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How to Find a Good CPA or Tax Preparer

All tax preparers must be registered with the IRS, but they’re not all created equal: experts recognize certified public accounts (CPA), enrolled agents (EA), and attorneys as the most trusted way to go because of the depth of their education and training. Here are a few tips on how to find a good CPA or tax preparer:

Start your search right. With more than 700,000 registered tax preparers with the IRS, narrowing the field can be daunting.

Use your network. Start with recommendations from friends and family. Begin your search through someone you know and trust, suggests the American Institute of Certified Public Accountants, an accounting association that sets ethical standards for the profession
Make the first move. Call to see which tax preparers/CPAs have the experience that matches your needs. A salaried worker with one W-2 may not need the expertise that, say, a new business owner does.
Check out their qualifications. Look for credentials in accountancy and taxation or credentials as a CPA or an enrolled agent (another type of federally-recognized tax preparer). The National Society of Accountants and the American Institute of CPAs each have an online directory of professionals to help get you started.

Get the profile. The Accreditation Council for Accountancy and Taxation has a list of questions people should ask of professional in their search.

Audit experience? Ask if they have experience representing taxpayers before the Internal Revenue Service. Attorneys, enrolled agents, and CPAs are all able to represent you in an audit.
Tax specialty? Just because the tax pro has prepared corporate tax returns, doesn’t necessarily mean he’s done your specific kind. Good questions to ask: What types of clients do you have? Do you have a particular specialty? What’s your expertise?
Fee structure? Some CPAs charge by the hour, some by the types of forms. Others provide a price range that’s dependent on the complexity of your situation. Ask for an engagement letter that outlines the services and anticipated fees.
Availability? Make sure your tax professional is reachable year-round, not just seasonally, in the event that your situation changes or you get a letter from the IRS post-tax season.

Profile the firm. A tax preparer’s firm is like family, and experts say you want to know as much as you can about them as well.

Consider your needs. See which firms have specialties that most closely match your tax prep needs. Take into account any financial or retirement planning services that are important to you.
Dig deep. Research a firm’s track record with the local Better Business Bureau, as well as state boards of accountancy. (Insert your zip code at BBB.org to find your local Better Business Bureau, or click here to contact the board of accountancy in your state.)
Find out how the firm works. Does the tax professional you intend to hire do all the work or does someone else actually do the work?

What not to do. Sure, you may want to get your taxes done quickly and painlessly, but don’t make the following errors in haste:

Don’t commit to contingent fees. A contingent fee is when a tax preparer charges you based on a percentage of your return – and experts say to avoid preparers who offer this. The AICPA says such fees are occasionally ethical for CPAs, but recommends sticking to a structured fee instead.
Don’t procrastinate. Start your search early, not just for a tax preparer but also in pulling your paperwork together. A tax preparer can often provide a tax organizer, which outlines what the tax pro will need to prepare your return. If your pro charges by the hour, being organized may also help you avoid higher fees.
Don’t file blind. By law, a paid tax preparer has to sign your return. But ultimately, you’re responsible for the accuracy of your return, so before you sign off on the tax preparer’s work, review the return and all the forms carefully (See this IRS notice).

For further reading:Mymoney.gov is a financial literacy site by 22 federal entities with information ranging from planning for retirement to scams and fraud.Taxpayer Advocate Service is the taxpayer’s voice at the IRS and, as an independent organization within the IRS, has lots of individual taxpayer information, .

The Accreditation Council for Accountancy and Taxation has a great, expanded list of questions you should ask of a professional in your search. 360taxes.org, by AICPA, has a helpful page devoted to choosing a tax preparer here. And here are details on the new rules that the IRS will begin enforcing on tax preparers.

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AICPA Opposes Legislation to Regulate Tax Preparers

Rather than enact yet another set of rules for professional, credentialed tax return preparers, the AICPA recommends Congress mandate that the IRS enact a testing and continuing education program similar to the registered tax return preparer program in effect prior to Loving [v. IRS] that would apply exclusively to so-called ‘unenrolled’ tax return preparers who are not licensed by the states.”

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EU VAT CHANGES FOR 2015

The measure allows the countries of the EU membership to apply the reverse charge mechanism for a limited period of time with specific conditions also to be taken under consideration. All of this represents a faster procedure..

