Tax Preparers prepare income tax return forms for individuals and small businesses. Some Tax Preparers are automating their tasks through the use of personal computers and off-the-shelf tax software packages.

JOB DUTIES

Tax Preparers may:

Review financial records, such as prior tax return forms, income statements and documentation of expenditures to determine forms needed to prepare each return

Interview clients to obtain additional information about taxable income, deductible expenses and allowances

Compute taxes owed

Complete entries on forms, following tax form instructions and tax tables

Consult tax law handbooks or bulletins to determine the procedure for preparing unusual returns

Calculate the form preparation fee according to the complexity of the return and the amount of time required to prepare it

Tax Preparers may occasionally verify totals on forms prepared by coworkers to detect errors.

Some Tax Preparers may offer tax planning services, including advice on the advantages and disadvantages of certain business, investment and personal transactions. They may also provide bookkeeping services.

The tools and equipment used may include:

OCCUPATIONAL SPECIALTIES

Tax Preparers may specialize in these areas:

219.362-070 TAX PREPARERS prepare income tax return forms for individuals and small businesses. Tax Return Checkers are generally experienced Tax Preparers employed by very large chain or franchise operations to verify the arithmetical and procedural work of Tax Preparers. They either correct errors found in returns or send them to the original preparers for correction. Enrolled Agents are Tax Preparers who, like certified public accountants (CPA's) and attorneys, are licensed to speak on their clients' behalf at all administrative levels in the internal revenue service's (IRS) tax return audit process. Tax Preparers who are not licensed may represent tax payers only at the local IRS agent level.

In addition to learning about these specialties, you may also find it helpful to explore the following MOIScripts:

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Tax Preparers may work alone in small businesses or with other Preparers in large firms. Many Tax Preparers are self-employed. Some Tax Preparers work in offices that are comfortable, well lighted, and well ventilated. Others work in clients' offices or homes where working conditions vary from job to job.

Tax Preparers practice year-round, providing a variety of services to clients. Most Preparers, however, perform the majority of their work during the period from January through mid-April. Preparers employed by large firms for seasonal work only, usually work a predetermined number of hours, which most often range from 20 to 40 hours per week. Overtime is quite common during the peak tax preparation period. Self-employed Preparers set their own hours, based on their workload and appointments made with clients

Some Tax Preparers either lease or buy automated tax preparation equipment, software, computer forms, and supplies.

Tax Preparers may belong to various professional organizations which represent professional Preparers if they meet certain educational or licensure requirements. Two of these organizations are the National Society of Public Accountants and the National Association of Enrolled Agents. Members of these associations must pay periodic dues.

You Should Prefer:

• Performing activities which require special processes or methods

• Working with numbers

You Should Be Able To:

• Use reason and logic

• Communicate well, both orally and in writing

• See details/errors in computation/punctuation within numerical data

• Plan and control an entire activity

• Perform mathematical operations quickly and accurately

• Work within precise limits or standards of accuracy

• Get along with clients

• Rate information using personal judgement and measurable standards

Math Problem You Should Be Able to Solve:

If a customer owes $200 to the Federal government, he or she receives $50 from the state government and $20 from the local government, what is his or her net gain or loss?

Reading Example You Should Be Able to Read and Comprehend:

Income taxes are the second most important source of state revenue. Individuals in most states are required to pay a percentage of their income to the stated in taxes.

Writing Example You Should Be Able to Produce:

You should be able to write a report explaining a customers tax situation.

Thinking Skill You Should Be Able to Demonstrate:

You should be able to look at a customers tax situation and decide if the paperwork is correct and ready to be sent in.

Tax Preparers may become "Enrolled Agents" after successfully completing an Internal Revenue Service written examination on federal taxation, meeting character qualifications, and passing a background investigation by the U.S. Department of Treasury. Successful candidates may use the phrase "Enrolled to represent taxpayers before the IRS" to describe themselves. Although several states have enacted laws to license and regulate tax return Preparers, no state or national law covers Preparers in Michigan . However, in all states, there are penalties against Preparers for negligence and misconduct under the tax reform Act of 1976, the Tax Equity and Fiscal Responsibility Act of 1982, and the Tax Revenue Act of 1986.

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EDUCATION AND PREPARATION OPPORTUNITIES

NOTE: On-The-Job Training provided by the employer or a High School Diploma or Equivalent or a High School Diploma with specific Vocational Education Classes or an Associate Degree (two years of study beyond High School) may qualify a person for this occupation.

The following education and preparation opportunities are helpful in preparing for occupations in the MOIScript:

***SCHOOL SUBJECTS***

0600 BUSINESS , 0700 CAREERS , 0900 COMMUNICATIONS , 1000 COMPUTERS , 1100 ECONOMICS , 2200 MATH , 3300 TECHNOLOGY

***VOCATIONAL EDUCATION PROGRAMS***

005 ACCOUNTING & COMPUTING

Approved programs in Accounting and Computing prepare students to compute, calculate, and record numbers to keep financial records. Instruction includes using billing machines, bookkeeping machines, and computers to prepare bills and reports, obtain records and find information.

