Thinking about becoming a professional tax preparer? Whether you’re exploring a new career, looking for a seasonal income opportunity, or interested in starting your own business, tax preparation offers several paths into the financial services industry.
You don’t necessarily need an accounting degree or years of financial experience to get started. With the right training, an understanding of IRS requirements, and professional tax preparation tools, you can begin building the skills needed to prepare tax returns for clients.
In this guide, CrossLink University explains what tax professionals do, how much they earn, what qualifications are required, and the steps you can take to start your career in tax preparation.
What Is a Tax Professional?
A tax professional is someone who helps individuals or businesses understand, prepare, and manage their tax obligations.
One of the most common entry-level roles is a tax preparer, a professional who prepares federal and state income tax returns for clients.
Tax preparers review financial documents, identify applicable tax deductions and credits, calculate tax liabilities or refunds, and help clients file accurate tax returns.
Tax professionals may work independently, operate their own tax preparation businesses, or work for established tax offices, accounting firms, and financial service providers.
What Does a Tax Preparer Do?
The responsibilities of a professional tax preparer typically include:
- Collecting client information: Reviewing income documents, identification, expenses, and other financial records.
- Preparing tax returns: Entering information into professional tax preparation software and completing required tax forms.
- Identifying deductions and credits: Helping clients claim eligible tax benefits based on their financial circumstances.
- Reviewing returns for accuracy: Checking calculations, verifying information, and addressing potential errors.
- Filing tax returns: Submitting completed returns electronically when authorized to do so.
- Communicating with clients: Explaining tax return results, answering questions, and helping clients understand their filing responsibilities.
As tax professionals gain experience and qualifications, they may expand into business tax preparation, tax planning, or other specialized services.
How Much Do Tax Preparers Make?
The median annual wage for tax preparers in the United States was $54,920 in 2025, according to wage data from the U.S. Bureau of Labor Statistics.
Actual earnings depend on experience, location, employment arrangements, services offered, and whether a preparer works seasonally or throughout the year.
Tax Preparer Salary in the United States
| Earnings Level | Annual Wage |
| Lower 10% | $33,760 |
| 25th percentile | $38,910 |
| Median | $54,920 |
| 75th percentile | $76,300 |
| Upper 10% | $99,270 |
Source: U.S. Bureau of Labor Statistics, May 2025 Occupational Employment and Wage Statistics, as reported by ONET. These figures represent employee wage estimates, not guaranteed earnings or independent business revenue.*
Can You Make Money Preparing Taxes Part-Time?
Yes. Tax preparation can be performed as seasonal or part-time work, particularly during the annual income tax filing season.
Some tax professionals prepare returns alongside another job, while others work full-time or build businesses that provide services throughout the year.
For independent tax preparers, potential revenue depends on the number of clients served, the fees charged, and the types of returns prepared.
For example, a tax preparation business that completes 150 returns at an average preparation fee of $250 would generate $37,500 in gross preparation revenue.
This is an illustrative calculation, not an industry earnings average. Expenses such as software, insurance, marketing, staffing, and taxes would reduce the amount retained by the business owner.
Do You Need a Degree to Become a Tax Preparer?
No. A college degree is not generally required to become a paid federal tax return preparer in the United States.
The IRS does not require every paid tax preparer to hold an accounting degree, CPA license, or Enrolled Agent credential.
However, anyone who prepares or substantially assists in preparing federal tax returns for compensation generally must obtain a valid Preparer Tax Identification Number (PTIN).
Some states have additional registration, education, testing, or licensing requirements.
Although a degree may not be necessary, tax education is important. Professional tax preparers must understand tax rules, recognize potential filing issues, and accurately apply tax laws to individual client situations.
What Skills Do You Need to Become a Tax Preparer?
Successful tax preparers typically develop several important skills:
- Attention to detail: Tax returns require accurate financial information and careful review.
- Basic math and financial literacy: Understanding income, expenses, calculations, and tax-related documents.
- Communication: Explaining financial information in a way clients can understand.
- Organization: Managing client documents, appointments, deadlines, and tax returns.
- Technology skills: Using professional tax software and secure document management tools.
- Problem-solving: Researching tax questions and identifying the correct treatment of different financial situations.
