What Happens In The Tax World At The End Of A Calendar Year?
Something interesting happens during this time of the year. First, all those hundreds of IRS tax forms and their related instructions that we know about, are mostly getting updated and those newer versions start getting released. Generally, the IRS starts releasing these forms around Thanksgiving time. That’s when the tax preparers expect to see the new versions of forms. Tax professionals look forward to this time of year as it clarifies a lot about previously confusing changes to the tax law.
Second, Congress and the political administration have to deal with expiring tax provisions. In other words, there are temporary tax provisions every year that are implemented as a result of the current economic lay of the land. It’s quite common to have certain provisions that are created for just one tax year. When Congress comes into session, around Thanksgiving till New Years (January 1st), the lawmakers have to decide which tax extenders will be left to expire and which laws will be extended. This process affects a lot of the final law, and influences the final provisions which are going to go into effect in January of the new year which is when the tax season starts.
When Do Students Learn About The Latest Provisions On The Tax Law?
As an IRS approved provider of continuing education of tax preparation, this is the time of year when National Tax Training School offers annual updates and refresher courses. Additionally, when we teach about 2022 forms which have not been available up until this point, the fourth quarter is the time when we start integrating the newer forms into the courses. On a related note, tax software developers are extremely busy at this time of the year because they have to integrate these new forms into their offerings. These companies have a small window from Thanksgiving until the end of the year to update their software and tax programs and integrate the new forms and calculations. All this is what happens behind the scenes in the tax world at this time of the year.
What Are The Advantages Of Starting A Career In Tax Preparation During This Time Of The Year
Professionals thinking about a new career in tax preparation at this time of the year have the advantage of actually becoming familiar with things that are current, live and happening right now. In other words, one is dealing with the practical and timely vs. the theoretical. It’s much more imminent given that things are happening just around the corner. Congress at this time is passing laws, and figures, rules and numbers are getting finalized. Individuals that are ready to learn taxation are actually more tuned in, and can relate much better to the news and to the changes.
At this time of the year, as we get close to tax season, people start asking tax questions. Clients of tax professionals seek tax advice pertaining to this current year and also how to prepare themselves for the upcoming new year.
One has to position themselves at the onset of the upcoming year regarding their spending and purchasing as to how it affects them financially in their tax bracket. Everyone wants to make sure that their business expenses, investments, earnings and income are set up properly to their advantage for the upcoming year.
As an example, if there are any questions regarding business deductions that are set to expire, the tax preparer would advise to spend more now since they will get the immediate benefits vs. waiting to expense after January 1st when they are no longer valid.
Should A Tax Preparer Participate in Continuing Education At This Time of the Year?
Yes. The IRS has designed a voluntary continuing education program called the Annual Filing Season Program (AFSP) and National Tax is an approved provider. The program helps the practicing tax preparer keep up with all changes, reinforces their knowledge of common tax provisions and reminds tax professionals of their ethical responsibilities. Although this is not required by law, there are significant benefits to the course.
Benefits of Participating in Continuing Education:
- Becoming current with changes to the new tax laws
- Getting listed in the IRS directory for tax preparers
- Better representational rights for their clients before the IRS
In order for tax preparers to take full advantage of this offering, the program needs to be completed by December 31st.
What Bookkeepers Shouldn’t Miss This Tax Season
Bookkeepers, as trusted advisors, are very much involved at this time of year in handling, managing and closing books for the end of the year. Additionally, Bookkeepers are very much involved in people’s personal finances and preparing for the upcoming tax year. Each one of these clients are required to have their taxes filed, so it would be understandably beneficial for the bookkeeper to offer this service as well. Both bookkeepers and clients want to start a new year having everything in place.
Why Is It Important To Be Prepared For The Tax Season
Upon every upcoming tax season, Tax Preparation and CPA firms need to be educated and gear up for an increase in new customers and clients. National Tax prepares the preparers to prepare. At this time of year, CPA firms with a potentially heavy workload, are seeking and searching for newly trained professionals in the industry. They’re going to hire you for the upcoming tax season, you’re going to get benefits and you will gain a lot of experience. Professionals might start on the lower rung of the ladder, but it’s the best time to be hired by these CPA firms.
