The Internal Revenue Code (IRC) is an ever-growing collection of federal statutes governing Internal Revenue Service (IRS) taxation of individuals, businesses and wealth transfers. To the untrained eye it looks like it was written in an indecipherable language that no one has spoken in several hundred years. Fortunately, tax accountants are trained to research, understand, interpret and translate the IRC—not to mention international, state and local tax laws—for the rest of us. Becoming a tax accountant requires only a bachelor’s degree in accounting, although master’s degree-level training in accounting or taxation is advantageous.
Entry-Level:
Entry-level certified tax accountants fill out individual or business tax returns. They are responsible for calculating a client’s earnings, filing any necessary documentation and providing clients with statements summarizing their tax liabilities. A newly minted tax accountant may work at a public accounting firm where she is responsible for handling several clients’ needs at one time. Responsibilities are often split up at larger firms. So, for example, one tax accountant may be in charge of preparing certain clients’ tax returns while one of her colleagues is responsible for calculating the same clients’ earnings. Our hypothetical recent graduate may also be employed at a company as an in-house tax professional who focuses on her employer’s handling of its tax matters and any related documentation. An in-house accountant may be less intimately familiar with the specifics of any one tax accounting function than, for example, a colleague who spends her days doing nothing but filling out tax returns for partnerships and limited liability companies (LLCs) at a public accounting firm. However, she will have the advantage of being more familiar with the breadth of the applicable tax laws and procedures involved in filing a comprehensive return for a single entity.
Senior-Level:
Senior-level tax accountants are typically asked to take a more theoretical approach to their clients’ needs. They often serve as consultants, helping clients map out and create their business plans, trusts and individual financial plans to minimize tax liability at the international, federal, state and local levels. Many senior accountants are responsible for performing and reviewing clients’ activities to ensure compliance with all applicable tax laws, rules and regulations. They also generally oversee teams of less experienced employees. This requires them to review tax returns that have been filled out (and sometimes to fill out a few of their own). On top of all these directly client-centered professional obligations, experienced tax accountants who serve as consultants must stay abreast of developments or changes in the tax law. Failure to do so could create much unwanted liability for clients, who are paying accountants to save them from exactly that. Thus, tax accounting consultants must monitor tax legislation, regulations and rulings to keep from running afoul of the law and to protect their clients’ interests.
In short, you should be thankful for tax accountants. Even if you do not personally employ one, they still make your life much simpler and more enjoyable than it would otherwise be.
