The tax industry is ever changing. Tax professionals are subject to various federal and state regulations. The Internal Revenue Service was sued to stop them from requiring all tax return preparers to take a test to prove their competence to properly apply the tax laws. Enrolled Agents (EAs), Certified Public Accountants (CPAs) and Attorneys have already demonstrated their competence by passing other comprehensive tests. Some in this group of un-enrolled preparers have been writing tax returns for many years. Some are brand new to the tax business. They all were to take a test to demonstrate their knowledge and level of competence. No one could use the designation RTRP, Registered Tax Return Preparer, until they passed this test. The IRS is appealing the lawsuit’s decision. I see nothing wrong with the IRS protecting their tax-paying public (YOU) by ensuring that all tax return preparers show some level of competence. No single person can know everything. There are many areas of specialty within the tax code and ever-growing procedures, regulations and rulings. I help individuals and small business owners. Big corporations and partnerships are outside my area of expertise. Anyone can make a mistake. Yes, we learn from our mistakes, but wouldn’t  you rather that I learn from someone else’s mistake?  The IRS does and they want EAs and CPAs to keep up with the ever-changing tax laws. We do this by taking required annual continuing professional education (CPE). I like the medical doctor’s Hippocratic Oath, “first do no harm.” I follow that in my tax business. I always want to do my best for you. These brief descriptions give you a glimpse of what these professionals can do. An EA, Enrolled Agent, is licensed by the Department of Treasury to represent taxpayers nationwide at all levels of the Internal Revenue Service. A CPA, Certified Public Accountant, is licensed by their State’s Board of Accountancy to perform accounting services in that state. Those same Boards of Accountancy limit the use of the word “accounting” to their recognized CPAs. Some CPAs also practice tax. Some EAs also offer bookkeeping services. Attorneys are admitted to their State’s Bar. Attorneys who are admitted to the Tax Court can represent taxpayers at that level of IRS Appeal. Here are 7 questions you can ask to help ensure you find an experienced, trustworthy tax advisor:

1. How long have you been in the tax business?
2. What licenses or designations do you have?
3. What tax issues do you specialize in?
4. Do you have the knowledge and experience to handle my tax situation?
5. Do you outsource any of your work?
6. What’s your privacy policy?
7. How do you charge your fee; how much will it cost?

It is important that you establish a comfort level with your tax advisor. You want to feel safe (and you want to feel your information is safe) when you share your important and confidential tax return information with your trusted advisor.