Why Insurance Agents and Brokers Make Good Tax Preparers
Similar to Bookkeepers, Insurance Agents and Brokers are trusted advisors that have an existing client base. This access to insurance policies and financial portfolios enables them to be familiar with their client’s finances, investments and incomes. This access provides another good potential opportunity to offer tax preparation service. They might find that their clients are just going to some untrained tax preparer, or some unreliable and unattentive group of tax preparer franchises. Alternatively, these agents are able to offer them personalized and responsible attention that will serve them best.
Why It’s Not Too Late To Enroll To A Tax Preparation Course This Time Of The Year
The duration of the National Tax Federal Income Tax course is about 150 hours and anyone can complete this in about 8 to 10 weeks. When you do the calculations and you think like a tax preparer, dealing with numbers, we estimate 150 hours. If you apply yourself for about two hours daily, then it’s very doable in eight weeks. All in all, you should approximate around 60 days or two months and you will have ample time to complete the course.
When you invest two hours a day, a number of things can happen. First, you might need more time. You might be able to devote more time to this if your schedule allows. On the other hand, if your schedule doesn’t allow for 2 consecutive hours, then it can be broken down to different times of the day. Perhaps a little bit in the morning or evening or whenever you have time, perhaps on the weekends. Second, it depends on how well you grasp the issues at hand. Certain areas of the tax course can be completed at a much quicker pace. Other aspects require you to pay more attention.
Tax season officially starts on January 1st. Technically though, the IRS does not release some of the forms before January 1st. This can go well into January. Tax preparation software developers find themselves releasing and finalizing product updates well into the month. Generally, clients are not yet seeking tax preparation services, so you have more time. You have the advantage of learning and practically being involved in it while it’s happening. So when January 1st arrives, you are ready to start. By this time, you have already learned quite a lot to be able to service clients. You might not have wrapped up your training yet, but you’re becoming more aware and alert to finish it and apply what you’re learning.
Is It Recommended To Start Your Own Tax Preparer Business Rather Than Starting By Working For Others
There are obviously two options: either you start up your own tax practice or work for a CPA firm or any tax preparation firm. At National Tax, we like to encourage students to pursue independent careers and start up their own businesses. There are a lot of advantages to owning your own business; opportunities, flexibility, independence, and the potential to build a solid growing client base. However, some people find this too much of a burden, and prefer to work for others. Over all, it really depends on your personality, how ambitious you are and how you approach it. Whichever way you decide, this is the time of the year to make it happen.
It is important to note that whichever way you decide, there is no pressure since it’s not necessary that it has to be full time. When we talk about going out on your own, you should start with your own taxes, which you’re going to need to do very shortly for yourself. Then comes family, friends, and acquaintances who will all need these services fulfilled. Since there is a personal connection, you have a much better opportunity reaching out to them as an independent tax preparer.
Summary: Looking Towards a New Year and a New Career
In this article we discussed what happens in the tax world at the end of a calendar year. At National Tax Training School, we plant seeds to encourage our students to prepare themselves for a better career, a better income, a productive future and a more fulfilled life. Learn more about our organization by visiting our website or just give us a call.
About National Tax Training School (NTTS)
National Tax Training School was founded in 1952 and over the past 60+ years has grown into the most recognized and respected distance learning institution dedicated to training its students in US federal taxation. NTTS is dedicated to providing Federal Income Tax Courses, IRS Annual Filing Education, Tax Preparation Classes, and IRS Annual Filing Season Programs.
Summer and Fall 2022, Back To School, Back To Work, New Career
Summer is the time when most people take vacation and think about what they are going to do after the Labor Day Weekend, which is the sign of when summer usually ends. People think about going back to school, their careers, their pocketbooks, inflation, and how costs are rising. Especially during the summer of 2022 when inflation was at a historical high and gas prices surpassed over $5.00 a gallon. During the time period as we approach Labor Day, many people find themselves in need of a new career and a new job. Many people want to start a new job right after Labor Day and the others are too stressed to push it off any longer and prefer to start working before the summer ends so that they are settled. A new career in tax preparation is timely right now, because now is when people start preparing not only for a new financial year that starts in September, but also they want to be ready for January 1, 2023.
