Watch for pitfalls when unqualified preparers do tax return

Houston Better Business Bureau offers reviews of companies, tax preparers

HOUSTON – Preparing your tax return is not only complex and confusing, but it can also be loaded with pitfalls if you hire someone to prepare your taxes for you that isn't qualified.

Mary Ayala is a Houston tax preparer who has been doing taxes for other people since 1988, more than 25 years.

"I was just astonished at the type of error that occurred in that return, it should have never happened, if the person knew anything about doing taxes," Ayala said.

Ayala just finished rescuing a tax client who had her tax return completely botched-up by a less than qualified "tax preparer." Ayala said this "hack" of a tax preparer charged the woman $180 up front, and then somehow added more than $3,000 to the woman's adjusted gross income.

All of that had the effect of raising the amount of tax she owed and lowering the amount of credits she was due.

Bottom line, that woman would have lost more than $1,100 in refund money had Ayala not caught the costly mistake.

How can you keep this kind of rip-off from happening to you?

Every day, people at the Houston Better Business Bureau receive and document official complaints against professional tax preparers. Then, they grade these preparers and the companies they work for on a scale from A to F, and they publish those grades on the BBB website for consumers to read. You can even read the words of the complainants and the responses from the companies, if there are any.

Want to know how the tax company you are planning to hire measures up? All you have to do is go to the BBB website and punch in the name of that tax preparation company.

The BBB said never hire a tax professional who bases their fee on a percentage of what you get back in the form of a refund, or hire a company that promises out front to save your more money than another.

Remember, even when someone else does your taxes for you, if there are mistakes, you are the one on the hook. You will pay in lost refund money. You will get audited. You will pay any penalties that are assessed.

To find a competent tax pro, first make sure you ask the preparer for their Preparer Tax Identification Number or PTIN. Federal law requires all tax preparers to have one. If the person you want to hire can't provide one to you, walk away.

Next, make sure you check that person's background on the BBB website. Ask the preparer to give you a quote on the price they will charge you.

Most importantly, ask your closest friends for a recommendation on who they use. Not all tax pros are created equal, it's up to you to find the best you can.


About the Author:

Emmy-winning investigative reporter, insanely competitive tennis player, skier, weightlifter, crazy rock & roll drummer (John Bonham is my hero). Husband to Veronica and loving cat father to Bella and Meemo.