- Professional ethics: Protecting sensitive client information and following applicable tax preparation rules.
These skills can be developed through education, practice, and hands-on experience.
How to Become a Tax Preparer: 7 Steps to Get Started
Starting a career in tax preparation involves learning the fundamentals, meeting applicable requirements, and developing a reliable process for preparing client returns.
Step 1: Learn the Basics of Income Tax Preparation
Before preparing returns for paying clients, begin by understanding how the federal income tax system works.
Important beginner topics include:
- What income taxes are and how they are calculated
- What Form 1040 is and how it works
- The different tax filing statuses
- The difference between tax deductions and tax credits
- How W-2 and 1099 income is reported
- What dependents are and how eligibility is determined
- How tax refunds and balances due are calculated
- How electronic tax filing works
Learning these fundamentals gives you a foundation for understanding more complex tax situations.
Start learning with CrossLink University.
CrossLink University provides educational resources designed to help aspiring and experienced tax professionals develop their knowledge of the tax preparation industry.
Step 2: Understand Tax Preparer Requirements in Your State
Before beginning paid tax preparation, research the requirements that apply where you intend to work.
Although the IRS does not require a general federal tax preparer license, certain states regulate paid tax preparers through registration, education, examinations, or licensing.
Requirements can vary based on your location and professional credentials.
Always verify the current rules with the appropriate state agency before offering paid tax preparation services.
Step 3: Obtain Your Preparer Tax Identification Number (PTIN)
A Preparer Tax Identification Number (PTIN) is an identification number issued by the IRS to individuals who prepare or substantially assist in preparing federal tax returns for compensation.
Most paid federal tax return preparers must have a valid PTIN.
To obtain one:
- Visit the official IRS PTIN website.
- Create or access your online account.
- Complete the application with the required information.
- Pay the applicable fee.
- Receive your PTIN and maintain it through annual renewal.
For the 2027 PTIN year, the IRS lists an application and renewal fee of $18.75.
A PTIN is generally valid for one calendar year and must be renewed annually.
Apply for a PTIN through the IRS
Step 4: Complete Tax Preparation Training
While there is no universal federal education requirement for all paid tax preparers, training is strongly recommended before preparing returns for clients.
Beginner tax preparation education should cover individual income tax returns, common tax documents, filing requirements, tax credits, deductions, and return review procedures.
Training may be available through tax education providers, community colleges, professional organizations, and employer-sponsored programs.
Another option is the IRS Annual Filing Season Program (AFSP), a voluntary program that recognizes certain non-credentialed tax preparers who complete continuing education requirements.
The standard AFSP pathway generally requires 18 hours of qualifying continuing education, including federal tax law, a refresher course with a test, and ethics education. Certain exemptions apply.
Learn about the IRS Annual Filing Season Program
Step 5: Learn How to Use Professional Tax Preparation Software
Professional tax preparation software is one of the primary tools used by tax professionals.
Tax software helps preparers organize taxpayer information, complete required tax forms, calculate tax results, review returns, and facilitate electronic filing.
When learning tax preparation software, focus on understanding the entire return preparation process rather than simply entering numbers into fields.
Important capabilities to become familiar with include:
- Client information and document collection
- Tax form entry and calculations
- Deductions and credits
- Error checking and return review
- Electronic filing procedures
- Client document management
- Data security and secure client communication
CrossLink provides professional tax preparation software for individual and business returns, along with educational resources that support tax professionals as they develop their skills.
Explore CrossLink Tax Preparation Software
Step 6: Decide How You Want to Work as a Tax Preparer
There are several career paths available in professional tax preparation.
Work for an established tax preparation business. Joining an existing office may provide opportunities to gain experience with client interactions, tax preparation procedures, and professional software.
Become a seasonal tax preparer. Some professionals focus on preparing individual tax returns during filing season.
Start your own tax preparation business. Independent tax professionals can establish their own offices, build client relationships, and determine the services they want to offer.
Expand into specialized tax services. With additional education, credentials, and experience, tax professionals may pursue business tax preparation, tax planning, or representation services.
Each path has different responsibilities, expenses, and opportunities for professional growth.
Step 7: Prepare for Your First Tax Season
Before accepting paying clients, make sure you have the necessary knowledge, registrations, tools, and procedures in place.
