You Better Shop Around: Finding The Right Tax Pro For Every Occasion

Posted by msmessenger on Feb 14, 2023 12:00:00 AM

When it comes to seeking advice or preparing the self-storage operation’s tax returns, the complex, ever-changing tax rules make doing it without help extremely risky. While off-the-shelf software or more expensive custom software are frequently used, professional help is almost a necessity.

Most self-storage owners, operators, managers, and developers use a professional at some point, commonly to prepare tax returns. In fact, according to the IRS, more than half of all returns filed were filed by tax professionals. For those without professional help, or those seeking to change tax professionals, finding a professional should be more than a search for the least expensive or most convenient. There are considerations such as compatibility, industry knowledge, experience, and qualification. The first question is what kind of tax professional is required?

Kinds Of Tax Professionals

When it comes to help with tax preparation or tax questions, the Internal Revenue Service (IRS) offers free advice, but it is free advice at a price and often difficult to obtain. The IRS will not advocate aggressive tax solutions, nor can their answers be taken as gospel. In fact, the IRS will not stand behind incorrect advice or even its erroneous interpretation of its own rules.

While anyone can be a paid tax return preparer, as long as they have an IRS Preparer Tax Identification Number (PTIN), remember that there are various types of tax return preparers with differing levels of skills, education, and expertise.

Bookkeepers are great for the day-to-day recordkeeping of a business. Accountants, on the other hand, usually crunch the numbers the bookkeeper tracks, translating (even evaluating) those figures into a format understandable and usable by the average business owner, shareholder, or manager. When dealing with an accountant, don’t underestimate the importance of a Certified Public Accountant (CPA).

Passing the CPA examination is frequently a guarantee of a certain level of abilities. Most states require CPAs to have at least a college degree or its equivalent. Many, in fact, require post-graduate work.

While many CPAs do advise and prepare returns, keep in mind that the CPA designation does not require a special knowledge of our tax laws. Although CPAs and attorneys are permitted to practice before the IRS and the tax courts, another group of professionals, enrolled agents (EAs), must demonstrate their knowledge of taxes in order to represent taxpayers in those venues.

The EA has successfully completed a three-day test that is all about taxes. The IRS requires a certain level of competence, adherence to rigid professional standards as well as relying on continuing professional education to maintain those skill levels. And it is the IRS, not a local association of professionals, that tests, monitors, and polices the EA.

Generally, the experts suggest that it is best to find a professional focusing on clients that mirror your situation. Smaller tax return preparers and national chains such as H&R Block tend to focus on individuals, professionals, and smaller-sized businesses. Medium-sized CPA firms usually specialize in mid- to large-scale regional businesses and high-income individuals. National CPA firms are geared to servicing very large companies and their top employees.

Typically, attorneys specializing in tax law are not ardent disciples of tax return preparation. Such legal professionals are most often confined to complex transaction issues and document preparation. Also keep in mind that non-legal tax professionals are afforded some degree of client confidentiality. For issues requiring absolute confidentiality, consider the use of attorneys who enjoy legal extremes of data protection.

Professional Associations
The best way to find someone to prepare the operation’s tax returns or to render needed tax advice is to get a referral from business associates, the business’ banker, or an attorney. If more possibilities are needed, most states have branches of professional associations, including organizations such as:

  • American Academy of Attorney-CPAs (AAA-CPA) – The only organization made up of individuals who are dually-qualified as attorneys and as Certified Public Accountants (CPAs).
  • American Institute of Certified Public Accountants (AICPA) – The world’s largest member association representing the accounting profession.
  • National Association of Enrolled Agents (NAEA) – A professional society representing enrolled agents (EAs), America’s “tax experts.” EAs earn their licenses from the U.S. Treasury Department by passing a three-part examination administered by the IRS and are required to complete annual continuing education requirements that exceed the IRS’s required minimum and adhere to a stringent code of ethics.
  • National Association of Tax Professionals (NATP) – Claims to be the largest nonprofit organization with members of all 50 states focusing specifically on federal tax preparation. NATP claims its members adhere to a superior standard of professional conduct and bring excellence to the more than 12 million taxpayers they assist worldwide.
  • National Conference of CPA Practitioners (NCPAP) – Another professional organization that claims to represent over one million business and individual clients. NCCPA monitors and influences tax administration and tax policy by meeting with IRS representatives and state taxing authorities as well as national and state elected officials.
  • National Society of Accountants (NSA) – Along with its state affiliates, NSA represents independent practitioners who provide accounting, tax, auditing, financial and estate planning, and management services to 19 million individuals and businesses. NSA members are required to pursue continuing professional education to stay current on tax laws and skilled in client service areas. It also has a strict code of ethics that all NSA members must follow.
  • National Society of Tax Professionals (NSTP) – Professes to assisting its members attain the greatest expertise, proficiency, and competency is all areas of tax compliance while preparing its members to be qualified to effectively provide professional tax preparation services for their clients.

Tax Tidbits

Remember: The professional used for tax advice need not be the same used for preparing the self-storage operation’s tax returns.

It should go without saying that checking a prospective tax professional’s or preparer’s qualifications, along with his or her history, is imperative. Asking the right questions, often during the free initial conference offered by most professionals, can help assess not only the needs of the business but also determine whether the professional will be a good fit for the business.

While few organizations will provide reviews of their members, the IRS’s Directory of Federal Tax Return Preparers with Credentials and Select Qualifications can often help in the search for professional tax help. The information contained in this directory is all that is publicly available, and there are many other valid tax return preparers who have a current year preparer tax identification number from the IRS who are not listed (

Tax return preparer fraud is among the list of common tax scams. The IRS provides tips on avoiding unscrupulous tax return preparers and investigates paid  tax return preparers who act improperly.

However, any self-storage owner, operator, manager, or developer who has been financially impacted by a tax return preparer’s misconduct or improper tax preparation practices can make a formal complaint. To report abusive tax return preparers or suspected tax fraud, the IRS’s Form 14157, Return Preparer Complaint and Form 14157-A, Tax Return Preparer Fraud or Misconduct Affidavit, are used by individuals, sole proprietors, and single-member LLCs to report a tax preparer’s misconduct.

Although these tax preparer complaint forms don’t let anyone off the hook for paying taxes owed, they allow every individual, sole proprietor, and single-member LLC to annymously report tax preparer misconduct.

Since business (and life) happens year-round, not just at tax time, year-round access to the tax professional for needed guidance and advice is almost essential. If any problems arise with the tax return, the professional should be able to address them. If there is an IRS audit, the professional should be available and able to guide the self-storage owner, operator, manager, and developer through the process.

An important step to finding the right professional requires an inventory of what the self-storage business actually needs in the way of services and advice and, most importantly, how much you can afford to pay for that advice or services. It is important to determine beforehand just how much of the work you and the operation’s employees will do and how much of it will be done by the professional or professionals.

Shopping for a professional is virtually a necessity in today’s business economy. Fortunately, many professionals offer free first meetings for discussion of expectations, services needed and provided, extent of involvement by the professional and the portion of the work the operation’s employees expects to shoulder, time constraints, and, above all, costs. It is not “tacky” to discuss fees before engaging the services of a professional, although money should not be the sole criteria for selecting that professional.

Comparison shopping to find a tax professional who can provide the level of service you require at a price that the business (and you) can afford is a process that should begin immediately. Just keep in mind that once you sign that tax return, you become responsible for everything on it, even if someone else prepared it.