Almost every adult needs to file their taxes and, thanks to the complexity of tax laws, people often turn to professional tax preparers to do the work for them. According to the Bureau of Labor Statistics, this career field is expected to grow by 2.9% through 2026. This growth means now is a great time to pursue a career as a tax preparer. Below you can learn more about the skills needed to become a tax preparer, how long it takes to get into the field, the credentials you should earn, and helpful tools and resources to help you along the way.
What Skills Do You Need to Become a Tax Preparer?
Successful tax preparers possess a unique set of skills. While they may not currently be one of your strengths, you can always develop them during your studies and internships. We've listed four common skills that will help you thrive in this career:
Attention to detail
Misplacing a single decimal point or zero can result in significant costs or fees, so possessing an eye for detail is critical in this position; however, everyone makes mistakes sometimes, and most accounting software can catch mistakes. In addition, experienced tax preparers look over tax forms done by entry-level tax preparers to catch any discrepancies.
As a tax preparer, you need to communicate with multiple clients at once. Knowing how to handle several projects during the same day will help you succeed as a tax preparer.
Preparing taxes requires quite a bit of math. Most tax preparation software has built-in tax equations, but being able to compute basic numbers can help you file taxes much more quickly. You can learn most of the math skills you need to prepare taxes during your formal education studies.
Interpersonal communication skills
Tax preparers must frequently communicate with clients. The best tax preparers can communicate clearly and openly with individuals to help them take advantage of as many tax deductions as possible. Honing your interpersonal skills is essential, and can even lead to repeat clients.
How Long Does It Take to Become a Tax Preparer?
Before you can become a tax preparer, you need to map out your career plan. Having a clear direction will help you stay on track during your studies. We've outlined five common steps prospective tax professionals take to embark on their career. Think of these five steps as landmark goals to reach, but also keep in mind that your path may not look identical to the steps below. It's important to be flexible and leave room for potential changes.
Earn your bachelor's degree
Like most well-paying careers, you need to earn a bachelor's degree before you can start working as a tax preparer. Finding the right program to fit your needs is the first step towards earning your degree. Try to select a degree in a field related to finance, such as accounting, statistics, or economics. During your studies, it is a good time to reflect on whether or not you enjoy what you're learning. Don't be afraid to switch to a different major if you feel like your major doesn't ultimately serve your interests. Typically, a bachelor's program takes about four years to complete.
Find an internship
Interning at a tax accounting firm is a great way to learn more about your prospective career. Some firms offer paid internships, while others only offer unpaid; however, you can usually earn school credit for an internship while also gaining on-the-job experience and building relationships with future references. On average, internships last for just one semester. If your employer finds your work satisfactory, they may extend your internship.
Earn your credentials
After acquiring your undergraduate degree, it's time to get your other credentials in order. To prepare federal income taxes, you'll need to apply for an identification number from the IRS. You will also need to pass your tax preparer exam, and some states require you to earn a special license. Your college professors should guide you on where and when to take your required exams. Try to earn your license within two months of graduating.
Obtain a job
Once you get all your requirements in order, you can start applying for tax preparation jobs. Ideally you should apply at least four months before the busy tax season starts in January. This way, you will have time to earn a job and receive adequate training before jumping into your new role. Earning a job can take any number of months, but with patience, flexibility, and hard work, you should be able to get started on your career.
What Education Do You Need to Become a Tax Preparer?
Although earning a bachelor's degree takes time, it is the first -- and one of the most important -- steps towards becoming a tax preparer. However, earning a degree doesn't guarantee you a job. To make yourself a desirable candidate, you may need to acquire more qualifications and enhance your resume with additional experience.
Of course, most employers require a bachelor's degree in a finance-related field, preferably accounting; however, consider this a minimum requirement. Although you can sometimes earn a job at an accounting firm before you obtain your license and identification number from the IRS, most employers favor candidates who already have these credentials.
With rising tuition costs, pursuing an accelerated degree that you can complete in as few as three years can save you significant money in the long run.
While working towards your degree, you can expect to learn the basics of accounting. Common course topics include the legal aspects of tax preparation, managerial accounting, basic business statistics, debtor and creditor rights, tax accounting, data visualization, and auditing.
You can participate in a traditional four-year program, but some schools also offer accelerated programs. With rising tuition costs, pursuing an accelerated degree that you can complete in as few as three years can save you significant money in the long run.
If you need to balance your studies with a demanding career -- or you have personal circumstances that interfere with your ability to attend class in person -- consider enrolling in an online program. Thanks to convenient online learning options, you can complete tests online and still make meaningful connections with peers through online discussion boards.
Tax Preparer Career Development and Credentials
Most tax preparers earn a bachelor's degree, as well as additional credentials and licensing. The most competitive candidates also possess significant work experience. Luckily, you can enhance your qualifications through continuing education opportunities and certifications. We've outlined certification, continuing education, credentials, and licensing opportunities below.
Certifications and Continuing Education
One way to increase your earning potential is to continue your education by earning financial certifications. Certifications require you to study for months -- and sometimes years. You can learn a lot through additional studies, but it also demonstrates to future employers and clients that you have the right credentials to successfully file federal and state taxes.
You can earn a certification in a specific accounting topic depending on what type of clients you want to work with. For example, if you prefer to work with nonprofits to make sure they are providing financial transparency for donors, you can get certified as an auditor.
The certification you should earn depends on the job you secure, so waiting to earn certifications until you earn your first job is a wise decision.
You can also earn certification in business-related areas such as financial planning, charter financial analysis, chartered investment counseling, financial risk managing, and chartered life underwriting. The certification you should earn depends on the job you secure, so waiting to earn certifications until you earn your first job is a wise decision.
Some certifications require you to work at a specific type of firm for several years. For example, if you earn a job at a firm that specializes in investments, you should earn the investment counseling certification. This certification requires you to work at a firm that is a member of the Investment Adviser Association, and acquire at least five years of experience.
Credentials and Licensing
In addition to certification and continuing education opportunities, tax preparers can stand out in a competitive job market by earning additional credentials and licensing. For example, gaining a certified public accountant (CPA) license can set you apart from other accountants and increase your earning potential. To earn a CPA license you need to accumulate 30 hours of accounting-related classes, or you can earn 20 hours of accounting courses at the graduate level.
You can also join professional organizations to enhance your professional knowledge and resume. Many professionals organizations provide helpful advice and learning opportunities for their members. You can also connect with other accounting professionals and learn from them as well.
Learn More about Tax Preparer Careers and Take the Next Step Today
American Finance Association
This organization brings together accounting professionals from all backgrounds. Members can read the organization's popular publication, the Journal of Finance, and submit an article to AFA for publication consideration.
The Professional Accounting Society of America
Every tax preparer needs to be up-to-date on the latest laws that impact accounting. By joining PASA, you can take advantage of exclusive online articles and member-only discounts, and learn from other accountants through networking opportunities.
National Association of Tax Professionals
This organization informs tax preparers about the latest tax law changes. Members also benefit from exclusive discounts on products, and can connect with other professionals through a member directory.
National Society of Accountants
This organization is a resource for tax accountants. The organization provides a tax help desk and a CPA practice advisor subscription. Tax accounting students can also apply for a scholarship from the organization.
National Association of Enrolled Agents
The NAEA brings together federally-licensed tax preparers. To join the organization, you must pass a three-part examination about individual tax returns, business tax returns, and representation. Alternatively, you can have experience as a former IRS employee.