Becoming a Tax Accountant



Becoming a Tax AccountantBy: Dan McLean Table of Contents TOC \o "1-3" \h \z \t "Style1,1,Style2,2" Table of Contents PAGEREF _Toc373694778 \h iiiIntroduction PAGEREF _Toc373694779 \h vJob Description and Duties PAGEREF _Toc373694780 \h 1Major Responsibilities & Duties: PAGEREF _Toc373694781 \h 1Requirements PAGEREF _Toc373694782 \h 3Career Opportunities PAGEREF _Toc373694783 \h 5Employer Organizations include PAGEREF _Toc373694784 \h 5Tax Accountant Salary and Job Outlook PAGEREF _Toc373694785 \h 7Job Prospects PAGEREF _Toc373694786 \h 7International accounting PAGEREF _Toc373694787 \h 9Individual Tax Return Form 1040 PAGEREF _Toc373694788 \h 10Step 1: Label PAGEREF _Toc373694789 \h 10Step 2: Filing status PAGEREF _Toc373694790 \h 10Step 3: Exemptions PAGEREF _Toc373694791 \h 10Step 4: Income PAGEREF _Toc373694792 \h 10Step 5: Total Income PAGEREF _Toc373694793 \h 11Index PAGEREF _Toc373694794 \h 13References PAGEREF _Toc373694795 \h 15IntroductionAccounting is not an easy profession by any means. Much of the work dealt with by accountants are the things no one else wanted to do, which is why there is a demand for the specific skill set required. Tax accountants specialize in preparing taxes for private individuals, private and public companies including non-profits, and in some cases, government entities. Tax accountants also create tax strategies XE "strategies" to reduce the amount of taxes a client owes while remaining compliant with generally accepted accounting principles XE "principles" and the law. Tax accountants must interpret and understand tax law, and must occasionally explain tax law and its implications to clients. Common responsibilities for tax accountants include preparing and filing taxes, financial planning XE "planning" , attending and participating in strategy meetings with clients and others, preparing presentations and reports on tax situations, reporting, and law, and researching and reviewing past tax filings.3098800203200This manual will provide a better understanding of what a Tax Accountant does in daily operations XE "operations" , as well as give insight into the steady field of opportunity for accountants. Job Description and DutiesYour first responsibility XE "responsibility" is to know your own duties and how to do them promptly, correctly and pleasantly. Secondly, you will be expected to cooperate with management and your fellow employees and maintain a good team attitude. How you interact with fellow employees and how you accept direction can affect the success of your department. In turn, the performance of one department can impact the entire service offered. Whatever your position, you have an important assignment: perform every task to the very best of your ability. The result will be better performance for the company overall, and personal satisfaction for you. Tax accountants prepare federal, state and local tax returns for businesses, organizations and individuals. As such, these professionals are knowledgeable on business concepts and government regulations.?Tax accountants?may advise clients on how to minimize tax liability, inform them of any tax changes that affect their business and ensure compliance with taxing agency requirements. Tax accountants are involved in any disputes or audits that affect their clients.Major Responsibilities XE "Responsibilities" & Duties: Implement client’s engagements from start to finish (planning XE "planning" , executing, directing, and completing tax projects). 4010025133985Manage engagements budgets. Supervise, train, and mentor staff and interns on tax projects. Review tax returns prepared by staff and make recommendations regarding accuracy and tax savings opportunities. Prepare more complex tax returns for individuals, trusts, partnerships, and corporations. Proactively interact with key client management to gather information, resolve tax-related problems, and make recommendations for business and process improvements. Assist partners on proposals and business development calls. Gain understanding of client operations XE "operations" , processes, and business objectives. Possess an understanding of state and foreign tax issues. Tax accountants assist clients with their financial and income XE "income" statements. These professionals may have typical work weeks, except around tax season when their hours can increase significantly. The basis behind the revenue line of tax accountants is that they provide value to an organization by making their business more efficient. They do this by adding to the client’s baseline in tax preparation. As you can see, tax accountants are highly specialized in their field of study. They bring economic worth by providing a service to an ever changing tax law. Companies will invest their money into accounting services rather than try to spend hours and labor running through tax documents and abiding by rules and regulations. The highly specialized characteristic of accountants poses an issue. What are the next steps