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The IRS plan for return tax preparer registration is scheduled to begin September 2010 and will affect nearly every professional tax preparer in some way. Paid tax preparers must register with the IRS to obtain a Preparer Tax Identification Number, pass an IRS exam and satisfy annual continuing education.

The definition of a professional tax preparer or paid tax preparer is as follows: all individuals, Attorneys, Certified Public Accountants and Enrolled Agents who are compensated for preparing, or assisting in the preparation of, all or substantially all of a federal tax return or claim for refund or who sign, or are required to sign, a federal tax return or claim for refund as a paid tax return preparer. Any individual falling under this category must obtain a Preparer Tax Identification Number (PTIN). All paid tax preparers must obtain a PTIN in order to sign any federal tax returns or forms. The PTIN they obtain will be valid for three years. Testing of these preparers who hold a PTIN will not be implemented until after registration and mandatory PTIN usage are in place. Employees of a business who fill out their employers return will not be required to obtain a PTIN.

All paid tax preparers including Attorneys, Certified Public Accountants and Enrolled Agents who obtain a PTIN will potentially be placed within a national public database. Other information about which paid tax preparers and what information would be included is not yet available.

As of right now, the only paid tax preparers who will not have to pass the new IRS competency exam are Attorneys, Certified Public Accountants and Enrolled Agents. Paid preparers in states such as California, and Oregon who have to pass their own states’ individual criteria must still pass the IRS exam. Credential holders of organizations like the Accredited Council of Accountancy for Taxation (ACAT) will also have to pass IRS competency exams and take the continued competency testing. Across the board, regardless of any private or state accreditation, if you are not an Attorney, Certified Public Accountant or Enrolled Agent you must obtain a PTIN, pass the IRS competency exam, and take continued competency testing in order to be paid to prepare federal tax returns as a registered tax preparer.

Attorneys, Certified Public Accountants and Enrolled Agents who prepare all or substantially all of a federal tax return or claim for refund will also have to obtain a PTIN and pay the fee associated with obtaining a PTIN. However, they are not subject to the new IRS testing or additional educational requirements if they are active and in good standing with their respective licensing agencies.

Looking at this brief outline of a few of the rules and regulations proposed by the IRS, simply becoming an Enrolled Agent will potentially help you avoid 90% of the proposed rules. Of course, it remains to be seen how quickly the IRS can implement these changes or if all the changes they desire will be seen to fruition.

Online income tax preparation provides a safe, easy way to file your taxes. According to the IRS.gov official website, electronic filing (e-file) has been an accepted way to file by the Internal Revenue Service (IRS) since 1986. Some accountants have been using this method to file for their clients for more than two decades. Between the IRS and many innovative tax services, online tax filing has now been streamlined to accommodate the needs of individuals and businesses. Let’s take a look at five major benefits of filing your taxes online.

1. Saves Time and Money for Everyone Involved

Online income tax preparation saves time and money for you, the online tax service, and the federal and state government. You’ll save time because you can fill in your information using an online form or through e-file software without hand writing all your information. Even if you opt for paid assistance with your online tax filing, you won’t have to visit a physical accounting office to achieve this task. You can save money by paying less for online services, or you might be able to take advantage of free e-file services available through the IRS via many online tax services. You can also receive your refund much faster by filing electronically….usually within a couple of weeks if there are no complications. You can opt for direct deposit of your tax refund into your bank account for faster payment.

Filing electronically saves time and money for the IRS because there’s less paperwork when taxpayers use this method. Tax preparers also save by providing online services. They can work primarily through e-mail, thus, reducing in-office appointments. Some accountants only offer services through the Web, so they don’t have the typical overhead expenses of operating a physical office.

2. File Your Income Taxes from the Comfort of Your Own Home

Another benefit of online tax filing is you can file your returns directly from your home computer. This provides a great convenience if you have a busy schedule or usually work long hours. You can fill in your tax information through e-file forms any time, day or night, without missing a day of work or wasting a Saturday just to prepare your tax returns. Whether you use e-file software, an online free e-file service or opt for other paid tax services, you’ll be able to take care of all your filing needs from home or the office.

3. Reduce Errors when Filing Your Own Taxes

We can all make mistakes – even on important tax forms! Online income tax preparation can reduce errors because paid or free e-file forms will calculate your mathematical totals for you. Online e-file forms will catch other errors as well and prompt you to correct them before moving forward with the form submission. This also reduces errors on the IRS side, which can easily occur as the taxpayer information is keyed into computer systems from handwritten forms. After all, the person keying in the information is human, and not everyone has very neat handwriting! Less errors means less of a chance for an audit and quicker processing of your tax return.

4. Get Help for Complicated Tax Needs

Online income tax prep is not only for simple filing, but can also be helpful for complicated tax needs. If you own a business and need paid tax services, many online tax companies provide an array of services to cater to your needs. Get help with business expenses and mileage deductions, corporate tax needs, home or business tax credits, and more. If you usually work as an independent contractor, an online tax service can help you maximize your tax benefits. You’ll find that many paid services online are less expensive than local tax offices while providing the same caliber of service. Some offer year round business accounting services…not only during the tax season.

5. Easy Filing for Federal and State Income Taxes

When filing your federal income taxes, some e-file services provide a quick way to transfer your personal data to a form for state filing. You may have to pay a small fee to do this, but it can be well worth it if you wish to avoid filling out other tax documents. Keep in mind that state filing is always separate from federal income tax, and the duration and amount of your refund for state taxes will differ from federal taxes.

With online income tax preparation, you’ll no longer have to dread filing taxes each year. Enjoy this quick, simple method of tax preparation now and for all future filing needs!

There are certain reasons why you should choose online income tax filing method instead of traditional paper filing method. Even the IRS recommends e-filing method because it is easier, faster and safer method to pay taxes.

