A new career in income tax preparation could be a safety net for some of the thousands of bank and financial services employees who are losing their jobs due to the current economic crisis. Many of those being laid off are older employees who would not be able to find another comparable full-time job, but are not ready to retire.Tax professionals need many of the same qualifications that bankers and financial professionals possess. A tax preparer must be able to conduct a thorough interview to extract financial and personal information from their client and hold that information in complete confidence. Preparing income tax returns requires similar skills as completing banking, mortgage or investment documents.
These jobs all require attention to detail, the ability to understand and interpret complex rules, and to work with numbers and software programs. Good people skills and professionalism are also prerequisites. However, knowledge of accounting and math are not necessary to become a preparer. Preparing individual tax returns involves only basic arithmetic.
Today more than ever, people are relying on paid tax professionals to handle their income tax preparation and other business affairs. Even with tax preparation software in full force, there is increasing demand for tax professionals.
More than 75 million individual taxpayers use a paid preparer every year, as the tax laws continue to become more complicated. Shorter deadlines, competing priorities, endless meetings, wireless Internet, and cell phones all contribute to creating a more time-starved world. As we struggle with managing the elusive resource of time, coupled with ever-changing tax laws, delegation of tax preparation becomes a higher priority.
Many people are turning to professional tax preparers for assistance.
E-filing, automation and even demographic changes have also created new opportunities in the tax preparation industry. However, there has been a shortage of qualified seasonal tax professionals due to increased competition and the low unemployment rates we have enjoyed in recent years.
Tax preparation can be a very lucrative seasonal career, either as an employee of a tax or accounting firm, or as an independent tax practitioner - a veteran tax professional can earn up to $100 per hour or more during tax season.
Tax preparation can also be combined with other professions, such as bookkeeping and financial services, to create year-round employment or self-employment, if desired.
Charles E. McCabe is CEO of the Virginia-based Peoples Income Tax Inc. and the Income Tax School.
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