High school students should consult their guidance office for more information about the specific requirements of this program at their school or area vocational education center.

***POSTSECONDARY PROGRAMS***

There are no Postsecondary Programs related to this MOIScript

Search for a College and/or Instructional Program

***APPRENTICESHIP OPPORTUNITIES***

There are no Apprenticeships related to this MOIScript

***MILITARY TRAINING PROGRAMS***

There are no Military Programs related to this MOIScript

E-Learning Courses and Programs

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OPPORTUNITIES FOR EXPERIENCE AND METHODS OF ENTRY

Secondary vocational education programs in accounting and computing may offer related experience in this field. It is possible to explore or gain experience through educational programs and seminars offered by large chain tax preparation firms, adult education centers, colleges and universities, and professional associations. Volunteer experience through churches, charitable organizations, and government agencies may offer opportunities.

School-to-Work opportunities include:

informal apprenticeships

mentorships

job shadowing experiences

touring a local Tax Preparer employer

internships

volunteer work with a Tax Preparer employer

community service work with an agency

The most common method of entry is direct application to employers. Also, Tax Preparers may begin immediately to solicit their own business clients after acquiring training. Several large tax preparation firms routinely offer employment to the most promising graduates of their free or low cost tax-training programs.  In addition, you should access and search the Internet's on-line employment services sites such as:

Michigan Talent Bank

America's Job Bank

Classifieds Employment

Yahoo! Careers

MONSTER.COM

You should also enter an electronic resume on these on-line services.

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EARNINGS AND ADVANCEMENT

Earnings of Tax Preparers vary, in most cases, according to the fees charged for completing tax returns. Some Tax Preparers, however, earn salaries which are independent of fees received for individual returns. Generally, fees charged rise with increases in the number of Tax Preparers employed by a firm, the gross income of the firm, the number of years in practice, the size of the metropolitan area served, and the complexity of the return prepared. Nationally, Tax Preparers employed by large chain tax preparation firms generally are paid on a commission basis and receive a percentage of the fees charged for each return. New Tax Preparers often start at a commission of 10% of fees collected and may receive a weekly "draw" (salary) against their future commission earnings. The commission paid usually increases each year that a Preparer works for a company.

Tax Preparers who offer year-round financial advice can charge higher fees. Those who simply do tax forms during "tax season" may charge lower fees.

Preparers' fees at one large tax-preparation chain started at $30 per return (short form) and $58 per return (itemized form) in early 1996. Tax return fees can range up to $1,000 and more for the more complex returns prepared at some accounting firms (1996).

At other types of firms, Tax Preparers had the following average annual earnings (1995):

The net earnings of self-employed Preparers depend on the number of years in practice, the size of the metropolitan area serviced, the complexity of the returns prepared, the size of their clientele, the gross income of their business and the amount of overhead their business requires. Tax Preparers in Michigan had comparable earnings.

Some salaried Tax Preparers receive benefits such as group life, health, and accident insurance. Self-employed Preparers must pay for all benefits themselves.

Experience and the ability to perform more responsible work are the most important factors affecting advancement. With successful completion of the necessary educational and licensing requirements, a Tax Preparer may advance to positions of Enrolled Agent, Certified Public Accountant, or Tax Attorney. Preparers may have own business.

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EMPLOYMENT AND OUTLOOK

Nationally, the number of Tax Preparers is unknown. The employment of Tax Preparers is expected to increase faster than the average for all occupations through the year 2005 because of the constantly changing tax laws and the growing complexity of businesses.

There are approximately 1,600 Tax Preparers employed in Michigan . Many of the Tax Preparers were employed by accounting, auditing, and bookkeeping services firms. Many other individuals worked as Tax Preparers in unincorporated sole proprietorships or partnerships or as volunteers for non-profit organizations.

Employment of Tax Preparers in Michigan is projected to increase faster than the average for all occupations through the year 2005. An average of 60 openings for full-time Preparers per year is expected, with 30 due to growth and 30 due to replacement of workers who retire or leave the labor force for some other reason. Additional openings will occur for part-time or seasonal Tax Preparers, as well as to replace full-time Tax Preparers who change jobs or occupations. The extremely rapid expansion of the scope, complexity, and impact of tax law has considerably increased the demand for skilled tax professionals. The U.S. Treasury Department estimates that over 40% of all tax returns are currently prepared by paid professionals.

MICHIGAN 'S EMPLOYMENT OUTLOOK TO 2005

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Printed Occupational information is available upon written request from the sources below.

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  MOISCRIPTS are Copyright 2003, Michigan Department of Career Development