By: Accounting.com Staff
Last Updated: December 2019
Tax consultants use their tax expertise to help their clients make educated financial decisions regarding tax-related issues. Tax professionals prepare tax returns, conduct legal research on tax issues, help with estate planning, and ensure that clients meet tax obligations, which often means they enjoy stable, in-demand careers. The Internal Revenue Service (IRS) estimates that 90% of taxpayers seek help with their taxes, with tax professionals preparing 56% of all tax returns each year.
If you've been asking yourself, "what are the job responsibilities of a tax consultant?" keep reading to learn more about the skills, education, and credentials tax consultants need.
What Skills Do You Need to Become a Tax Consultant?
Have you been wondering, "what does a tax consultant do?" The answer is simple: A successful tax consulting career involves building positive client relationships.
Tax consultants attract clients with their social awareness, understanding of customer service, and communication skills. Because tax consultants work with the public, they need to actively listen and ask questions to understand their clients' tax-related needs. Strong speaking and writing skills help accurately communicate information to clients, coworkers, and others.
Working with complex tax information requires an eye for detail and the ability to work with a high degree of accuracy.
Critical thinking and complex problem-solving skills are also important in the tax-consulting industry. When working on complicated tax issues, the best tax consultants use logic to identify solutions to a problem. Success in the tax consulting field also requires superior judgement and decision making, an aptitude for mathematics, and the ability to assess performance and take corrective action. Working with complex tax information requires an eye for detail and the ability to work with a high degree of accuracy.
Tax consultants use personal computers for most of their work, which requires proficiency in Intuit QuickBooks and Microsoft Office suite.
Students can master these competencies by participating in on-the-job training or educational programs. Required skills vary by position, employer, and area of specialization, but the following section covers some general skills and how long it takes to develop them.
How Long Does It Take to Become a Tax Consultant?
The amount of time it takes to become a tax consultant varies depending on what type of education or training you pursue. Tax consulting does not require a specific degree or level of formal education. However, earning a degree in accounting, taxation, or a related field can improve your chances of getting a job. Many employers prefer to hire candidates with a bachelor's degree. Credentialing requirements vary depending on the type of work. Here are a few common steps toward a tax consultant career:
Earn a Bachelor's Degree
Earning a bachelor's degree in accounting, taxation, or a related field typically takes four years studying full time. Some online programs offer accelerated options that let students graduate more quickly. Most CPA programs include additional coursework to meet state requirements and typically take five years to complete. Tax professionals can also consider earning a master's degree to make their resumes more competitive.
Not all tax consultants need to earn credentials. However, anyone who prepares a tax return for clients must get a Preparer Tax Identification Number (PTIN) from the IRS. Most credentials take a few months to receive once the applicant meets all requirements. Make sure to consider processing when estimating how long it will take to receive your credential.
Tax professionals who work as CPAs or enrolled agents (EA) must earn specific credentials. CPAs need a license from their state boards of accountancy, which requires passing the CPA exam. EAs must register with the IRS and pass a three-part special enrollment exam and a background check.
Land an Entry-Level Job
The time it takes to receive your first job offer in tax consulting varies. Factors that can influence how long it takes include the number of available jobs in your area, your networking connections, and your qualifications compared to those of other candidates. In some cases, it might take several months before you start working your first job as a tax consultant.
Enroll in Continuing Education Classes
CPAs and EAs both need to complete continuing education credits to maintain their credentials. The number of required continuing education credits for CPAs varies by state. EAs must complete 72 continuing education hours every three years. Even tax professionals who work in positions that do not require continuing education should take advantage of opportunities to learn new skills and stay current on new developments in the field.
What Education Do You Need to Become a Tax Consultant?
No degree or education can guarantee a career, but completing some formal education in a tax-related field can improve your chances of landing a job.
The tax consulting profession does not include any specific educational requirements. Anyone can become a tax consultant, tax preparer, or enrolled agent and offer tax consulting services without holding a specific degree. However, to succeed, tax consultants need a foundational understanding of accounting theory and practice, taxation, personal finance, and federal and state tax laws. They can gain some of this knowledge through on-the-job training and experience.
Employers often prefer tax consultants who hold at least a bachelor's degree.
Although not required, many tax consultants earn bachelor's degrees in accounting or finance. Many tax consultants hold a Certified Public Accountant (CPA) credential, which requires an accredited bachelor's degree. CPAs must also pass the CPA exam before they can practice accounting. Most states require CPAs to complete advanced coursework beyond the bachelor's level, and many CPAs earn master's degrees. Employers often prefer tax consultants who hold at least a bachelor's degree.
Tax consultants who specialize in areas like international tax or corporate tax typically complete specialized education or training to gain expertise in a narrow subfield of tax law. Registering for professional development and continuing education opportunities allows tax professionals to keep their skills relevant and gain new knowledge over the years.
Tax Consultant Career Development and Credentials
Professionals in the tax consulting field can take advantage of career development education to stay up-to-date on changing tax rules and regulations. Tax consultants can also pursue credentials and licenses to demonstrate their knowledge to prospective employers.
Certifications and Continuing Education
The industry does not require tax consultants to hold certifications or complete continuing education classes to qualify for positions. Rather, certifications and continuing education classes provide optional opportunities for tax professionals to enhance their careers and earning power.
Professional organizations like the National Society of Tax Preparers, the National Association of Tax Preparers, and the National Society of Accountants offer continuing education and professional development opportunities to members. Tax consultants take classes that explore topics like growing a tax consulting practice, introduction to tax preparation, and updates on federal tax laws. Most organizations offer live and on-demand webinars, online trainings, self-study, and in-person events.
Tax consultants who work as CPAs or EAs typically need to complete professional continuing education credits to maintain their licenses.
Credentials and Licensing
Tax consultants can usually provide their services without holding any official credentials or licenses. However, some specific job titles do require licensure. CPAs must hold licenses from their state accountancy boards to practice public accounting. Each state sets its own CPA requirements, but all require applicants to pass the CPA exam.
EAs must register with the IRS, which typically requires passing the EA exam and a criminal background check. EAs and CPAs must satisfy continuing education requirements to keep their credentials valid. Also, tax consultants who want to prepare tax returns for others must get a PTIN from the IRS.
Learn More about Tax Consultant Careers and Take the Next Step Today
National Society of Tax Professionals
Founded in 1985 as a nonprofit organization, NSTP represents tax professionals in the U.S. The organization offers continuing education workshops and other events, a blog, and a classified section with tax-related job postings.
National Association of Tax Preparers
Members who join NATP gain access to continuing education, a community for networking opportunities, and tools and informational resources. NATP's membership includes 23,000 tax professionals.
National Association of Enrolled Agents
NAEA represents enrolled agents. The EA credential is the highest license the IRS awards. NAEA provides networking and continuing education opportunities for EAs.
National Society of Accountants
NSA advocates for accounting and tax professionals. It offers publications through its knowledge center, plus member discounts and networking opportunities.