How to choose a US expat tax preparer
Contributed by Bright!Tax
10 August, 2015
All US citizens and green card holders have to submit an annual tax return to the IRS no matter where they live, and since the FATCA law was passed in 2010, US expats are also obliged to declare their foreign income and assets, along with their foreign bank accounts. For many people, the extra burden and complication isn't worth the time and trouble, and they turn to one of the specialist companies that prepare expat tax returns day in day out. So how should you set about choosing your expat tax preparer?
Firstly, definitely go with a specialist. Expat taxes can be convoluted, especially if there are several years' worth to catch up on, and including FATCA and FBAR requirements. Many expat situations go beyond the day to day experience of most US accountants. There are a number of online firms though that deal solely with expat taxes, and it makes sense to use an expert rather than with someone with limited experience in this specialist area.
The first step is a little online research. Type 'US expat tax preparation' into Google, then make a note of the several specialist expat tax preparation companies that come up on the first page. These are the most established specialists.
Next, contact them, briefly summarizing your situation and requirements, to see how they respond and what they would charge you. By comparing their responses you'll be in a position to make your decision, based on the following:
How did they answer?
Did they reply promptly and helpfully? Also, their answer should be positive rather than offish or overly impersonal in tone, and it should address the details. For good specialist expat tax preparers, no one's situation is very problematic. The tone of their reply may well set the tone for your experience should you choose to go with them.
How big are they?
This will give you an indication of how experienced they are. You should ideally aim for a medium sized firm, large enough to have a global presence, but not so big that they lack a personal touch and have high overheads and so higher costs. You should be able to get a good indication from their website, what comes up when you Google them, and from their social media activity.
How open and transparent are they?
Preparing expat tax returns is not a dark and secretive art. It is your personal situation, and you'll share your personal info with them, and they should be similarly open and transparent in return. Feel free to ask them about the process and about their business, and expect clear, honest responses.
If possible, look at reviews by their existing and previous clients.
Do they use tax specializing CPAs, or EAs (Enrolled Agents)?
EAs complete an 18 week course to gain their certification, while CPA certification takes several years! Ask who will actually prepare your return to check that they use experienced, tax specializing CPAs.
While the cheapest isn't necessarily the best of course, neither is it the case that the highest cost necessarily signifies the best service. Expat tax preparation companies should be able to give you a clear estimate of the cost in advance, once you have provided them with some details about your situation. Cost should be a factor but not the sole factor in your decision; arguably the others outlined above should carry more weight.
Whichever company you settle on, you should expect them to provide a smooth and predictable experience that takes the weight off your shoulders without costing you the earth.
Bright!Tax specialises in taking the stress out of US expat tax returns. If you have any questions, or would like some advice, contact us here and we'll be happy to help, or you can see our pricing here.
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