Choosing a Tax Advisor

by Charlotte Wood
(last updated February 21, 2009)

Taxes can be so confusing and I know that I really don't know what I'm doing when it comes to that area of finances. I usually ask the accounting majors at school to do my taxes, but I realize that's not necessarily an option for most people! So if you don't really know how to do your taxes, how can you sort out what's what with your money? A tax advisor may be a good option for you to look into, especially if you don't want to pay the money for someone to prepare your taxes for you. A tax advisor can guide you in the right direction for handling your taxes and if you just follow these few simple rules for choosing one, you shouldn't have any problems dealing with your taxes!

Your first question may be: what exactly is a tax advisor? A tax advisor isn't the person who actually prepares your taxes—another kind of tax specialist will do that—but what you really use tax advisors for is to minimize the taxes you have to pay. Tax advisors are well versed in tax law and can consequently help you find the loopholes you can utilize to cut your taxes down. Essentially, you use tax advisors to "stick it to the man."

When looking for a tax advisor, keep a special eye out for communication and competence. If your tax advisor is unable to communicate with you what you should do or if you have a hard time understanding exactly what your tax advisor is advising, you should cross that person off your list. Also, if your tax advisor doesn't seem to have any idea what he's doing or if you know that what he's telling you is incorrect, seek tax help elsewhere. You can't jeopardize your money and taxes by allowing someone incompetent to advise you—bad idea! That may seem obvious, but sometimes you just need someone to tell you so.

There are two different types of tax advisors you can look into: a traditional CPA (Certified Public Accountant) or an EA (Enrolled Agent). The CPA may be able to help you with basic taxes and finances, but may or may not know much about tax law; that depends on the area the CPA works in. An Enrolled Agent, on the other hand, is certified by the IRS and is trained specifically in tax matters. During your tax advisor quest, ask questions like "Last year, did I miss any deductions?", "Should I consider tax planning?", "How much do you charge?", and "Can I ask you questions about my taxes throughout the year?". These questions are important when choosing a tax advisor and should all factor into your choice. Also during this interrogation-like process, you can see whether or not you communicate well with the advisor. If not, move on and try someone else.

See, finding a good tax advisor isn't so hard—you just need to put a little work and research in. It's your money and your taxes, so you need to be as picky as you can be!

Author Bio

Charlotte Wood


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