Why A Career In Tax Preparation Is Timely Right Now
Tax season officially starts in January when people start preparing their own IRS federal and state tax returns. During this time, accountants and CPAs usually request statements and documents from clients. This is also the season and month when companies send out W2 forms and 1099s to their employees. The Fall is the time to pursue education, training, and position yourself in order to be ready for the upcoming tax season. Once January 1st comes around, you want to have your name and your tax business shingle hanging out for all to see. You also want to have your advertising and marketing in place because that is when everyone becomes aware that they need help with their taxes for the year. You have to have ample time to learn, practice and train to be prepared to start, and confident that you are ready to provide these important IRS tax preparation and financial services.
Who Should Consider A Career In Tax Preparation?
What makes a good candidate to enroll In tax preparation courses? Anyone that already has a knack for numbers should consider a career in tax prep. A person that enjoys making calculations and who is creative at figuring out strategies that save money, are great candidates. Detail oriented people who like to read the fine print and search around for bargains, calculating and comparing numbers and prices, utilizing spreadsheets with columns consisting of pros and cons are great prospects for a career in tax preparation. Highly organized individuals will immediately realize that they will be very successful in this type of career. The mindset of working with numbers, envisioning a better way to work with them and ultimately coming to a money-saving conclusion, creates the most successful candidate in tax preparation.
Who Is Eligible To Be A Tax Preparer?
To become a tax preparer, you do not have to be a college graduate. With a GED and/or a high school diploma, one who does well in math has the potential of succeeding in the field of tax preparation. One does not have to be a genius or an academic wiz to be successful, you just have to be prepared to concentrate and deal with intricate numbers and details. National Tax Training School teaches students from the ground up. With any background, path of education and average IQ, one is destined to thrive in this exciting field. One who is ultimately dedicated to learning tax preparation and gets the proper foundation training, will develop great experience in no time.
Why Is Experience The Best Education?
To become an artist, you have to have it in you. With tax preparation, you must initially be dedicated to learning. Then, after a short while of working in the field, with each client and each scenario of saving people money, one gains the most valuable experience.
What Are The Resources Needed To Start A Career In Tax Preparation?
People with limited resources can still start learning tax preparation today. You don’t have to invest a significant amount of money, and with a surprisingly minimal investment one may enroll in our course. Tax software is another investment preparers will need to purchase.
Students can access the online learning system from the comfort of their home, a cafe, coffee shop or anywhere at any time. With basic Internet, wifi access and a laptop or smartphone, students enrolled in the course will conveniently be able to complete their training and studies that will last them a lifetime.
When Should One Start Training To Become A Tax Preparation Professional?
One will need anywhere from a few weeks to a few months in order to be ready for Tax Season. National Tax Training School is constantly updating the tax preparer course, and in fact just finalized the most current version and released it to all recently enrolled students. These students will be getting the most up to date version of the course. That’s why, NOW is the optimal time to enroll. NTTS constantly strives to add timely updates to the curriculum as a result of Congressional changes to the tax laws. In fact, President Biden just passed a bill called the Inflation Reduction Act. Although it may not have a significant impact on basic United States taxation, it does indeed have tax ramifications. Now is the time to become familiar with all of the new and updated changes that are happening AND going to happen. Usually, these updates get implemented by Congress at this time of the year when Congress returns to office after summer vacation. Congress then focuses on these acts, tax provisions, and extensions of previous revisions.
How Long Does The National Tax Preparation Program Course Run?
The course is 150 hours of self paced study. The student is in the driver’s seat and sets the pace. If we break it down by two hours daily, it’s about 10 weeks worth of program. If a student starts today, by the end of the 2nd month or sometime in the 3rd month, they should comfortably be able to finish the course. With all this under consideration, finishing the program will likely take one 8 – 10 weeks. Some people give themselves even more time to feel confident so within 3 months they are ready to start taking on clientele.
How Can One Start Their Own Tax Preparation Business?
First, one will need time after finishing the National Tax Training School tax preparation course in order to absorb and review the material they have learned. Some professionals will want to find office space, sublet or work from home. It is also recommended to have enough time to advertise and to do some research on your local and regional market.In the beginning of the tax season, expect to be busy while also maintaining a business development strategy. You will not want to turn away any potential clients.
Building a Profitable Tax Practice
The Guide Book (https://nationaltax.edu/publications/building-a-profitable-tax-practice/) we give out to students helps them build their tax practice business. The National Tax Training School guide book, “Building a Profitable Tax Practice” is written by National Tax and it covers everything you need to know on how to successfully establish and maintain a tax preparation business.
