Accounting used to be a catch-all profession in which CPAs routinely handled many different types of tasks including general accounting for businesses as well as taxes. However, today’s accounting firms have specialists that handle various tasks exclusively. A tax accountant generally handles only matters related to individual and business taxation issues.
What Does A Tax Accountant Do?
A tax accountant handles taxation questions and accounting for businesses and individuals. In the course of a year, a tax accountant may compile financial records, meet with clients to set up withholding and other tax-related accounts, collect and distribute information from and to clients, and file quarterly and yearly forms for a client’s tax returns. A tax accountant answers specific client questions about taxes and may work with other professionals such as tax attorneys to give advice to clients about problematic tax issues.
How Do I Become a Tax Accountant?
According to the Bureau of Labor Statistics, most accountants have a bachelor’s degree and some possess master’s degrees in accounting or business management. While there are not many programs that specialize in tax accounting, it is important that a student who knows he or she wants to work in the tax accounting field take as many electives and classes geared toward tax accounting as possible. Students would be wise to take general business classes as well as any classes offered on economics or taxation as it relates to modern business. Economics in particular is a good course of study for tax accountants and a student may even want to consider a minor in business or economics to bolster his or her degree in accounting.
A typical undergraduate accounting program typically consists of two years of core classes followed by two years of accounting and business classes. After graduation, the student can sit for the National Certified Public Accountant exam given by each state. Students intending to become CPAs must take extra classes in some states; in fact, 33 states now require CPAs to take up to 50 hours in additional coursework before sitting for the accounting exam. An accountant must be licensed in the state in which he or she wants to practice and must take continuing education classes to keep his or her license current.
What Do Tax Accountants Earn?
Accountants of all types earned a median annual salary of $61,690 in 2010, according to the Bureau of Labor Statistics. The lowest-paid 10% percent of accountants took home below than $38,940 and the top-paid ten percent earned over $106,880.
Where Do Tax Accountants Work?
While most accountants work in offices, some travel to clients’ homes or businesses. During certain times of the year, an accountant may work very long hours as tax filing deadlines approach.
According to the Bureau of Labor Statistics, about one in four accountants work in the general bookkeeping, account, payroll, and tax preparation fields. Eight percent of all accountants work in the finance and insurance industries, while seven percent work for the government. Six percent work in manufacturing and six percent work in management enterprises.
What is the Job Outlook For Tax Accountants?
New graduates seeking a tax accountant job can look in several important fields such as auditing of large corporations. This field has grown in the past few years as more attention is paid to false accounting on the part of large companies. The Bureau of Labor Statistics says that the average growth rate for all accounting jobs between 2010 and 2020 will be sixteen percent, which is slightly better than the average job growth rate for all jobs.
Tax accounting can be an exciting career for a person who is organized, enjoys challenges, and wants to help individuals and businesses with the confusing problems related to filing and paying their taxes.