Industry Tips
Tax Preparers
According to the IRS, an income tax preparer is any person who receives compensation for the preparation of all or a substantial portion of any return of tax for another individual. Before you choose an income tax preparer, you need to decide what type of services you need, and how much you can afford to pay. The IRS has developed a strict set of rules and regulations that a tax preparer must follow. Remember that ultimately you are responsible for the tax return you file. Be honest with your tax preparer. A preparer will not act as an auditor; he or she will not necessarily ask to see all your documents or request proof of the figures you give. With the help of the right tax preparer, the forms can be processed quickly and successfully.
Quick/Rapid Tax Refunds
Tax preparation companies which offer income tax refunds in a few days are actually offering to let you apply for a loan, called a refund anticipation loan or RAL. To do this, you must have your tax return filed electronically. There may be fees charged in connection with the loan, in addition to fees for filing the return electronically. If you have your tax return prepared by a professional at the company which electronically files your return, there may also be fees for preparing the return. If the loan is for the entire amount of the tax refund, you will have to pay additional money. Understand that this is a loan only and, like any other loan, may ultimately be denied. Understand also that processing your loan could take longer than anticipated.
You do not have to apply for an RAL in order to have your tax return filed electronically. After the IRS receives your electronically filed return, a refund can be issued by mail within 3 weeks. Be sure to read all information carefully. Find out exactly what fees you will have to pay, and when you will have to pay these fees. Also find out when you will know if the loan has actually been approved, and, once the loan has been approved, when you will receive the money. Also be sure to carefully read any loan application or agreement before you sign it, and always request a copy for your records.
