How to Become a Tax Preparer: A Step-by-Step Guide

Becoming a tax preparer can be a rewarding career choice, offering the opportunity to help friends, family and your local community to intelligently manage their finances and navigate the complexities of the complex tax system. Whether you’re looking for a new career path, a new entrepreneurial business or a side job, here’s a comprehensive guide on how to become a tax preparer. Have you ever imagined making 6 figures working just part of the year? It takes a lot of dedication, but guess what? It’s possible and In & Out Tax Services has helped people like you to get there!

What Do You Need to Become a Tax Preparer?

To become a tax preparer, you need to meet certain requirements and develop specific skills:

PTIN (Preparer Tax Identification Number): You must obtain a PTIN from the IRS to legally prepare tax returns. Get started at: https://rpr.irs.gov/ptin. The cost is only $19.75! Your PTIN is yours and it cannot be shared.
Electronic Return Originator (ERO): If you are going for the gold and reaching for a 6 figure income, then you will want to become an ERO. There are greater responsibilities for the ERO, however, the ERO is usually the first point of contact for most taxpayers filing a return and this is the path of many entrepreneurs. Check out details here: https://www.irs.gov/e-file-providers/electronic-return-originator
Education: While a college degree is not required, having a background in accounting, finance, or business can be beneficial. However, if you don’t have that experience, do not fear. High school graduates can also become tax preparers with the right part-time training and mentorship.
Training and Certification: Completing a tax preparation course is essential. Many community colleges and vocational schools offer these courses. You can also find online programs. Online courses may be lower priced and shorter in duration than college courses.
Knowledge of Tax Laws: A thorough understanding of federal and state tax laws is crucial. This includes staying updated with annual tax law changes. Of course continuing education courses are great! Also consider subscribing to the IRS subscriptions: https://www.irs.gov/newsroom/e-news-subscriptions
Software Proficiency: There are many choices for e-file software and you will gain familiarity with one or more as you do business. Platforms like In Out Tax Pro streamline the process and ensure accuracy, for the benefit or your clients.
Ethics and Integrity: Tax preparers must adhere to strict ethical standards to maintain the trust of their clients and comply with legal requirements. We work with people’s most sensitive information, so we must treat that with the utmost care.

How Long Does It Take to Become a Tax Preparer?

The time it takes to become a tax preparer varies based on your background and the path you choose:

Obtaining a PTIN: The process to get your PTIN from the IRS is relatively quick, usually taking about 15 minutes if applying online, and 4-6 weeks if applying using snail mail.
Obtain your EFIN: If you decide to be entrepreneurial and become an ERO, this process takes considerably longer than obtaining a PTIN. Do you have a business and tax ID number? You will need one. Then after filling out the EFIN application online, the background check may take close to 2 months. So prepare and get started early!
Training Programs: Many tax preparation courses can be completed in a few months. These programs often run from a few weeks to a few months, depending on the depth of the curriculum and depending on the format you can put in the time and hard work and finish quicker.
Gaining Experience: Practical experience, either through internships, part-time jobs, or working with a tax preparation service, can not be underestimated. Like in most industries, after the bookwork provides a knowledge foundation, the real learning is in the field, working with those who can teach you. Many tax preparers start to feel more confident after year three.

Steps to Becoming a Tax Preparer

Research and Choose a Training Program: Look for reputable tax preparation courses that fit your schedule and budget. Look at the reviews and remember to pull the trigger, pay the money, and start! Some first-year tax preparers like to get their education late in the year, so they will have fresh knowledge before stepping into their new tax roles in January.
Complete the Course: Learn about tax laws, tax preparation techniques, and the use of tax software. Learn as much as you can and prepare to get out into the real world.
Obtain Your PTIN: Apply for your PTIN through the IRS website.
Gain Experience: Start by working for a tax preparation company or offering services to friends and family. For example, In and Out Tax Services (www.inandouttax.com) offers mentorships. Even if you open your own office, who is there to support you when questions arise, in which you need support? Consider joining an arrangement where you can feel supported.
Stay Updated: Continuously update your knowledge of tax laws and regulations through continuing education. Be the expert! Know your business so you can discuss with anyone at any time. Be confident when you network and bring in new clients!

Additional Tips for Success

- Join Professional Organizations: Consider joining groups like the National Association of Tax Professionals (NATP) or the National Society of Accountants (NSA) for networking and continuing education opportunities. You can join our social media Facebook and Instagram for up-to-date tips and news.
- Join Local Networking Groups: Network, network, network! The business will not come to you, so you need to get your business by establishing new relationships. Consider joining at least one local chamber of commerce and be consistently visible. Other networking groups can also be helpful, like BNI or alignable.com.

Social Media: In addition to promoting yourself on social media, like Facebook and Instagram, also be sure to find group pages that are relevant to your interests and your tax business.

Use Reliable Software: Utilize tax preparation software such as In Out Tax Pro to enhance efficiency and accuracy in your work. If all of the software choices has the same intent, to accurately transmit taxes, how do you make the best decision? Consider the customer support the initial cost, and ongoing costs.
Build a Client Base: Start small, offer excellent service, and rely on word-of-mouth referrals to grow your clientele. The reality is that while taxes may become your chosen craft, you will grow when you are intentional about increasing your business. There are volumes written on this and as an affiliate with In & Out Tax Services, we can save you time and effort by sharing our best practices with you.

Conclusion

Becoming a tax preparer requires dedication, education, and a commitment to helping others. By following these steps and continuously improving your skills, you can build a successful career in tax preparation. Remember to leverage tools like In Out Tax Pro to streamline your work and provide the best service to your clients.

Embark on this journey today, and soon you’ll be guiding clients through the often confusing world of taxes with confidence and expertise, and your personal reward can be great!