When it comes to filing your income tax forms, you want things done correctly. But many individuals and business owners also need to try to save money where they can. In an effort to achieve both of these goals, you may find yourself wondering whom you should hire to file your taxes. How can you get the right level of service without overpaying or risking your own financial future?

Here's what you need to know about the most common choices for tax preparation and what they can or cannot do for you.

1. Unenrolled Tax Preparer

In many states, including Washington, tax preparers aren't certified as to their competence. This means that just about anyone can offer paid tax preparation services. Known by the IRS as unenrolled tax preparers, these members of the public can sign returns but have very limited status before the IRS. They may not be able to represent any taxpayer or business in audits or meetings. 

Most businesses and higher-earning individuals need a more highly skilled tax preparer to ensure they don't overpay on taxes. While unenrolled preparers are the cheapest option, you may get only a little assistance. 

2. Bookkeeper

If your small business already works with a bookkeeper, you may want to just have them file the taxes. Unfortunately, a bookkeeper is unlikely to be trained specifically in tax issues. And for all their accounting knowledge, they are an unenrolled preparer and cannot represent you or your company before the IRS.

A bookkeeper could be an important part of your tax team, though. By keeping your books all year long, they help prepare the documents, gather the numbers, and track expenses needed to later prepare the taxes. 

3. Enrolled Agent

Most taxpayers haven't heard of an enrolled agent, but they can be a good resource for some people. Enrolled agents pass a three-part IRS exam in order to earn their enrollment and must also complete annual continuing education in tax issues and ethics. Like CPAs, they can represent the taxpayer (business or individual) during much of the IRS' process. 

An enrolled agent may be sufficient for some individual taxpayers and small businesses depending on the complexity of their returns. But more complicated questions may be beyond their training. In this case, an enrolled agent may direct a client to a CPA (certified public accountant) when appropriate. 

4. Accountant

Did you know that not all accountants are CPAs? Although these two terms are often used interchangeably, accountants can take and pass the CPA licensing exam but are not required to.

So can a non-CPA accountant do your taxes? The answer may be yes. Accountants often work as an employee of a business handling part or all of its finances. As such, they could be very knowledgeable about the business's books. However, this doesn't necessarily mean they are a tax expert and will be able to save your company the money it deserves. And, keep in mind, the IRS classifies them as unenrolled preparers. 

5. Certified Public Accountant

Finally, should you hire a CPA to do your taxes? While this is the highest investment you will make in a tax preparer, you also get the most for your money. CPAs, unlike unenrolled preparers, can represent your company before the IRS throughout almost all steps of the process — including audits and face-to-face meetings. And they have a wealth of experience in handling diverse tax matters for many clients. 

How to Choose a Preparer

A taxpayer who understands their choices for tax preparation can make the best decision about what level of skill and representation they need. To learn more about tax preparation services and certification by the IRS, meet with the pros at Bliss & Skeen. We offer a wide variety of services to meet your budget and needs. Call today to make an appointment.