Counting on Your Tax Refund to Pay for Tax Preparation?

In Accounting & Finances, Business, Taxes on July 9, 2011 by Sufen Wang Tagged: , , , , ,

Prepare to Be Disappointed…

Out of sight, out of mind is not always a good idea – at least when it comes to paying for your tax preparation. The IRS seems to agree. David Williams, the director of the IRS return preparer office, announced on June 28 that the Service would not pursue the option of allowing taxpayers to use a portion of their tax refund to pay for tax preparation services.

The concept was originally proposed last year and would have offered taxpayers an alternative to extra number-crunching and out-of-pocket expenses during the already-stressful tax season. However, “Since then, the IRS has conducted outreach to numerous parties, including consumer advocates and industry groups,” Williams said. “During that outreach, the IRS heard a variety of views, some supporting this additional option for consumers, with others raising operational and/or policy concerns.”

Consumer groups especially opposed the idea because “predatory tax preparers” might take advantage of the fact that a taxpayer’s refund is not as visible or accessible once it has been turned over to the preparer. They could then charge more for tax preparation without their client’s knowledge.

The Service’s decision to reject the option won’t do anything to help the headaches that arrive during tax-preparation time. On the other hand, at least taxpayers won’t have to worry about their preparers taking more than their fair share.

Just remember that tax preparation costs money, any way you look at it, and sometimes it’s best not to delay the inevitable.

On the Money,
Sufen Wang
Wang Solutions

One Response to “Counting on Your Tax Refund to Pay for Tax Preparation?”

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