Topics covered in the book include:
- IRS requirements
- Office technology
- Successful marketing strategies
- Staff hiring
- Ethical responsibility
- Billing and Fee structure
- Collections
- Handling IRS tax audits
- Professional development
- Mergers and acquisitions
- Reporting
Is A Career In Tax Preparation Stable?
Every US citizen is required to file taxes, so a tax preparer offers essential services that everybody needs. When tax clients are satisfied, they will depend on the professional for their taxes year after year and even refer their friends and family. As one consistently provides tax preparation services, they build on existing and return client work experience as their client base grows. Expanding a business by establishing a professional network and concentrating on retention makes the business even more stable.
How Profitable Is A Career In Tax Preparation?
A tax preparer has unlimited potential to grow his or her income as much as they are willing. As mentioned above, everyone needs their taxes done. A tax preparer will always be able to provide services and they can work as much as they want and as little as they want. One can work part time and still be very busy during Tax Season.
Tax Preparer vs. Bookkeeper/ CPA/ Accountant?
A tax preparer 100% COMPLEMENTS being a bookkeeper, CPA and/or accountant. There is no conflict whatsoever and if anything, the professional and their clients benefit from their knowledge and experience greatly.
An accounting degree isn’t for everyone. Though there are plenty of benefits over tax preparation, getting an accounting degree requires much more time, effort and a significant investment.
Accounting also involves a wide range of financial services such as financial statements, business regulations, corporate structuring etc. whereas a tax preparer focuses on the tax aspect. Preparing tax returns, providing tax related advice and skillfully concentrating on finding tax savings is a major benefit of taking our tax prep course.
A significant percentage of CPAs certainly have knowledge of tax preparation, but they aren’t necessarily experts. They usually have staff and employees like students of ours, who do their tax prep work for them. A CPA is a general term for someone that went to college and received a degree in accounting. A CPA is a designation, and that means working on the overall finances of individuals, corporations and businesses.
Students who are not yet ready to start a business on their own, will often end up with great opportunities. Many CPAs and accounting firms are constantly seeking to hire individuals with tax preparation expertise to fulfill their client needs. This is quite common and especially true around tax season.
All in all, becoming a tax preparer is quite advantageous and beneficial since CPAs are not only looking for these professionals, but also are looking for partners.
Bookkeepers will find that having professional tax preparation knowledge will greatly add to their overall offerings and services. They naturally deal with many clients who ultimately need their taxes completed and filed. With the addition of a tax preparer on staff, bookkeepers are able to offer to their existing client base financial services as well as tax help.
Why Is Tax Preparation A Satisfying Career?
There’s nothing more satisfying and empowering than when you immediately show people how to save money. When you help US Citizens and show savings in their taxes, the money you save them is money in their pocket. All professionals desire their clients to be pleased. When one shows a client how to move around personal and corporate finances with security, they gain a satisfied customer.
Who Can Establish a Thriving Tax Practice?
Many ask if they need prior experience and skills in order to succeed in a career in tax preparation. Former mechanics, school teachers, salespeople, homemakers, and employees from different industries have all thrived in the field of tax preparation. So when one asks if this path is right for them, National Tax Training School replies ABSOLUTELY!
About National Tax Training School (NTTS)
National Tax Training School was founded in 1952 and over the past 60+ years has grown into the most recognized and respected distance learning institution dedicated to training its students in US federal taxation. NTTS is dedicated to providing Federal Income Tax Courses, IRS Annual Filing Education, Tax Preparation Classes, and IRS Annual Filing Season Programs.
The Tax Preparer Industry
There are several potential benefits to pursuing a career as a tax preparer, not the least of which is the ability to successfully prepare and file your own taxes. You’ll also have options for flexible scheduling, work-at-home opportunities, seasonal or yearly work, and livable wages.
The added bonus of choosing this profession is that knowledgeable and skilled tax preparers are in high demand. Whether you work with a firm or strike out on your own, you should never fall short of having as much work as you want.
Naturally, you’re bound to be busier at certain times of year (tax season), but with businesses requiring bookkeeping, quarterly estimated tax filings, and other services throughout the year, tax preparers that want to work year-round can certainly do so. Even better, it’s not a perishable skill, and you can take it with you should you move to another location.
