⁷.
Intuit ProSeries: Designed specifically for tax professionals, ProSeries offers advanced features for tax planning and preparation.
Tax Online: This cloud-based software allows tax professionals to access client information and prepare returns from anywhere with an internet connection.
TaxAct Professional: This software provides a comprehensive suite of tools for tax preparation, including e-filing, audit support, and client management features.

Christian Values and Your Tax Professional

As Christians, we should seek professionals who share our values. Here are some factors to consider:

Focus on giving: Does the tax professional understand and support your charitable giving goals¹⁰? A Christian tax professional can help you explore tax-efficient giving strategies, such as donating appreciated assets or setting up a donor-advised fund.
Biblical principles: Do they incorporate biblical wisdom and principles into their financial advice¹¹? For example, do they advise against excessive debt or encourage saving for the future? A Christian financial advisor might recommend resources like the "Financial Peace" program by Dave Ramsey, which promotes biblical principles for managing money.
Stewardship: Do they emphasize responsible and accountable management of God's resources¹⁰? This includes not only managing your finances wisely but also using your resources to help others and further God's kingdom.
Integrity and honesty: Are they known for their ethical practices and trustworthiness⁶? This is crucial when entrusting someone with your financial information. Look for a tax professional who is transparent about their fees and committed to upholding ethical standards.
Prioritizing family: A Christian tax professional should understand the importance of providing for your family's needs first¹⁰. They should not pressure you into charitable giving or other financial decisions that could jeopardize your family's well-being.

Fees and Availability

Before hiring a tax professional, discuss their fees and availability. Ask about:

Fee structure: Do they charge an hourly rate, a flat fee, or per form¹²? Hourly rates can vary significantly depending on the preparer's experience and qualifications. Flat fees are often used for simpler returns, while per-form fees might be applied for more complex situations.
Additional fees: Are there extra charges for e-filing, state returns, or other services⁶? Be sure to get a clear understanding of all potential costs upfront.
Availability: Will they be available to answer questions or assist with an audit after tax season²? It's important to have ongoing support, especially if issues arise with your return.

Audit Statistics

While having a tax professional doesn't guarantee you won't be audited, it can reduce your risk and provide valuable support if an audit occurs. Here's what you should know about audits:

Overall audit rates are low: In recent years, the IRS has audited less than 1% of all individual tax returns¹³. This means the vast majority of taxpayers are not audited.
Certain factors can increase audit risk: These include reporting significant income changes, claiming large deductions, having a history of tax issues, and being part of an industry with a higher audit rate¹⁴.
Higher earners are more likely to be audited: Audit rates increase for those with higher incomes¹⁵. For example, individuals with incomes over $1 million are significantly more likely to be audited than those with lower incomes.
Self-employed individuals have a slightly higher audit risk: This is because they often have more complex tax situations and may be more likely to claim deductions that trigger an audit¹⁴. However, the overall likelihood of an audit for self-employed individuals is still relatively low¹⁴.
Taxpayer rights during an audit: If you are audited, you have certain rights, including the right to professional and courteous treatment by IRS employees, the right to privacy and confidentiality, and the right to representation¹⁶.

Making the Right Choice

Choosing the right tax professional is a crucial decision that can have a significant impact on your financial well-being. By considering their qualifications, experience, values, and fees, you can find someone who will help you navigate the complexities of taxes while upholding your Christian principles. Here are some additional resources to help you in your search:

Better Business Bureau (BBB): The BBB provides ratings and reviews of businesses, including tax preparers⁶. This can give you insights into a preparer's reputation and customer service.
Referrals: Ask friends, family members, or your church community for recommendations. Personal referrals can be a valuable way to find a trustworthy tax professional.
Online reviews: Check online review sites like Google Reviews or Yelp to see what other clients have said about their experiences with different tax professionals.

Remember to pray for guidance and wisdom as you make this important decision.

Conclusion

Finding a trustworthy tax professional can provide peace of mind and ensure you're making sound financial decisions that honor God. By following the steps outlined in this post, you can confidently choose a professional who aligns with your Christian values and helps you steward your resources responsibly. Prioritize integrity, honesty, and a commitment to biblical principles when making your decision. Seek out a tax professional who not only understands the complexities of tax law but also supports your financial goals and your desire to live a life of faith and integrity. Don't hesitate to ask questions, pray for guidance, and trust God to lead you to the right person for your needs.

Works cited

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Guide to the 4 Types of Tax Preparers - TheStreet, accessed January 26, 2025, https://www.thestreet.com/taxes/types-of-tax-preparers
4 Tips to Help You Choose a Tax Preparer | Marcus by Goldman Sachs®, accessed January 26, 2025, https://www.marcus.com/us/en/resources/taxes/tips-to-consider-when-looking-for-a-tax-preparer
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Tax Professional: What Is It? and How to Become One? - ZipRecruiter, accessed January 26, 2025, https://www.ziprecruiter.com/career/Tax-Professional/What-Is-How-to-Become
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Types of Preparers - Marathon Tax Planning, accessed January 26, 2025, https://www.marathontaxplanning.com/index.php/types-of-preparers/
How to Choose A Reliable Christian Financial Advisor, accessed January 26, 2025, https://www.abrwealthmanagement.com/post/2-how-to-choose-a-reliable-christian-financial-advisor
Looking for a Christian Financial Advisor? - Wealthtender, accessed January 26, 2025, https://wealthtender.com/insights/financial-planning/christian-financial-advisor/
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Ralph V. Estep, Jr.

Christian Financial Consulting

Ralph V. Estep, Jr. is a highly accomplished professional with a diverse background in finance, accounting, technology, and entrepreneurship. As the principal at Saggio Management Group, Inc., he has demonstrated exceptional leadership and expertise in various roles throughout his career.

Ralph's educational journey began at St. Mark's High School in Newark, Delaware before attending the University of Nebraska where he was an esteemed member of the Cornhusker Marching Band and had the privilege of performing at the Florida Citrus Bowl in Orlando.

Continuing his pursuit of knowledge and excellence, Ralph earned a Bachelor of Science Degree in Accounting from the University of Delaware. He further expanded his academic achievements by obtaining a Master's in Business Administration from Wilmington University.

Throughout his professional journey, Ralph has been recognized for his outstanding accomplishments and commitment to excellence. He is a member of prestigious organizations such as the Golden Key National Honor Society and Beta Gamma Sigma International Business Honor Society.

With an extensive range of professional designations including Licensed Public Accountant (LPA), Accredited Business Accountant (ABA), Accredited Tax Advisor (ATA), Accredited Tax Preparer (ATP), and Internal Revenue Service Registered Tax Preparer (RTRP), Ralph possesses comprehensive expertise in tax preparation and financial management.

Beyond his impressive qualifications, Ralph has actively engaged with various community programs as bo… Read More

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