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A tax preparer produces and files taxes on behalf of people or businesses. These accounting professionals often maximize tax refunds or minimize tax liability after learning tax code and accounting principles.
They must also be able to keep up with changes in tax law and procedure to communicate complex tax concepts to their clients.
The tax preparer education requirements you need to meet vary, since tax preparer positions encompass both entry-level tax preparers and accountants with years of experience.
What distinguishes the tax preparer's path from other accounting positions is that entry-level tax preparers who plan to file taxes for others must apply for an IRS Preparer Tax Identification Number (PTIN). Once approved, they may prepare federal and state tax returns.
Qualities that make a good tax preparer include being detail-oriented, organized, and able to communicate clearly. If interested in becoming a tax preparer, explore this exciting career path.
Steps to Becoming a Tax Preparer
Complete high school diploma or GED certificate:
Most tax preparers complete a high school diploma or GED certificate to meet the minimum tax preparer education requirements. This step takes about four years to complete, although some students take longer.
Take college courses in accounting, tax preparation, and/or business:
Learners sometimes complete college courses or even a bachelor's degree program to gain additional knowledge and skills in the field. This step often takes two to four years, depending on the program of study.
Enroll in a tax preparer course:
Tax preparer courses provide students the opportunity to learn about the tax code and how to prepare taxes. These programs run for around 10 weeks, and candidates can expect to spend around 20 hours per week on coursework. The courses will cover topics such as tax law, tax preparation, and ethics.
Apply for a PTIN:
The PTIN credential signifies that the Internal Revenue Service (IRS) authorizes the tax preparer to file taxes on the behalf of others. The process to apply only takes a few days to complete. Candidates often complete an online application on the IRS website. Once approved, candidates must earn continuing education requirements every year.
Work as a tax preparer:
Most tax preparers begin their careers employed by a tax preparation firm, although some may find work with accounting firms or other businesses. Many start as seasonal workers, only working during tax season (e.g., January through April). Some firms require tax preparers to work with a particular tax software program, while others provide on-the-job training.
Required Tax Preparer Education
Tax preparers with degrees may be eligible for more job prospects, responsibilities, and salaries than those without. Examples of alternate tax preparer titles include remote tax professional and junior tax professional.
Minimum degree requirements often vary by employer, but skilled tax preparation professionals often hold associate or bachelor's degrees in accounting or a related field.
There are a few degree concentrations tax preparers may consider, including the master of accounting, master of taxation (MTax), or the juris doctor (JD) with a concentration in tax law.
A tax preparer's degree level or specialty area may positively affect their career trajectory. For instance, tax preparers with a JD may work as tax lawyers, while others teach tax courses at the college level.
A candidate with a degree may have a better chance at being promoted into a tax manager or supervisory role. They may even land a job with a larger accounting firm to research tax laws and communicate with clients.
Read about associate degree programs in accounting Read about bachelor's degree programs in accounting Read about master's degree programs in taxation
Required Licensing and Certifications for Tax Preparers
While there is no universal certification requirement for tax preparers, non-credentialed tax preparers planning to sell services must first apply to the IRS for a PTIN to request limited representation rights.
Some states may also have mandatory prerequisites for tax preparers, such as passing an exam or completing a specific number of continuing education (CE) credits.
New York requires tax preparers to register with the state and fulfill annual CE mandates. California requires tax preparers to have an insured preparer bond.
Employers could require certification from a professional organization, such as the National Association of Tax Professionals or the American Institute of Certified Public Accountants (AICPA). Applicants may also need at least an associate degree in accounting or a related field.
Optional Certifications and Degrees
While certifications and degrees for this specialty area are optional, tax preparers often seek these designations to enhance salary and job security. In fact, certain industries (e.g., financial services) may require these certifications to confirm mastery of a specific domain or a commitment to professional development.
There are several voluntary paths for tax preparers when assessing how to become a certified tax preparer.
For unlimited representation rights, the most common are the certified public accountant (CPA), the enrolled agent (EA), and tax attorney professions. The IRS grants limited representation rights to PTIN registrants.
Tax preparers must pass the Uniform CPA Examination, which the AICPA administers.
Tax preparers must also meet education and experience requirements set by their state's board of accountancy. To maintain their license, CPAs must complete continuing education courses every year.
EAs must pass the Special Enrollment Examination the IRS administers. To maintain the EA license, EAs must complete continuing education courses every year.
As a certified tax preparer, the IRS allows tax attorneys to represent taxpayers before tax authorities. The road to a fulfilling tax attorney's career may vary, depending on the candidate's educational background and interests. However, a tax attorney routinely completes an accredited law degree, bar exam, and a specialty tax law program.