First of all, you have to prepare your taxes properly because you may get penalized for filing fraudulent return. Most people consider hiring professional CPA because they do not want to take chances for getting their return rejected or being audited by the IRS but getting a CPA may cost higher during the tax season.

So, is it possible to prepare return at affordable prices? Fortunately, there are options for preparing and filing your return either for free or for some minimal charges. There are online tax preparation companies that have been offering e-filing services for some little fees. The best option is Free File program by the IRS which allows you to prepare your return and file your return electronically for free. But you have to qualify for this free file program for doing IRS income tax online. If your Adjusted Gross Income does not exceed the limit of $57,000, you can make use of this free file option. Or else, you can think of preparing and filing your return online using an authorized IRS e-filing provider.

Benefits of Income Tax Filing Online:

1. It is Quick & Easy
Now preparing return file and submitting to the IRS online is easy and quick. You do not have to worry whether you have knowledge of complex tax codes or not. All are done easily with the help of software offered by the IRS authorized service provider. All sorts of math and calculations are done easily with the help of software program. Even you can easily search for the possible tax deductions that you are eligible for and claim them for saving your taxable income.

2. It is Accurate and Error-free
You do not have to worry about getting penalties for filing fraudulent return. Preparing and filing income tax online is accurate. The software will alert you if there are some mistakes or errors. Just you have to make sure that whatever information you are providing to the software is accurate. This will also help you decrease your chances for being audited by the IRS.

3. Get Confirmation from the IRS
This is one of the remarkable advantages of filing return electronically that you get confirmation of acceptance of your file from the IRS within 48 hours. You do not have such confirmation advantage with traditional paper filing method. Once you are confirmed by the IRS that your file is reached there, you get relaxed. Moreover, you have better chances that your e-file will get quickly processed compared to paper filing method because the IRS service center will not have to waste their time for retyping your return.

So, aim at preparing you return as accurately and error-free as possible so that the IRS will not have any reason to reject your file and you will not have to trouble for being audited. Try to send your return file electronically well before the deadline and avoid getting penalized for late filing!

It’s quite common that when it comes to doing taxes, people often seek advice from a tax specialist. There are online tax preparation services that can make your tax preparation and your return filing process easier. You can work with Online Tax Specialist an efficient income tax service, to prepare your tax return.

Now doing taxes is no longer a boring task, you can easily do taxes online with the help of tax software programs available. If you visit the IRS website – irs.gov – you will come to know that several tax services offer tax preparation and e-filing facilities. The IRS, in association with some tax services, provides “Free File” program to e-file taxes for free. Those U. S. taxpayers whose AGI or adjusted gross income is less than $57,000 are allowed to use this free software. If you do not qualify for the Free File program, then you can consider the best online tax service provides.

It’s has become much easier to prepare online tax return using tax software and online tools. You can also learn some tax preparation and e-filing tips from the IRS website and make your task easier. Compared to paper filing, income tax filing is easier, faster, and safer. The tax prepare software facilitates you do your taxes in step-by-step manner. The program will ask you certain tax related questions and you will have to answer them accurately. You’ll be provided with tax forms in which you have to arrange your information asked by the software.

While preparing return files, most people think of availing the advantages of tax credits as well as deductions. The program will let you select the deductions that can suit your tax situation. You need to choose the deductions sensibly so that the IRS has fewer chances to audit your return.

You have to file your return electronically well before the deadline so that your return my get processed soon. You’ll get confirmation note from the IRS within 48 hours as you submit your return electronically. This will ensure you that your return file is accepted by the IRS.

As far as receiving refund is concerned, you need to choose direct deposit option so that your refunds will directly be deposited into your bank account. This will make you relaxed because you do not have to worry about your refund getting lost or stolen.

File your federal or online state tax return with Online Tax Specialist before or on time so that your refund will get processed soon. Get your refund faster within 10 days via Direct Deposit Option.

During tax time you spend a lot of money having someone prepare your taxes for you. If you want to save yourself some money on next years tax preparation then you may want to invest in income tax software. There are disadvantages to using this type of software and it could cost you a lot of money in the end.

The main expense to using online income tax software is the initial purchase of the software. After you purchase the software you can use it every year for as long as you have the software and a compatible driver to read it. One disadvantage to using this software is that you don’t have a real human being to look over the forms and verify the information. There is no way to check for errors and even software can make errors.

If you are using income tax software to prepare your taxes you won’t have anyone to answer your questions for you if you run into problems or questions on your forms that do not seem clear. If you called someone they may or may not be able to help you. When you have a CPA doing your taxes they look over everything and check it twice so you are able to make sure everything is accurate and then it is sent in to the IRS.

When using the tax software the calculations may be accurate but you won’t have a human to look over the paperwork and verify that all the numbers entered are accurate. Sometimes even the slightest typo when entering numbers can cost you thousands of dollars. A CPA will go through and double check to make sure that all the numbers entered are accurate based on the information that you gave them. This is critical because again it could leave you paying thousands of dollars and the IRS will not know that you actually did file your tax returns. If you hire a CPA to file your returns they can verify to the IRS that you did indeed file those papers.

There are also disadvantages to using the software; you do not have someone to back you up if you are audited. Although the software keeps track and provides you with the opportunity to print out all the necessary paperwork associated with filing your taxes if you are audited the software cannot speak up for you. You will need to take care of all the necessary paperwork yourself to file when you use the software. That can be another disadvantage. You want to make sure that the IRS receives your paperwork and a CPA can give you that guarantee.

If you have questions about filing or using income tax software then you can always ask the IRS or you can call your trusted tax preparer to ask them any questions you may have. Tax preparation should not be difficult. Hiring a CPA to prepare your taxes is not difficult either and you have the guarantee that you need.