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Accounting, CPA, Tax Preparer: Tax Question?


After looking at a certain user's credentials, it made me question it because it really doesn't make sense. The person had 24+ years of accounting, 14+ years of CPA, and 7+ years of tax preparation experience. So why is it that you can do tax returns as a accountant and not be licensed as a tax preparer? It seems a little backwards to me. I mean you should be licensed to prepare taxes before you could be a CPA and a CPA before you could be an accountant.

That's just my two cents.

You can be an accountant just by working in the field and getting on the job experience. The CPA credential is given by state boards in order for the holder to give an opinion on financial statements. That is the only purpose of the CPA designation. This is why the person had so many years as a CPA without the same years of tax experience. Taxes are secondary to us CPA's as our main job is protecting users of financial statements. Most CPA's make their big money from audits and consulting, not tax work. Just about anybody can do tax work. However, only Tax Attorneys, CPA's, and EA's can argue in front of the IRS.

An accountant is a general term for a professional who helps keep financial records and/or make sure taxes are paid properly. They may or may not be certified as a public accountant, i.e. have a CPA. CPA is a professional designation that's regulated by states.

A book keeper is a more narrow, basic, entry-level job in accounting. It's somebody who records transactios. They might also prepare basic financial reports, make bank deposits, balance accounts, handle payroll, prepare and send invoices, etc. An accountant could do all this and more.

You do not have to provide evidence of training or competence to prepare tax returns except in California and Oregon. In those states you have to have education and pass an examination unless you are an attorney, CPA or enrolled agent. These three classifications are already licensed and presumed to be competent.

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