Required Experience for a Tax Preparer Accountant
While there is no one specific path to becoming a tax preparer, tax preparers often have experience working with numbers and financial documents, and preparing their own taxes. Some tax preparers have worked previously in accounting or a related field.
Many employers hire candidates with experience in retail sales, administrative work, customer service, or a similar role.
You can find opportunities to learn how to become a tax preparer at accounting firms, tax preparation organizations, and law firms. These roles provide you with the chance to strengthen your technical and people skills.
Junior roles that may qualify applicants include bookkeeper and staff accountant. These roles may require up to two years of experience, but education may be a substitute for experience.
Tax preparation vocational programs and roles offering on-the-job training allow students to learn tax vocabulary and concepts, and network with target employers while gaining practical experience.
Should I Become a Tax Preparer?
When considering how to become a tax preparer, the decision depends on your unique circumstances and goals.
Benefits to consider include earning potential, job satisfaction from helping others, and challenges while working in the field.
A tax preparer may enjoy career progression after taking on more responsibilities and working with a variety of clients. However, there are pain points like long hours during tax season, or having to stay current on tax law changes.
Tax preparer pros include:
Learning to file claims electronically to reduce tax return errors and speed up the tax preparation process.
Access to tax records to make it easier for taxpayers to track tax liability.
Cons may include:
Investing in new software or hardware to electronically file client taxes.
Learning new skills to navigate electronic filing technology.
Setting up new security protocols to access tax records.
Searching for Tax Preparer Jobs
Here are some strategies to use in your job search journey.
- Search for "tax preparer" jobs in the target market using a job board like Indeed or CareerBuilder.
- Check with your state's tax agency to request a list of approved tax preparers.
- Ask family and friends if they know of any tax preparers who are hiring.
- Attend a job fair and speak with tax preparers who are seeking new employees.
- Network with tax professionals to uncover job openings aligned with your skills and experience.
Four top job boards where you can find tax preparer jobs:
- AICPA: gives a list of job openings in finance, accounting, and other specialized roles in the United States to assist career seekers with locating positions advertised by employers, recruiters, and other hiring authorities across the U.S.
- American Accounting Association (AAA): a great resource for those entering the accounting profession. This job board features positions for accountants in academia, practice, and government accounting. The job board also provides resources for accounting educators, students, and professionals on various job search topics.
- iHireAccounting.com: a website that helps businesses recruit qualified finance and accounting professionals, such as tax preparers. It also provides resources for tax preparers to help them locate qualified job leads and become better in their profession.
- Tax Talent: offers a variety of services to support job seekers, including a job agent, salary calculator, continuing education opportunities, and other career resources. The site also has a job board where users can search for open positions in the tax industry.
Read more tips on job searching:
Career Growth Opportunities
Alternate career paths that may emerge include:
Tax analyst: researches and analyzes tax laws, prepares tax returns, and advises clients on tax planning strategies. They may also audit tax returns and investigate suspicious activity.
Tax analysts often have a bachelor's degree in accounting or a related field, and some employers may require certification as a CPA.
Payscale reports the tax analyst's average salary is $60,200 as of October 2022. Salary expectations for tax analysts vary depending on experience, education, and location, but the median annual salary reported by the Bureau of Labor Statistics (BLS) for all accountants and auditors was $77,250 in May 2021.
Tax consultant: advises clients on how to minimize their tax liability. This may involve advising on tax-efficient investment strategies, structuring business transactions in a tax-advantaged manner, or negotiating with the IRS on behalf of a client.
Tax consultants tend to have more education and experience than tax preparers, and can provide more comprehensive advice. Some tax consultants may also be CPAs, which requires passing an exam and meeting other requirements. Base salary averages at $62,610 per Payscale as of September 2022.
Questions About the Tax Preparer Career Path
What degree do you need to become a tax preparer?
There is no specific degree required to become a tax preparer, although many tax preparers have a degree in accounting or a related field. However, tax preparers must complete a formal training program to assist clients effectively.
How long does it take to start a tax preparer career?
It can take anywhere from a few weeks to a few months to start a tax preparer career. The length of time it takes to become a tax preparer can vary depending on your qualifications and experience.
What certifications do you need along the tax preparer career path?
Many tax preparers who intend to prepare and sell tax preparation services start with registering for the PTIN and completing a tax preparer certification program. These programs often cover topics like tax law, tax return preparation, and tax software.
What is the difference between a CPA and a tax preparer?
Tax preparers can also be CPAs. A CPA has met their state's education and experience requirements, including passing the Uniform CPA Examination. A tax preparer helps people and businesses calculate their taxes. They use their knowledge of tax laws to ensure that their clients pay the correct amount of taxes.
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