BBB Tips on Finding a Tax Preparer
Tax season is here once again, and thanks to the demise of the so-called payroll tax holiday – which expired on December 31 – all workers will pay higher taxes in 2013. The Better Business Bureau of Minnesota and North Dakota (BBB) reminds people that it’s better to start gathering the materials you’ll need to file your 2012 tax return earlier rather than waiting until the last minute. And don’t forget, IRS rules say taxpayers are legally responsible for what’s on their tax return even if it is prepared by someone else, so it’s important to be selective when hiring an individual or firm to prepare your return.
“Most tax professionals provide quality service,” said Dana Badgerow, President and CEO of the Better Business Bureau of Minnesota and North Dakota. “Still, we have seen cases where businesses have closed suddenly or stopped communicating with their clients. It’s important to check out company track records and feel comfortable with the tax preparer you choose.”
The BBB offers the following advice on tax preparation and how to find a trustworthy tax preparer:
- Ask around. Get referrals from friends and family on who they use and check BBB reports on tax preparers and tax preparation services at www.bbb.org/search.
- Don’t fall for the promise of big refunds. Be wary of any tax preparation service that promises larger refunds than the competition, and steer clear of tax preparers who base their fee on a percentage of the refund.
- Look for credentials. Ideally, your tax preparer should either be a certified public accountant, a tax attorney, an enrolled agent or a certified E-file provider. Be sure to find out if the preparer is affiliated with a professional organization that provides or requires its members to pursue continuing education and holds them accountable to a code of ethics.
- Make sure they have a Preparer Tax Identification Number (PTIN). A PTIN must be obtained by all tax return preparers who are compensated for preparing or assisting in the preparation of, all or substantially all of any U.S. federal tax return, claim for refund, or other tax form submitted to the IRS.
- Investigate whether the preparer has any questionable history with your state’s Board of Accountancy (for CPA’s), the State Bar Association (for attorneys) or the IRS Office of Professional Responsibility (OPR) for enrolled agents.
- Remember that a Paid Preparer is required by law to sign your return and fill in the preparer areas of the form. They should also include their appropriate identifying number on the return. In addition, the preparer must give you a copy of your return.
- Think about accessibility. Many tax preparation services only set up shop for the months leading up to April 15. In case the IRS finds errors, or in case of an audit, you might need to be able to contact your tax preparer throughout the year; be sure to find out how you would do so.
- Read the contract carefully. Read tax preparation service contracts closely to ensure you understand issues such as how much it is going to cost for the service, how the cost will be affected if preparation is more complicated and time consuming than expected and whether the tax preparer will represent you in case of an audit.
- Don’t forget about Free File. If your income is $57,000 or less, Free File offers free Federal tax preparation and e-filing. It's available only through IRS.gov, where a number of tax software companies make their products available for free. Some also support state tax returns for free. http://www.irs.gov/uac/Free-File:-Do-Your-Federal-Taxes-for-Free.
For more assistance in finding professionals you can trust, visit bbb.org/us/bbb-accredited-businesses/.
Don’t Let Paperless, E-Receipts Compromise Your Personal Information
Have you ever opted for a paperless, e-receipt? Some retailers and banks have started offering customers the option of receiving receipts from purchases and ATM transactions via email. While this is a convenient alternative to paper clutter, the Better Business Bureau of Minnesota and North Dakota (BBB) is reminding shoppers to protect their identity in the process.
Many retailers offer e-receipts for both our convenience and theirs. E-receipts save retailers money, and they make it easier for you to electronically file them away until they’re needed for returns, warranties or taxes.
E-receipts can often be tied to your store affinity card, but you can often opt for paperless simply by providing your email address to the clerk at the time of purchase.
There are also online companies that offer to organize and store digital receipts. You must create an account and provide your credit or debit card information, which the company uses to track transactions. After purchases, the company retrieves receipt information directly from retailers and stores it online. But be cautious! Obviously this kind of service is ripe for scammers to mimic in order to steal your information.
For shoppers who are interested in opting for the paperless, e-receipt, BBB offers the following tips:
Find out how the business plans to keep your information secure. You’ll want to check to see if the business plans on selling your information to third-parties. If they do, be on the lookout for unsolicited emails requesting your personal information; they could be scams that download malware on your computer.
