Can I Trust the Accuracy of Online Tax Preparation Programs?

Online Tax Preparation Programs
  • You’re considering using online tax preparation programs. What should you know before you go down that road?

    If you’re thinking about using online tax preparation, be selective and choose carefully. Some less-than-ethical companies recognize taxpayers as easy prey. They can and will take advantage of their own clients. Remember, only you are accountable for your tax return, regardless of who prepares it.

    There are two types of online tax preparation. You can hire an online company or individual to prepare your tax returns for you. The other option is to use software that takes you through the process step by step.

    Is it Safe to Use Companies Who Offer Tax Preparation Online?

    You can find tax preparation companies online who are reputable, trustworthy and qualified to help you file your income tax returns. These companies can provide you with accurate tax preparation. But some other businesses are not reputable; you cannot and should not trust them. So you must be careful and do your research. Here are some questions to consider:

    • What are their credentials? Be aware that the only ones who can represent you in tax-related matters are lawyers, CPAs and EAs (Enrolled Agents). Many big tax preparation companies have very few licensed preparers.
    • Will they be accessible for you to contact after tax season? Huge numbers of tax preparers are out of work after the filing season ends.
    • What’s their track record? Check for issues with the Better Business Bureau. Next, check license status and look for any disciplinary problems. Find the state board for lawyers in your state and the board of accountancy for CPAs. Check Enrolled Agents on the IRS Office of Professional Responsibility website.

    How Accurate is the Tax Preparation Software Online?

    Do you need a tax professional at all? The short answer is “yes,” for several reasons. Yes, several software applications take you step by step through the process of preparing and filing your tax forms. They may be accurate, but they can wind up costing you money in deductions not taken or credits given in error.  

    Don’t try it on your own unless you’re knowledgeable about tax laws, credits and deductions and the tax code. You could end up with only a fraction of the money you’re due. Many times, choosing a knowledgeable professional can cost less than doing it yourself. It would only take them finding one credit or deduction you may have missed.

    Going Online to Find Tax Preparation Professionals

    Most people don’t have the time or patience to wade through all the information about tax laws and codes. Laws and codes change all the time. They are complex to read and difficult to understand.

    Hiring a licensed tax professional gives you peace of mind. You know your tax returns are accurate. If the IRS questions something on your return, you also know that your tax professional will be there to help you address any concerns.

    Find a qualified tax professional who’s a good fit for you and your circumstances. That way you’ll be able to trust the accuracy of their online tax preparation for you.

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