Can a Tax Preparer Have a Criminal Background?

According to the IRS, more than 60 percent of taxpayers pay someone else to prepare their taxes. Some of them do so because they really don't understand how taxes work and others to avoid the hassle and paperwork. However, choosing someone to prepare your taxes for you is no light task, and certain factors, such as criminal background, should play a part in the decision.

Tax Preparer

A tax preparer is anyone who fills out the paperwork and performs the tax calculations for another person. He can be paid or unpaid. Both the taxpayer and the preparer sign the bottom of the tax return paperwork, The information a tax preparer uses to prepare your returns comes from you, and you are ultimately responsible for what appears in your tax return.

Registered Tax Preparers

Anyone can be an unpaid tax preparer, but the IRS requires paid tax preparers to register for a Preparer Tax Identification Number (PTIN). The PTIN program is an effort to regulate those who can present themselves as professional tax preparers. The PTIN registration cost is $64.25, as of 2011, and requires credentials and continuing education requirements in much the same way states regulate insurance and real estate professionals.

Exclusions for Criminal Backgrounds

If your tax preparer doesn't require payment, such as a family member or friend doing you a favor, a criminal background doesn't matter. If you're going to a professional preparer, she must have a PTIN. To get one, she must disclose and provide an explanation for any felonies she was convicted of in the past 10 years. The IRS determines whether a felony conviction disqualifies a preparer from a PTIN on a case-by-case basis.

Considerations

Even if a tax preparer can technically have a criminal background, you should probably steer clear of those who do. You are responsible for everything that appears in your tax return, so the IRS advises against using anyone to prepare your taxes who has had a brush with the law. It also advises against using preparers who charge based on a percentage of your refund or one who refuses to sign the tax return as the preparer.

references