The question, then, is how to get started. How can you become a tax preparer and what type of career trajectory awaits you? Here are a few things you should know if you want to get into the tax preparer industry.
Requirements
Although there are no specific post-secondary educational requirements for tax preparers, you should certainly get your high school diploma or GED, and your math abilities should be at least adequate. From there you can look into programs designed to teach you what you need to know to become a certified tax preparer.
This education will allow you to meet certain standards that make getting a job or starting your own business a lot easier. Some firms do not require you to have a certificate or license upon hire, although they will almost certainly train you and most require you to work toward certification. In order to prepare federal taxes, the IRS requires that you hold a Preparer Tax Identification Number (PTIN).
Choosing the Right Program
The main thing to remember when it comes to your education is that it is essential to find a tax school that is licensed and accredited. The good news for many prospective students is that National Tax Training School which is licensed and nationally accredited provides the opportunity to earn online certification in as little as 8-10 weeks.
Finding an Employer
As a certified tax preparer, you will have the opportunity to work for any number of businesses that specialize in filing taxes for individuals or business entities, or that offer the service as one of a number of different customer services. You could end up working for a tax prep company, an accounting firm or independent CPA, or even a law firm.
Some of these jobs are likely to be seasonal or provide only part-time work, while others may offer you the opportunity to work year-round, depending on the clientele and your level of ability (as well as your desire to work). The Bureau of Labor Statistics (BLS) reports that jobs for tax preparers and accountants are on the rise, and this is likely due to the complex and fluid nature of tax law. In other words, you should have little trouble finding employment opportunities as a certified tax preparer.
Working for Yourself
Many people are interested in the prospect of entering the tax prep industry as a means of attaining a flexible employment schedule and/or working from home. Becoming a tax preparer offers many opportunities that aren’t available in other fields, especially in finance.
As a certified tax preparation specialist, you can certainly choose to work for yourself, work from home, and build up your own clientele. You can decide how much or how little you want to work. This is an ideal situation for stay-home parents looking to bring in a secondary income, students seeking a side job while they’re in school, workers who want to supplement another income, or anyone who wants to be their own boss, really.
Becoming a tax preparer allows you the freedom to make decisions about where you work and how much you work. Of course, if you’re going to work from home you must exhibit a certain level of determination, as well as an ability to effectively manage your time, if you want to earn a living.
Tax Prep as a Supplemental Income
Not everyone interested in a career in tax preparation is looking for full-time work, and there are definitely ways to create a part-time schedule. If, for example, you’re interested in seasonal work, the months of January through April might demand a lot of work hours, but provide the supplemental income that sustains you throughout the rest of the year.
You could also find ways to work part-time by taking on just a few clients that provide you with ongoing work. Either way, you can easily earn the supplemental income you prefer.
Further Career Aspirations
Some people are so happy with the pay and flexibility offered by a professional career as a tax preparer that it becomes their long-term career. However, tax preparation can also be an excellent stepping stone to other careers in finance.
Not only does an understanding of taxation and the tax ramifications of financial and business decisions make you invaluable to any company that might hire you for other purposes, but the knowledge and skills you develop as a tax preparer can also segue nicely into a variety of professions, whether you go on to become a CPA, financial planner, estate planner, or other professional. Even an MBA grad with a background in tax preparation is more valuable than the average job candidate.
Becoming a tax preparer does nothing less than open doors, now and in the future. You may plan to become a tax preparer as a way to supplement another job or earn a secondary income for your household while raising a family, but if you decide to do more later on, you’ll already have a strong foundation in place on which to base other career aspirations.
The hallmark of reaching adulthood is understanding that you are not only capable of caring for yourself and others, but that it is your responsibility to do so. As an adult, you will very likely have to earn your way, at least if you want a roof over your head, food on your table, and some fun money on the side.
As a kid, you might dream of exciting jobs like acting or flying airplanes, but the chances of landing such jobs and actually making a decent living are pretty slim. You’re better off selecting a career based on your strengths and what you enjoy.
Some people are good with numbers. Some are organized and detail oriented. Some work well with people. If you exhibit any, or preferably all of these traits, you may have the makings of a tax preparer. This is an especially good choice for those uninterested in spending years toiling in school to earn an accounting degree and take a CPA exam.
