One of my biggest complaints is about fake tax preparers.  They’re all over the place.  They magically appear during tax season and then disappear on or before April 15th.  When the IRS letters start showing up, they’re nowhere to be found and their victims wind up paying me (and people like me) lots of money to get them out of the jam they’re in.

 

For example:  One year I had to assist five different people who received audit letters and all of them had had their returns prepared by the same woman.  Besides the fact that all the tax returns were wrong—the thing they had in common was that all of them said they had been “self-prepared,” even though all five of the people who came to me stated that this woman had prepared their returns and that they each had paid her $200 for the service.  I’ll never know how many bad returns that person did—but if five of them walked through my door, I‘m guessing that there were a whole lot more.

 

So how do you know you’ve got a lemon preparer?  The best way to know is to see if he or she has something called a PTIN number.  (PTIN stands for Preparer Tax Identification Number.)  A real preparer signs her name on your tax return and puts her PTIN number on it.  A fake preparer does not sign your return and your return will say “self-prepared.”

 

Most folks don’t know that professionals are required to have PTINs.   Unless you were burned by a bad preparer in the past, it’s not something that would ever be on your radar.  It’s on my radar because I have to tell people they’ve been burned on a regular basis.  It’s never a fun conversation.

 

So how do you know if you’ve got a real tax professional instead of a fake?  Well now there’s a directory and you can look your tax preparer up.  All you have to do is go to:  http://www.ptindirectory.com/

 

You can type in your preparer’s name and if they’ve got a PTIN, you can find them there.  For example:  my last name is Roberg and I work in Missouri.  If you wanted to check my credentials, you’d go to the site and type those in and I’d be there.

 

Or say you don’t have a tax preparer and you’re looking for someone.  You can go to the website and type in your zip code and it will give you a whole list of preparers in your area.  For example, I work in the 63146 zip code area.  If you type that in, well of course I’m on that list, but so are a whole bunch of other tax folks who work in my area as well.

 

Click on a name and it will give you the person’s credentials and business address.  EA means enrolled agent (that’s what I am.)  EAs are licensed by the Department of Treasury to represent clients before the IRS.  CPAs are Certified Public Accountants and RTRPs are Registered Tax Return Preparers.  RTRP is the new tax professional designation, it means the person has passed a test demonstrating competency is basic tax return preparation.  Persons with PTINs but no credentials will just have their names listed.

 

Will hiring a professional with a PTIN prevent you from ever getting audited?  No, I can’t promise that.  But it does show that you’ve hired a professional who’s serious about obeying the law, and that’s something you want in your tax preparer.