As your business and wealth grow, you might realize that it is becoming tough for you to keep up and account for all your tax returns. It might be due to several different reasons, such as increasing duties and meetings or rapid expansion stretching your accounting team. That is where a tax preparation service provider comes in for your company.
What is a Tax Preparation Service?
A tax preparation service is a firm that conducts tax calculation, accounting, and filing of income tax on behalf of a client, business, or organization. There are different types of tax preparation companies depending on their certifications and credentials. It is important to know the different types to ensure that you get the right fit for your business or organization.
Different Types of Tax Preparation Services
There are different types of tax preparation service providers, and different tax preparation companies hire them according to the needs of their clients. The different types of tax preparation service providers are:
1. Certified Public Accountants (CPA)
As the name implies, this type of tax preparer is certified by an authority such as the state or federal government. And to attain this certificate, they go to an accounting school or undertake an accounting course to achieve the necessary skills to work as a certified accountant. They then have to undertake and pass the standard Uniform Certified Public Accountant examination. The American Institute of Certified Public Accountants offers this examination as an industrial standard for all accountants. The main duties, including CPA personnel, are:
- Maintaining and updating financial records
- Creating and certifying financial statements
- Conducting auditing services
- Preparing and filing taxes
2. Tax Attorneys
Tax attorneys are lawyers who are specialized in business and tax law and offer tax advisory and tax case defense services for their clients. The main duties of tax attorneys are offering in-depth knowledge and advice to companies and individuals on different tax laws and the legal aspects of the client’s taxes. They can also assist you through tax preparation and filing and representation before the IRS on matters to do with taxes.
For an attorney to qualify as a tax lawyer, they have to:
- Enroll and graduate from a college with a college degree
- Enroll and graduate from a law school with a law degree
- Pass the required state bar examination
It is also advisable for tax attorneys to continue with their education in their careers to stay in touch with the ever-changing tax laws. That way, they will offer better tax preparation services.
3. Enrolled Agents (EA)
Enrolled Agents are the sole individuals with a license from the IRS that gives them the power to represent clients and companies before the IRS. They can also come in handy during tax preparation because they have a deep understanding of how the tax laws work.
EAs receive their certifications as:
- Passing the IRS’ Special Enrollment Examination
- Or if they are former employees of the IRS and they have achieved the required work experience.
Tax preparation agencies, such as Accord CPA, hire one type or a mixture of these individuals to help them cover all the areas required by their clients.
Final Thoughts On Top Tax Preparation Services For Businesses
A tax preparation service will almost always come in handy for your growing business or wealth. They will save you from getting in trouble with the IRS, which might cost you your entire business. It is important to research the tax preparation service to determine if it is the best fit for you before hiring one. When it comes to tax time, you don’t want to mess around. Stay on the good side of the Internal Revenue Service always with an experienced accountant!