Why would you want to consider such a career, aside from the ability to work from home, run your own business, set your own hours, and earn a living? There are many situations in which becoming a tax preparer could fit nicely into your current lifestyle. Here are just a few types of individuals for whom a career as a tax preparer could be the perfect fit.
Stay-at-Home Parents
More and more families are finding that two incomes are necessary to support a modern household. In many cases, one parent elects to stay home and raise children, either because both agree that it’s better than childcare or because childcare is too expensive and the parent who earns a secondary income is spending it all on daycare costs.
That said, a secondary income might still be necessary to make ends meet. This is where working as a tax preparer could prove to be the perfect solution.
For starters, there are online courses available through licensed and accredited schools, allowing stay-at-home parents to earn certification in as little as 8-10 weeks. This certification allows parents to work from home, bring in a secondary income, and help family, friends, and those within the community to prepare annual or quarterly tax filings. Plus, kids can grow up under the supervision of a caring and devoted stay-at-home parent.
Home-Based Workers
There are many reasons why workers might prefer a home-based profession. There are, for example, those who are unable to commute to an office environment due to disability, or for whom working in a traditional office setting would impose hardship.
However, it’s much more likely that you’re interested in work opportunities that don’t require you to wear a suit, sit in traffic for hours each day, and labor under the micromanagement of half a dozen superiors. In other words, you want to work for yourself, from the comfort and convenience of your own home.
Becoming a tax preparer is an ideal profession to consider. Once you’ve completed appropriate tax courses remotely and earned your certificate, you can begin to build a network of clients, starting with family members, friends, neighbors, and other acquaintances.
You can determine how many clients to work with, how much to charge, and when to work, although naturally you want to build a big enough clientele to earn a living. Whether you simply work during the busiest tax preparation season or you work year-round helping clients stay on top of bookkeeping and quarterly filings, you have the opportunity to determine the work/life balance that suits you best.
Accounting Students
Perhaps it is your goal to become a CPA, whether you intend to work in a firm or eventually run your own business. During your time in school, there’s no reason not to put your skills and education to good use and earn a little money to reduce your student debt in the meantime.
You can take an online course over your summer break in order to become certified, allowing you the opportunity to work as needed to supplement student loans or even begin to pay them down. Tax preparation doesn’t have to be a full-time job – you can do it part-time while you’re in school by taking on just a few clients.
This is also great experience to add to your resume. It will not only help to prepare you for eventually becoming a full-fledged accountant, but it could help you to get a foot in the door when you finish school and start your career. Of course, you might just decide that the perks of being your own boss make you want to stick with tax preparation.
Professionals Seeking Seasonal Work
There are plenty of people interested in supplementing their income after the New Year in order to pay down debt accumulated during the busy holiday season. This would be a great time to use your certification in tax preparation to earn a little extra money on the side.
The turning of the calendar year also signals the beginning of tax prep season. As workers get their income tax forms in the mail, starting as early as January, they seek out skilled professionals to help them complete accurate and timely income tax returns so that they can get their refunds post haste.
As a tax preparer, you could probably work year-round, especially if you take on corporate clients that file quarterly estimated taxes. However, you could elect to limit your services to the busiest time of year – the months leading up to April 15 – in order to supplement your income seasonally.
Anyone Looking to Improve Job Prospects
It seems like the tax code becomes more and more incomprehensible each year, at least for the layman. This means that skilled tax preparers will always be in high demand.
If you have a head for numbers, an eye for detail, and a strong desire to improve your job prospects, there’s no reason you shouldn’t consider the benefits of enrolling in courses to become a successful tax professional. With the proper certification course you can quickly gain the knowledge and skill necessary to earn a living helping others prepare their taxes.
As a tax preparer, you should ask every new client to bring along a copy of last year’s return, and if available, of previous returns as well. This is especially necessary in the case of a taxpayer taking a depreciation deduction, since the depreciation rate should be consistent from year to year. Earlier returns should also give you a clue to additional deductions the taxpayer may be entitled to, or they may help you to point out possible deductions or tax saving opportunities that were missed. In the case of previous clients, you should have your own copies of previous returns to refer to.
From: Building, Marketing & Operating A Profitable Tax Practice (included in our Federal Income Tax Course)