Tax Preparers: Job Description
Prepare tax returns for individuals or small businesses.
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The Daily Work of Tax Preparers Do?
The core tasks performed by tax preparers span:
- Compute taxes owed or overpaid, using adding machines or personal computers, and complete entries on forms, following tax form instructions and tax tables.
- Use all appropriate adjustments, deductions, and credits to keep clients' taxes to a minimum.
- Furnish taxpayers with sufficient information and advice to ensure correct tax form completion.
- Interview clients to obtain additional information on taxable income and deductible expenses and allowances.
- Prepare or assist in preparing simple to complex tax returns for individuals or small businesses.
- Review financial records, such as income statements and documentation of expenditures to determine forms needed to prepare tax returns.
- Check data input or verify totals on forms prepared by others to detect errors in arithmetic, data entry, or procedures.
- Explain federal and state tax laws to individuals and companies.
What Tax Preparers Need to Know
Effective tax preparers rely on a mix of skills and domain knowledge.
Key Skills
The abilities most central to this role, rated on an importance scale of 0 to 5:
Top Knowledge Areas
Related Job Titles
People in this occupation may also be known by titles such as:
- CPA (Certified Public Accountant)
- Corporate Tax Preparer
- Credentialed Tax Expert
- Credentialed Tax Professional
- Enrolled Agent
- Income Tax Advisor
- Income Tax Consultant
- Income Tax Expert
Employment and Demand
The U.S. employs around 188,739 tax preparers working in the United States today. Demand is forecast to grow by +9.5% over the projection horizon.
Salary for Tax Preparers
| Statistic | Value |
|---|---|
| Annual median | $67,542 |
| Hourly median | $32.47 |
| 10th percentile | $39,773 |
| 25th percentile | $53,657 |
| 75th percentile | $81,426 |
| 90th percentile | $95,311 |
Wages vary widely based on experience, location, and industry.
Tax Preparers Salary by State
| State | Annual median salary |
|---|---|
| Alaska | $77,010 |
| New York | $73,230 |
| California | $73,210 |
| Montana | $71,370 |
| Minnesota | $65,530 |
| Colorado | $62,860 |
| Texas | $61,510 |
| Wyoming | $60,340 |
| Virginia | $59,220 |
| North Dakota | $59,130 |
| Massachusetts | $58,720 |
| Utah | $58,660 |
| Iowa | $57,440 |
| New Jersey | $56,440 |
| Rhode Island | $56,070 |
| Idaho | $54,500 |
| Vermont | $54,240 |
| Maine | $51,240 |
| South Dakota | $51,060 |
| Ohio | $50,760 |
| Puerto Rico | $49,500 |
| Oregon | $49,220 |
| Nebraska | $49,020 |
| Connecticut | $48,950 |
| Florida | $48,790 |
| North Carolina | $47,700 |
| Pennsylvania | $47,340 |
| Michigan | $46,870 |
| New Hampshire | $46,650 |
| Indiana | $46,430 |
| Hawaii | $46,170 |
| Wisconsin | $46,010 |
| Washington | $45,120 |
| Maryland | $45,080 |
| Kansas | $44,810 |
| Arizona | $43,710 |
| Missouri | $42,280 |
| Delaware | $42,110 |
| Georgia | $41,780 |
| Nevada | $41,480 |
| Illinois | $39,220 |
| Guam | $38,460 |
| New Mexico | $38,070 |
| Oklahoma | $37,860 |
| South Carolina | $37,550 |
| Louisiana | $37,430 |
| Arkansas | $36,070 |
| Kentucky | $35,830 |
| Tennessee | $35,640 |
| Alabama | $33,490 |
| Mississippi | $33,390 |
| West Virginia | $30,470 |
Where Tax Preparers Earn the Most
Compensation for tax preparers shift depending on where you work. Top regions by median wage:
| Region | Median annual wage | Share of U.S. jobs | Location quotient |
|---|---|---|---|
| Far Western US | $65,451 | 20.2% | 1.26 |
| Middle Atlantic | $62,885 | 17.1% | 1.27 |
| Rocky Mountains | $62,036 | 5.9% | 1.72 |
| New England | $54,483 | 4.3% | 1.02 |
| Plains States | $52,820 | 6.9% | 1.03 |
| Southwest | $52,689 | 14.1% | 1.26 |
| Other U.S. Territories | $48,692 | 0.6% | 0.85 |
| Great Lakes | $46,458 | 8.3% | 0.81 |
Highest-Paying Metro Areas for Tax Preparers
| Metro area | State | Median annual wage | Employment |
|---|---|---|---|
| San Jose-Sunnyvale-Santa Clara, CA | CA | $83,600 | 770 |
| San Francisco-Oakland-Fremont, CA | CA | $83,240 | 1,590 |
| Anchorage, AK | AK | $77,010 | |
| Los Angeles-Long Beach-Anaheim, CA | CA | $74,670 | 4,240 |
| St. Cloud, MN | MN | $73,550 | 40 |
| New York-Newark-Jersey City, NY-NJ | NY | $71,990 | 6,870 |
| Great Falls, MT | MT | $71,710 | 30 |
| Billings, MT | MT | $71,370 | 90 |
Industry Breakdown
The largest employers of tax preparers are found across these industries:
| Industry | Employment | Median annual wage |
|---|---|---|
| Professional, Scientific, and Technical Services | 71,590 | $49,950 |
| Information | 800 | $61,020 |
| Finance and Insurance | 520 | $80,510 |
| Management of Companies and Enterprises | 100 | $59,840 |
| Health Care and Social Assistance | 90 | $43,680 |
| Wholesale Trade | 70 | $109,770 |
Below are examples of industries where tax preparers work:
Tools and Technology
- Accounting software: Intuit QuickBooks (hot technology)
- Data base user interface and query software: Microsoft Access (hot technology)
- Spreadsheet software: Microsoft Excel (hot technology)
- Office suite software: Microsoft Office software (hot technology)
- Electronic mail software: Microsoft Outlook (hot technology)
- Word processing software: Microsoft Word (hot technology)
- Tax preparation software: Intuit TurboTax (in demand)
- Compliance software: Tax compliance property tax management software (in demand)
- Accounting software: Tax software (in demand)
Work Environment
The work environment for tax preparers is shaped by the following characteristics:
- Importance of Being Exact or Accurate
- Spend Time Sitting
- Telephone Conversations
- Importance of Repeating Same Tasks
How to Become Tax Preparers
Entry-level tax preparers positions require a high school diploma or equivalent as the typical entry-level education. This career aligns with Medium Preparation Needed (Job Zone 3), reflecting the level of preparation typically expected.
Other Careers to Consider
Similar Occupations
- Financial Managers (Supplemental)
- Compensation, Benefits, and Job Analysis Specialists (Primary-Long)
- Accountants and Auditors (Primary-Short)
- Budget Analysts (Primary-Long)
- Credit Analysts (Primary-Long)
- Personal Financial Advisors (Primary-Short)
- Financial Examiners (Primary-Long)
- Credit Counselors (Primary-Short)
Top Programs to Study For This Career
Aspiring tax preparers often complete programs in:
Business, Management, Marketing, and Related Support Services
3 programs across 2 majors
About the Data
Statistics shown above are sourced from the following authoritative sources:
- U.S. Bureau of Labor Statistics — Occupational Employment and Wage Statistics (OEWS) for employment and wage data by state and industry.
- BLS Employment Projections for total employment and growth forecasts.
- O*NET (Occupational Information Network) for skills, knowledge, tasks, work activities, work context, technology, and education-zone data.
SOC code: 13-2082.00 (Tax Preparers).
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