TAX PREPARATION
What Does a Tax Preparer Do?
Tax preparers prepare, calculate, and file income tax returns on behalf of individuals and businesses. There are several different types of tax preparers. Some have credentials issued by third-party organizations, while others are non-credentialed preparers.
Tax preparers use customer service, financial analysis, data input, and data management skills regularly. Typical duties for these professionals include collecting financial records and preparing individual or business tax returns. Tax preparers update clients’ tax information regularly, analyze past and current financial data, and communicate with clients about upcoming filings and deadlines.
What Is the Average Wage of a Tax Preparer?
As of Nov 1, 2023, the average wage for a tax preparer in North Carolina is $15.21 per hour. The wage for tax preparers ranges between $10.67 per hour and $18.12 per hour in North Carolina.
Hard Skills for Tax Preparers
Knowledge of Tax Law: Tax preparers must understand tax laws and requirements. They prepare tax documents that adhere to these regulations. Understanding tax laws enables tax preparers to find tax credits and exemptions that result in larger returns for their clients.
Tax Return Preparation: Tax preparers complete and submit tax return documents on behalf of their clients. Because every financial situation is unique, tax preparers must apply a variety of tax forms, deductions, and credits to each client’s return.
Computing and Calculating: While tax preparers use software to prepare taxes, filling forms out accurately requires math skills including arithmetic and algebra. These skills allow tax preparers to use the formulas they need to calculate taxes accurately.
Tax Preparation Software: This profession uses computing devices and tax software to improve accuracy and save time while preparing tax returns. Tax preparers should be familiar with tax software and how to use it to input data correctly.
Soft Skills for Tax Preparers
Critical Thinking: Tax preparers use logic and reasoning to analyze financial situations and provide accurate returns for their company, clients, and the IRS. Critical thinking skills help tax preparers determine proper deductions and credits on client tax returns.
Problem-Solving: These professionals identify problems and implement effective solutions during the tax preparation process. They should draw on their knowledge of tax laws and their clients’ financial situations to maximize tax returns and prepare for future tax seasons.
Written and Verbal Communication: Clear, concise written and oral communication is crucial to this profession because tax preparers communicate with clients and the IRS. This includes explaining complex information about tax regulations and processes to people with limited financial and taxation knowledge.
Discretion: Tax preparation involves working with clients’ personal and financial information, including details about their families, employment, and assets. Discussing a client’s financial information for any other reason than tax preparation can result in fines and other penalties.