Tax preparers getting ready for after-first wave|[12/27/06]

Published 12:00 am Wednesday, December 27, 2006

Tracey Ware was like many college students who worked while attending college.

Where she decided to use some of the knowledge her college experience afforded her went hand-in-hand with what all Americans will have on their minds in a few short weeks – filing their income taxes.

Ware, who received her associate degree from Virginia College in Jackson last year, will oversee a staff preparing returns for clients.

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&#8220Some people think doing taxes is hard, but nowadays the software makes it easy,” Ware said, readying the Jackson Hewitt location on Halls Ferry Road she will help guide through another busy tax season.

The 2007 tax season will be Ware’s third as a tax preparer, but her first season working for Jackson Hewitt.

The Vicksburg native completed the New Jersey-based tax service’s 12-week training course that gets preparers acclimated with the latest version of tax software the company will use.

Ware estimates she and three first-time preparers will file about 1,000 returns at the Halls Ferry Road location alone.

Much of that will come during the peak filing time for people in Ware’s line of work – the final week of January and the first week of February. Known in the business as &#8220the rush,” it is the period around Jan. 31 when employers must have W-2 forms postmarked to send to employees. With those forms in hand, people expecting refunds or earned income tax credit checks, don’t want to wait.

Executives of companies who annually train preparers like Ware who do it for valuable office experience – and those who simply want to grow their knowledge of the often-maligned Internal Revenue Code – expect their tax pros to be ready for a busy season.

Classes are growing and becoming more diverse, said Mark Steber, vice president of tax resources for Jackson Hewitt in Sarasota, Fla., who helps design the curriculum for the company’s computer-based and in-person training classes.

&#8220It’s retirees and it’s college students,” Steber said, adding the training is &#8220hands-on.”

The software used by most companies who either purchase it from distributors or, like H&R Block, write their own, is getting more helpful to both preparer and taxpayer.

For example, the itemized deductions screen alerts the preparer to occupation-specific questions to ask clients who may be able to deduct expenses like medical bills and job-related costs not reimbursed by their employers.

Preparers have an incentive to come back after their first year to hone their knowledge because experienced preparers are needed in busy locations.

&#8220More experienced preparers can work through the tax season,” said Theresa Lorenz, district manager for H&R Block in Flowood, adding the usual breakdown of experienced preparers to first-timers from year to year is about half-and-half.

Wages for tax preparers vary from one business to another, with some paid an hourly rate and others receiving commission based on the total number of returns.

Lorenz predicted the company’s four Vicksburg locations will process 3,000 returns this tax season, an average of 750 per location.

Preparers at H&R Block train for 66 hours on the company’s self-produced software in classes beginning in August. If they are hired, Lorenz said, they take another 30 hours of classes through November.

Even with filing manpower, peak filing times are expected to bring long lines and rankled nerves for many who work long hours and must make time to ready their pertinent paperwork to file federal and state returns.

Lorenz assured H&R Block will be ready, with locations staying open 14 hours per day during the rush.

Interest has risen in tax schools since the rise of the Internet and electronic filing. According to the Internal Revenue Service, 73 million returns were filed electronically last year, with two-thirds of them filed by tax services who offer it.

Filing by computers in homes rose 18 percent in 2006, IRS Commissioner Mark W. Everson has said.

On the agency’s Web site, Everson said the number of returns filed electronically in 2006 exceeded the total number of paper returns processed in 1966.

Another trend that has paralleled the rise of electronic filing is advance loans on federal income tax returns. Commonly advertised by income tax services that cater to taxpayers who make less than $30,000 – typically the cutoff for credits such as the Earned Income Tax Credit – the option of &#8220going rapid” usually comes at greater cost to the taxpayer in the form of various processing fees to banks handling the refund once it is released by the government.

When preparation and electronic filing fees charged by a tax service are factored in, fees can total $200 or more, with the taxpayer receiving a check for the balance of the refund.

Rapid refunds are not available on returns from states, Mississippi and Louisiana included.