More specifically, this new directives apply to digital services (everything that can be downloaded or used online)

The area of sectors where this mechanism can be taken to action is broader and it includes also mobile pones, integrated circuit devices, supply of gas and electricity, telecom services, game consoles, tablet PCs and laptops, cereals and industrial crops and raw and semi-finished materials.

As a seller on the market you are responsable to pay the buyers VAT based in their own country (this means any EU country) nevertheless whether you are an EU based company or not. This new directives are not quantitiy and price aware so by selling one ítem for less than a dollar, new legislature will rules are still being applied.

You are also obliged to store buyers information (their location etc.) for the next 10 years after the deal was executed.

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USES OF FINANCIAL REPORTS

Employees need these reports in making collective bargaining agreements with the management, in the case of labor unions or for individuals in discussing their compensation, promotion, and rankings. Prospective investors make use of financial statements to assess the viability of investing in a business. Financial analyses are used by investors and prepared by professionals (financial analysts), thus providing them with the basis for making investment decisions.

Vendors who extend credit to a business require financial statements to assess the creditworthiness of the business.

Government also produces financial reports to stay accountable to the public and people. The rules for recording, measurement and presentation of government financial statements may be different from those required for business and even for non-profit organizations. The requirements for non-profit financial statements differ from those of a for profit institution and therefore, will not be discussed.

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FUNDAMENTAL ACCOUNTING

In order to prepare the financial statements, it is important to adhere to certain fundamental accounting concepts. Going Concern, unless there is evidence to the country, it is assumed that a business will continue to trade normally for the foreseeable future.

Accruals and Matching, revenue earned must be matched against expenditure when it was incurred Prudence, if there are two acceptable accounting procedures choose the one gives the less optimistic view of profitability and asset values. Consistency, similar items should be accorded similar accounting treatments. Entity, a business is an entity distinct from its owners. Money Measurement, accounts only deal with items to which monetary values can be attributed.

Helps existing and potential investors and creditors and other users to assess the amounts, timing, and uncertainty of prospective net cash inflows to the enterprise

Separate Valuation each asset or liability must be valued separately.
Materiality, only items material in amount or in their nature will affect the true and fair view given by a set of accounts. Historical Cost, tTransactions are recorded at the cost when they occurred. Realization, revenue and profits are recognized when realized. Duality, every transaction has two effects.

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SAVE ON TAXES

Under EU law, the standard rate of VAT in any EU state cannot be lower than 15%.Each state may have up to two reduced rates of at least 5% for a restricted list of goods and services. The European Council must approve any temporary reduction of VAT in the public interest.

The default VAT rate is the standard rate, 20% since 4 January 2011. Some goods and services are subject to VAT at a reduced rate of 5% (such as domestic fuel) or 0% (such as most food and children’s clothing).

VAT is an indirect tax because the tax is paid to the government by the seller (the business) rather than the person who ultimately bears the economic burden of the tax (the consumer). Opponents of VAT claim it is a regressive tax because the poorest people spend a higher proportion of their disposable income on VAT than the richest people.Those in favour of VAT claim it is progressive as consumers who spend more pay more VAT.

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ACCOUNTING 1 ON 1

In order to prepare the financial statements, it is important to adhere to certain fundamental accounting concepts. Going Concern, unless there is evidence to the country, it is assumed that a business will continue to trade normally for the foreseeable future.

Accruals and Matching, revenue earned must be matched against expenditure when it was incurred Prudence, if there are two acceptable accounting procedures choose the one gives the less optimistic view of profitability and asset values. Consistency, similar items should be accorded similar accounting treatments. Entity, a business is an entity distinct from its owners. Money Measurement, accounts only deal with items to which monetary values can be attributed.

Helps existing and potential investors and creditors and other users to assess the amounts, timing, and uncertainty of prospective net cash inflows to the enterprise

Separate Valuation each asset or liability must be valued separately.
Materiality, only items material in amount or in their nature will affect the true and fair view given by a set of accounts. Historical Cost, tTransactions are recorded at the cost when they occurred. Realization, revenue and profits are recognized when realized. Duality, every transaction has two effects.

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PROPER INVOICE INFO

Financial statements are prepared according to agreed upon guidelines. In order to understand these guidelines, it helps to understand the objectives of financial reporting. The objectives of financial reporting, as discussed in the Financial Accounting standards Board (FASB) Statement of Financial Accounting Concepts No. 1, are to provide information that

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