How To Become a Tax Preparer

by Jordan Fabel | Last Updated: December 1, 2021

If you want to make some extra money during tax season, becoming a tax preparer is a great idea. This can also be a full-time career, but many tax preparers do the majority of their work during tax season.

As a tax preparer, you will be trained to help businesses and individuals. You will help them get the best possible return or pay in the least amount possible. Let’s look at the job duties of a tax preparer and how you can become one.

Job Duties of a Tax Preparer

Your main job duty, as a tax preparer, will be to prepare the necessary tax forms for clients. You will also submit these forms to the Internal Revenue Service (IRS) on behalf of your clients.

Many tax preparers work with both individuals and businesses. Others specialize in one or the other. Along with preparing forms, many tax preparers will also provide some financial help for clients. Some of the most common job duties of a tax preparer include:

You may have other job duties, as well, depending on your employer.

How to Become a Tax Preparer in 4 Steps

Step #1 – Finish High School or Get a GED

No matter the type of tax preparer you plan to become, you will need to complete high school or get a GED. Many tax preparers will go on to college, which means doing well in high school is a good idea. With good grades and high SAT or ACT scores, you can get into a better college degree program.

Step #2 – Complete the Correct Training

For some types of tax preparers, such as CPAs or tax attorneys, an advanced degree will be necessary. Others will simply need to complete the right courses from a community college or vocational school.

The National Association of Tax Professionals will likely offer accredited courses in tax preparation. These courses will help you understand how to fill out the forms properly, conduct a taxpayer interview, and calculate refunds.

Step #3 – Get Your ID Number from the IRS

As a tax preparer, you will need a Preparer Tax Identification Number or PTIN. This number comes from the IRS. You will need to fill out an application with your personal information to get this number.

Once your application is approved, you will get a certification as an unenrolled preparer. This status allows you to fill out and fill basic tax returns for businesses and individuals.

If you plan to start a tax preparation business, you will need to get an Electronic Filing Identification Number or EFIN. This comes from the IRS and will require a criminal and credit background check. Once approved, you will be able to e-file tax returns for clients.

Step #4 – Get Your Tax Preparer License

In some states, you will need to get a tax preparer licensed. These states include California, Connecticut, Maryland, Nevada, New York, and Oregon.

You may need to take additional courses to qualify for a license. Some states will also require you to complete continuing education every year to keep your tax preparer license.

Types of Tax Preparers

You can become one of many different types of tax preparers including:

Common Skills You Need to Become a Tax Preparer

No matter the type of tax preparer you become, you will need the right skills. While you can gain the training you need, some of the skills you should develop include:

These skills are very important if you want to become a tax preparer. Work on developing your skills as you go through the training for this career.

Frequently Asked Questions About Becoming a Tax Preparer

How much can I make as a tax preparer?

While the average salary for a tax preparer can vary greatly, non-credentialed tax preparers often make about $16.56 per hour, according to Indeed.com. Some tax preparation firms pay much higher amounts, especially if you have additional training.

If you work in New York, Las Vegas, Atlanta, or Chicago, you will likely make above the average amount. These are the highest-paying locations for tax preparers.

What type of benefits will I get as a tax preparer?

If you only work seasonal, you will likely not gain access to many benefits. However, you might still get the ability to work from home and gain bonuses through a referral program. Those working full-time may also get a 401(k), health insurance, life insurance, paid time off, and many other benefits.

Do I need a degree to work as a tax preparer?

No, in most cases a college degree isn’t necessary. You will need to complete high school or get your GED, however. Additional tax preparation courses may also be necessary and you will need a PTIN number from the IRS. However, if you have a bachelor’s degree you may earn a higher salary.

Where can I get experience working as a tax preparer?

Many entry-level tax preparer jobs are found at tax attorney offices, accounting firms, and tax preparation chain locations. It’s common to gain experience working during tax season for one of the larger tax preparation firms.

Are there any advancement opportunities for tax preparers?

Yes, if you start as an unenrolled agent, you can pursue a career as an enrolled agent. This allows you to earn more money after completing the necessary training. It’s also possible to go into business for yourself as a tax preparer.

What are the different titles used for tax preparers?

If you become a tax preparer, you might not be called a tax preparer. Instead, you might work as one of the following:

These titles are all used for different kinds of tax preparers.

What types of tax forms will I prepare for my clients?

When you become a tax preparer, you will likely use Form 1040 quite often. This is the most common form for individual tax returns. It’s also common to use Form 1120, as this is the form used for corporate tax returns. You may also need to interpret partnership agreements often if you prepare taxes for businesses.

Where do I find a job as a tax preparer this tax season?

Most of the tax preparer jobs will be found with larger tax preparation firms. You can also work freelance for yourself as a tax preparer. Accounting firms and law firms will also provide some job openings during tax season. It’s easy to find these job openings listed on major career websites.

If you’re looking to boost your income during tax season, becoming a tax preparer is a great option. It can also become a full-time job if you get the right training. Use the steps outlined in this article and you can get the necessary training to become a tax preparer.

Jordan Fabel

Jordan Fabel

Covering different 'paths' that people's lives can take. Creative, foster parent, ticket dismissal, you get the idea. Exploring the requirements, certifications, exams, and obviously, approved courses along each path. I, personally, am the high school dropout son of two teacher parents. So how did I get here? That story is coming soon!