A new tax preparer should understand how to:
- Verify client identity and collect required information.
- Recognize when additional documentation is necessary.
- Prepare and review common individual tax returns.
- Follow applicable paid preparer due diligence requirements.
- Protect taxpayer information.
- Explain the filing process and obtain required authorizations.
- Correct errors and handle rejected electronically filed returns.
If you plan to electronically file returns through your own tax business, you will generally need to become an Authorized IRS e-file Provider and obtain an Electronic Filing Identification Number (EFIN). If you work for an established provider, the filing arrangement may be different.
An EFIN is separate from a PTIN.
Learn how to become an IRS Authorized e-file Provider
How Much Does It Cost to Become a Tax Preparer?
The cost of starting a tax preparation career depends on whether you plan to work for an established employer or operate your own business.
For someone joining an existing tax office, startup costs may be relatively limited.
Individuals starting their own businesses may need to budget for:
| Expense | What to Consider |
| PTIN | Annual IRS registration fee |
| Tax preparation education | Training courses and educational resources |
| Professional tax software | Software licensing and related services |
| Business registration | Applicable state and local business requirements |
| Computer and equipment | Reliable computer, internet access, and office equipment |
| Data security | Secure storage, cybersecurity protections, and written security procedures |
| Insurance | Coverage appropriate for the services and risks of the business |
| Marketing | Website, advertising, and client acquisition |
The total cost can vary significantly depending on your business model.
Before purchasing software or establishing an office, develop a basic budget and identify the services you plan to offer.
Can You Start Your Own Tax Preparation Business?
Yes. Many professional tax preparers choose to operate independently rather than work for an established tax preparation company.
Starting a tax preparation business allows you to build your own client base, establish your service offerings, and manage your business operations.
However, business ownership also brings responsibilities beyond preparing returns.
You may need to establish a business entity, meet registration requirements, obtain an EFIN, select professional software, implement appropriate data security procedures, and manage customer relationships.
What Do You Need to Start a Tax Preparation Business?
A basic business launch plan should address:
- Business structure: Determine how your business will be organized and registered.
- IRS requirements: Obtain the appropriate PTIN and, when applicable, EFIN.
- Tax knowledge: Complete training and develop competence in the returns you plan to prepare.
- Professional software: Select software appropriate for your expected clients and return volume.
- Security and compliance: Establish procedures for protecting taxpayer data and meeting applicable requirements.
- Client experience: Develop an organized process for appointments, document collection, preparation, review, and filing.
- Marketing: Create a plan to introduce your business and attract clients.
A successful tax preparation business requires more than software and registrations. It also requires accuracy, ethical practices, dependable service, and ongoing education.
What’s the Difference Between a Tax Preparer, CPA, and Enrolled Agent?
Not every tax professional has the same qualifications or authority to represent clients before the IRS.
| Professional | General Qualifications | IRS Representation Rights |
| PTIN-only tax preparer | Valid PTIN and applicable state requirements | Generally none |
| AFSP participant | PTIN and qualifying voluntary education | Limited rights for eligible returns |
| Enrolled Agent (EA) | IRS enrollment requirements, generally including a three-part examination | Unlimited |
| Certified Public Accountant (CPA) | State licensing, education, examination, and experience requirements | Unlimited |
| Attorney | State legal licensing requirements | Unlimited |
An Enrolled Agent is a federally authorized tax practitioner who has demonstrated tax expertise through the IRS enrollment process.
A CPA is a state-licensed accounting professional who may provide tax preparation, accounting, auditing, and other financial services within the scope of their qualifications.
You do not have to become a CPA or Enrolled Agent to begin preparing federal income tax returns for compensation, provided you meet the applicable requirements.
However, pursuing additional credentials can expand the types of professional services you are qualified and authorized to provide.
Is Tax Preparation a Good Career?
Tax preparation may be a good career choice for individuals who enjoy working with people, solving problems, organizing financial information, and learning new skills.
Some of the potential advantages include flexible career paths, opportunities for seasonal work, the ability to establish an independent business, and opportunities to develop specialized expertise.
There are also challenges to consider.
Tax professionals must keep up with changing tax laws, manage demanding filing deadlines, protect sensitive information, and maintain accuracy when working with client financial records.