in education XE "education" in my pursuit of accounting? RequirementsBuilding your education XE "education" properly and timely is crucial to the success and betterment of your career. To become a tax accountant, individuals must obtain a bachelor’s degree in accounting, preferably with a concentration in tax and tax law. Many professional tax accountants also pursue a Master’s in Taxation or Audit as well as organizational or state level certifications. Widely recognized certifications that can help tax accountants become competitive in the job market include Certified Public Accountant, Certified Financial Planner, and Enrolled Agent. Since a position as a tax accountant involves a high level of responsibility XE "responsibility" and can have a major impact on a business’ finances, a growing number of companies also require tax accountants to have obtained tax compliance experience in addition to holding an accounting degree and/or certification. A base level outline of education XE "education" should take into consideration: Bachelor’s degree in accounting Master’s degree with concentration in TaxCPA certification (Certified Public Accountant)CFA certification (Chartered Financial Analyst)JD (Juris Doctor) : if proceeding further into tax field1 & 2: In order to find a school best fitting for your desires, you’ll need to take campus tours, research their school of business, talk to current students as well as alumni and get your questions answered. Most schools offer an accounting degree, however when choosing a school for post grad work you’ll need to consider what specializations they offer in concurrency with your perused field. 3: The CPA exam is rigorous in nature and has a very low pass rate. Whereas the BAR exam for lawyers has around a 50% pass rate, the CPA usually passes 18% on the first attempt. The review courses offered will help with studying and preparing for the CPA exam, however you must complete 150 hours and 2 years of experience before being able to sit for the exam. These requirements make the certification something highly sought over and distinguishable among other candidates. 4: The Chartered Financial Analyst credential has become the most respected and recognized investment designation in the world; enrolling in the CFA Program is your first step toward earning this qualification. The CFA covers concepts and skills you will use at all stages of your career, bridging academic theory, current industry practice, and ethical and professional standards to provide a strong foundation of advanced investment analysis and real-world portfolio management skills. 5: The JD (Juris Doctor) is the degree commonly conferred by law schools. It is required in all states except California (which includes an option called law office study) to gain?Admission to the Bar. Gaining admission to the bar means obtaining a license to practice law in a particular state or in federal court. The specific requirements for a J.D. vary from school to school. Generally, the requirements include completing a minimum number of class hours each academic periodCareer OpportunitiesTax accountants can work directly for a business or organization, work as a tax consultant or advisor through a public accounting firm, or work as a self-employed tax accountant. Firms large and small need tax accountants to prepare, audit, and plan their tax filings. Not surprisingly, government agencies like the Internal Revenue Service also hire tax accountants. Tax accountants can start a career with the?Internal Revenue Service?to gain work experience at a competitive salary with great opportunities for advancementEmployer Organizations include3745762176988KPMGDeloittePriceWaterhouseCoopersIRSGrantThorntonErnest&YoungBakerTillyVirchowKrouse, LLPUniversitiesLocal and public firmsPrivately owned and operated companiesAccording to the U.S. Bureau of Labor Statistics (BLS), employment for accountants and?auditors?was expected to increase by 16% from 2010 to 2020 (). The increase is due to stricter regulations and a need for accountants to handle compliance matters.2748280187325-1485901492251597985106931Tax Accountant Salary and Job OutlookOverall, the US Bureau of Labor Statistics reports that accountants and auditors make an average salary of $61,690 per year. However, specialized careers in accounting like tax accountancy could well lead to a higher than average salary, as data compiled by Robert Half Finance & Accounting found that recent starting salaries for tax accountants range between $51,000 and $70,250 per year,?and are set to increase considerably in coming years. As the globalization of marketplaces continues, knowledgeable tax accountants are expected to be in high demand, especially those who have professional designations speaking to their expertise. The top paying industries at that time were securities and commodity exchanges and the federal government.Accountants and AuditorsMedian annual wages, May 2010Accountants and Auditors$61,690Business and Financial Operations