Ask if you can opt-out of receiving promotional emails. Now that the business has your email address, it’s possible you’ll start to receive coupons, newsletters and other promotional emails from them…and even from others if they’ve sold or shared your data. You may want to set up a separate email address to use for paperless receipts so that you can easily monitor it for spam.
Beware of scams! Having receipts emailed can also make you susceptible to phishing and other identity theft scams. Scammers pose as retailers or banks with realistic-looking emails that may claim there are problems with your purchase and request that you click a link to fix it. The link may take you to a fraudulent site that asks for your personal information, or it might download malware on your computer that will search your hard drive for account numbers and passwords.
Make sure your anti-virus software is up-to-date. Whether or not you plan to increase your Internet and email use, it’s always a good idea to make sure your system’s security plan is updated regularly. Spammers feed off of online shoppers who fail to update their security patches.
Three Things You Need to Know Before Investing
Investments take risk; sometimes a little, sometimes a lot. But smart investors know that the best way to minimize risk is to educate yourself about your basic rights, the protections you are entitled to under the law, and the common scams and frauds to avoid. The Better Business of Minnesota and North Dakota (BBB) Bureau has teamed up with the FINRA Investor Education Foundation to bring you up-to-date research and tools on investment fraud at BBB Smart Investing.
Studies have shown that investment scams have risen in the last decade. Baby Boomers are managing their own retirement funds and are particularly vulnerable. In 2011, according to the North American Securities Administrators Association (NASAA), state and provincial regulators in the U.S., Canada and Mexico launched more than 2,600 administrative, civil and criminal enforcement actions involving investors, 1 in 5 of whom were seniors.
The BBB and the Financial Industry Regulatory Authority (FINRA) suggest three key steps to take before investing:
Check out the seller. A legitimate investment professional must be licensed. Before giving out your personal information, ask whether the seller is registered with FINRA, the Securities and Exchange Commission (SEC) or your state securities regulator. Find registration and other information on individual brokers, securities firms and investment advisor firms at:www.SaveAndInvest.org/CheckSeller.
Ask questions. Are they licensed? Is this investment registered with the SEC?
Check out the investment. Check whether the investment itself is registered. Confirm whether a security is registered with the SEC and get access to a company’s financial information by using the SEC’s EDGAR Database. Learn how at www.SaveAndInvest.org/CheckInvestment.
Is a Smartphone Credit Card Processor Right for Your Business?
Gone are the days of having to rely on your “brick and mortar” store to drive shoppers to your business. These days, traveling retailers can make a sale with just the touch of a button and the swipe of a credit card via their smartphone. Using smartphone credit card readers, businesses have the capability of taking their sales to the next level, but the Better Business Bureau of Minnesota and North Dakota (BBB) is advising business owners to make sure that such a system is right for their business.
The BBB recommends the following tips for businesses considering implementing smartphone credit card readers:
Do your research. Just like a landline-based credit card system, you’ll need a merchant account to process payments, a scanner device to read the card, and software (app) to make it run. Don’t skimp on research. Start with your bank or your credit card service for suggestions on recommended services and devices. Check out all vendors at bbb.org. Ask for references.
Choose the right combination. Your smartphone merchant account might interface with your existing landline-based account, and that will make life easier. Build from there; find the app you feel comfortable using that has the features you want. There are over a hundred apps available for different smartphones; each is usually compatible with a number of different swiping devices. The reader itself is the last step (and the easiest to replace or exchange).
Read the fine print. Using a smartphone credit card reader might be a great way to increase your sales while on the road. However, make sure to read the fine print for the smartphone app to make sure that you won’t be charged while you’re not using it.
Offer the customer service your shoppers expect. Some shoppers may not be familiar with this kind of payment method. Be sure to offer them the option of having a receipt emailed to them, or even offer to print the receipt there with a separate smartphone printer. This will reduce the hassle should your customer want to return the product.
Beware of scams! As with any emerging technology, scammers are figuring out how to exploit vulnerabilities. Don’t buy the devices or apps from vendors you don’t know.
The mission of the Better Business Bureau is to be the leader in building marketplace trust by promoting, through self-regulation, the highest standards of business ethics and conduct, and to instill confidence in responsible businesses through programs of education and action that inform, assist and protect the general public. We are open 8 a.m. to 5 p.m. Monday through Friday. Contact the BBB at bbb.org or 651-699-1111, toll-free at 1-800-646-6222.