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A tax agent can refer to a government official who ensures citizens and businesses pay their taxes, or a professional who prepares taxes for a fee. Tax agents must be certified and can include CPAs and tax attorneys. They help clients save on taxes and prepare and submit tax returns.
The term “tax agent” can refer to two different professions, both related to taxes. In a sense, it is a person who represents the government in investigation and collection processes to ensure that citizens and businesses pay their taxes. The second meaning refers to a person who prepares taxes on someone else’s behalf, offering professional assistance to people and businesses who are unable or unwilling to prepare their taxes on their own. This article focuses on professional tax preparers, not government officials.
Taxation can be a complex topic, and in many nations the government allows tax agents to prepare taxes for a fee, often handling the submission process as well. In most places, tax agents must be certified by the government agency in charge of taxation. This is designed to prevent cases where people pose as tax agents and fail to prepare taxes properly because they don’t know how or use their access to personal financial information for fraudulent purposes. People looking for a tax agent can ask to see the person’s qualifications, including permission to practice from the government.
Certified public accountants, tax attorneys, and certain other types of professionals can act as tax agents. Many belong to professional organizations with their own certification programs and may use terms like “tax professional” or “tax preparer”. In some cases, people can only use a professional title if they are suitably qualified, and they can report fraudulent use of professional credentials to the parent organization.
The tax agent will ask clients to collect all financial documentation, including records on income and expenses. Many work with their clients to point out areas to save on tax returns and will ask a series of questions to determine whether someone qualifies for certain tax credits, deductions and other benefits. Especially for people who are not familiar with tax laws, this can be a valuable service as they can learn about the numerous savings available, such as tuition deductions, certain living expenses and other matters, depending on the country and tax year.
Once the tax agent is sure they have a complete picture of the client’s finances, they can prepare a tax return using this information. It confirms that the information is correct and calculates the total tax and the tax or refund due. Most will prepare federal and regional taxes at the same time, duplicating information on both sets of forms. When all forms are completed, the tax agent has the customer sign and submit them, usually electronically, for expediency.
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