Occupations$60,670Total, All Occupations$33,840There has been an increased focus on accounting in response to corporate scandals and recent financial crises. Stricter laws and regulations, particularly in the financial sector, will likely increase the demand for accounting services as organizations seek to comply with new standards. Additionally, tighter lending standards are expected to increase the importance of audits, as this is a key way for organizations to demonstrate their creditworthiness.Job ProspectsAccountants and auditors who have earned professional recognition, especially as a Certified Public Accountants (CPA), should have the best prospects. Job applicants who have a master's degree in accounting or a master's degree in business with a concentration in accounting also may have an advantage. Competition should be strong for jobs with the most prestigious accounting and business firms. The continued globalization of business should lead to more demand for accounting expertise and services related to international trade and international mergers and acquisitions.International XE "International" accounting The Next surge of accounting practice occurs in the specialization of international accounting. International XE "International" Tax Accountants are a specific type of accountant who specializes in international tax law. International Tax Accountants are employed by large corporations, international companies, tax consultancies and accounting firms; International Tax Accountants may also be self-employed and own their own practice or firm. Common duties of International Tax Accountants include researching tax law, preparing tax returns, completing tax forms, meeting with clients and other duties as necessary.The Security XE "Security" and Exchange Commission would like to move toward a single international accounting standard opposed to our GAAP (generally accepted accounting principles XE "principles" ) we use here in the United States. Doing so would provide transparency to international investors and provide relevant and relatable data across the economy. 1771015711835A quote taken from “With the activities and interests of investors, lenders and companies becoming increasingly global, the Commission is increasing its involvement in a number of forums to develop a globally accepted, high quality financial reporting framework” shows the increased focus on international reporting and possibly the way the occupation is headed.Individual Tax Return Form 1040Box by Box, step by step guide to filling out a basic 1040 statement of income XE "income" tax return 2118360100330Step 1: Label Fill in the information requested, including your first name, middle initial and last name. Joint filers must each fill in this information. Then add your home address, including ZIP code. And don't forget your Social Security XE "Security" number (numbers, for married couples) in the boxes provided at the upper right-hand corner of the form.Step 2: Filing status -125095410210You get five choices, one each on lines 1 through 5: single, married filing jointly, married filing separately, head of household and qualifying widow or widower with a dependent child. Each has specific requirements and offers different tax advantages. Also, the standard deduction amount is different, as is the final tax due.Step 3: Exemptions 1953895727075Next, you start cutting away at your impending tax bill. The exemptions section of the form (line 6 and all its sublines below) lets the IRS know how many people depend on you for support. Technically, if you're married filing jointly, your spouse isn't your dependent. But when you file, each of you is counted as an exemption, so check boxes 6a and 6b. Later in the filing process, this will help reduce your taxable income XE "income" .Step 4: Income162560280035Now to the main reason the IRS wants a form from you: Just how much money did you make last year? This is where you enter in the proper monetary income XE "income" from Wages, Interest income, Dividend Income from the prior year.Step 5: Total Income1597660118745This next section of the 1040 allows you to adjust your income XE "income" by taking several above-the-line deductions. By taking all these deductions you can, you'll cut your adjusted gross income. That, in turn, cuts your overall bill because figuring your AGI is the first step in arriving at your final taxable income amount.After 70 line items entered into the Form 1040 you will receive your refund amount. This is the single line item that drives the tax accounting industry. Hidden ways to deduct income XE "income" and itemize certain assets is the key to complex tax issues.Index INDEX \c "1" \z "1033" education, 2, 3, 15income, 1, 10, 11International, iii, 9operations, v, 1planning, v, 1principles, v, 9Responsibilities, iii, 1responsibility, 1, 3Security, 9, 10strategies, vReferences XE "education" -articles/Tax_Accountant_Career_and_Salary_Information.html ................
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