The profession can involve periods of intense activity during filing season, and seasonal workers may experience uneven income throughout the year.
For individuals who value accuracy, customer service, and continuous learning, tax preparation can offer a practical path into the financial services industry.
How Long Does It Take to Become a Tax Preparer?
There is no single timeline for becoming a professional tax preparer.
A beginner may be able to complete introductory training and obtain a PTIN relatively quickly, but developing the knowledge necessary to prepare tax returns accurately and independently can take considerably longer.
The time required depends on your background, the training you select, state requirements, and the complexity of the returns you intend to prepare.
Obtaining a PTIN alone does not demonstrate tax preparation competence.
A practical approach is to begin with foundational education, practice preparing sample returns, gain supervised experience when possible, and gradually expand the types of returns you prepare as your knowledge grows.
Will AI Replace Tax Preparers?
Artificial intelligence and automation are changing how tax professionals work, but preparing a tax return involves more than entering information into software.
Tax professionals must evaluate financial information, apply tax laws to individual situations, identify missing documentation, communicate with clients, and exercise professional judgment.
Modern tax preparation technology can help reduce repetitive tasks, organize information, and support tax research.
For aspiring tax professionals, learning how to use technology effectively while developing strong tax knowledge can be an important part of building a long-term career.
Frequently Asked Questions About Becoming a Tax Preparer
Can anyone become a tax preparer?
Many individuals can pursue a career in tax preparation without an accounting degree. However, paid federal tax return preparers generally need a valid PTIN and must meet any applicable state requirements. Training and practical experience are important before preparing client returns.
Do I need a license to prepare taxes?
There is no general federal tax preparer license required for all paid preparers. However, some states impose registration, licensing, testing, or education requirements. A PTIN is generally required for compensated federal tax return preparation.
How much do tax preparers make per year?
The national median annual wage for tax preparers was $54,920 in 2025, according to U.S. Bureau of Labor Statistics wage data. Actual earnings vary by location, experience, work schedule, and employment arrangement.
Can I prepare taxes without being a CPA?
Yes. You generally do not need to be a Certified Public Accountant to prepare federal income tax returns for compensation. You must meet applicable IRS and state requirements, including obtaining a PTIN when required.
Can I become a tax preparer with no experience?
Yes. Individuals without prior tax preparation experience can begin learning through introductory tax education and practical training. However, completing training and developing the ability to prepare returns accurately are important before serving paying clients.
Do tax preparers work year-round?
Some tax preparers work primarily during filing season, while others work year-round. Year-round services may include tax planning, business tax preparation, amended returns, and other tax-related services within the professional’s qualifications.
What is the difference between a PTIN and an EFIN?
A PTIN identifies an individual paid federal tax return preparer. An EFIN identifies an IRS-authorized electronic filing provider. A preparer may need a PTIN even when working for a business that uses its own EFIN.
Is tax preparation a good side hustle?
Tax preparation can provide an opportunity for seasonal or part-time work. However, it is a regulated professional service involving tax law, client privacy, deadlines, and accuracy requirements. Earnings are not guaranteed.
Do I need professional tax software to become a tax preparer?
Professional tax preparation software is an important tool for preparing and electronically filing client returns efficiently. The software you need will depend on your work arrangement, the types of returns you prepare, and your business requirements.
Where can I learn how to prepare taxes?
Beginners can explore tax preparation courses, IRS educational resources, professional training providers, and foundational educational materials. CrossLink University offers resources to help aspiring tax professionals learn tax preparation concepts and become familiar with the industry.
Start Your Tax Preparation Career with CrossLink University
Every experienced tax professional started by learning the fundamentals.
Whether your goal is to prepare taxes part-time, join an established tax office, or eventually open your own tax preparation business, building a strong educational foundation is an important first step.
CrossLink University is here to help you explore the profession, understand the fundamentals, and take your next steps with confidence.
Discover beginner-friendly educational videos, tax preparation terminology, industry resources, and professional learning opportunities designed to help you build your knowledge.
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Educational disclaimer: This article provides general career and tax industry information and does not constitute legal, tax, or professional licensing advice. Federal and state requirements may change. Always consult the IRS and relevant state agencies for current requirements.
