Is your CPA preparing your taxes?
The straight answer to this is: no, probably not. But the good news is: they’re not outsourcing it like you fear. (Although, some CPAs will outsource outside of the country. On occasion, it’s even being outsourced to the tax-prep chain down the street.) Who’s doing your taxes, then? I hate to say it, but it’s people in the same position that I was in when I was an intern: the backroom.
You see, there are different tiers of folks out there who prepare taxes. Usually, in a medium to large office, there is a person who meets with you (a CPA), they talk with you, take notes, and tell you when to expect your taxes to be completed. As soon as you leave, though, they go back to their offices, and drop your taxes off along the way at the desk of an assistant. That person has the job of preparing your taxes. At that point, they might go back to the CPA for review, or they may go to a supervisor, who is not a CPA, but is a more experienced preparer, for review. He or she will look over the work that the the preparer has done and if it needs fixing (review notes) then it’ll go back to the preparer.
The prepare-and-review process will go on until the return is done to the satisfaction of the reviewer. At that point, the return is processed (copied and put in those pretty folders) and it goes to the CPA. The CPA may or may not look over it. (I’ve worked in offices where the CPA was diligent in looking things over and others where he or she wasn’t.) Then the CPA signs the return, you get a call, and your return is either there for you to pick up or is mailed to you. This is the process whether you insist that the CPA prepare your return him or herself or if you say nothing. There are pros and cons to this process.
Pro:
- It costs less: The CPA normally has a higher billing rate than the preparers and if the CPA prepares your return it would cost more. So it saves you money by having the preparer prep your taxes.
- You get the experience of a CPA without having to pay for it. The review process pretty much guarantees that you get the skills that a CPA has to offer without having to pay the billing rate.
Con:
- Even if you tell the CPA you only want them to prepare your return, you’re out of luck. They have busy schedules and they don’t have the time to do your taxes. Sorry, that’s the way business works.
- If the preparer loses an important piece of paper, your taxes might be wrong. There is no way for a reviewer to know if they’ve received everything. This is especially true if you have a new tax situation. But then. this is a risk you take no matter who you give your taxes to.