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Home › Accounting Careers › Tax Accountant

Learn how to become a tax accountant

Do you like working with numbers? How about enjoying working with people to solve problems? If so, a career as a tax accountant might be for you. Tax accountants play a crucial role in unlocking tax compliance, making them valuable to both businesses and individual taxpayers.

Tax accountants play a crucial role in unlocking tax compliance, making them valuable to both businesses and individual taxpayers.

Tax accountants work with clients to prepare and file income tax returns, plan and project upcoming tax liabilities, and correspond with the Internal Revenue Service and state agencies.

Should I become a tax accountant?

Accounting and tax professionals are some of the happiest workers in the United States. In fact, a recent study ranked the industry second with 72.2 out of 100 points, just behind the construction sector with 72.2. The satisfaction of a career in accounting isn’t the only positive factor. The U.S. Bureau of Labor Statistics also found that the industry is expected to grow 4.6% through 2034.

If you like working with numbers, have a background in accounting or finance, and are looking for a career with growing demand, becoming a tax accountant might be beneficial. However, before you can become a tax accountant, you need to complete the necessary education and credential requirements, which can take anywhere from a few months to a few years.

How do I become a tax accountant?

Becoming a tax accountant requires a mix of education and licensure. Here are four steps to starting your career as a tax accountant:

How much does a tax accountant earn?

A career as a tax accountant is fulfilling and may pay well. The U.S. Bureau of Labor Statistics estimates that the median pay for accountants is $81,680 per year or $39 per hour. Take a look at median annual salaries by state as reported by the BLS:

How do tax accountants compare to other finance careers?

Tax accountants offer specialized services compared to general accountants and bookkeepers. As a result, the median annual salary is often higher. Here’s how accountant careers compare to other finance-related career fields:

Factors that impact salary

The pay you can expect to receive depends on your experience level and where you work. For example, entry-level tax accountants will make less compared to a senior or partner-level tax accountant. As you build your experience, your salary will likely increase.

Additionally, where you work may impact your salary. If you are a self-proprietor, your salary can vary based on your client levels and pricing. Similarly, working in the private sector can create salary differences compared to working for a public accounting firm.

The highest paying cities for tax accountants are often the ones with a high cost of living. Here’s a short list of top paying metro areas, as reported by the BLS, along with their median pay:

What being a tax accountant is all about

Tax accountants take on a variety of roles and responsibilities within an organization. Here are some of the main job duties:

• Tax return preparation
• Tax planning
• Responding to letters and inquiries
• Answering client questions
• Interpreting the tax code
• Financial analysis
• Understanding changing tax laws

Each tax accountant will have a different work schedule. Here’s what a typical day might look like:

• Respond to emails
• Prepare a tax return
• Have a tax planning meeting with a client
• Respond to more emails
• Network

Accountants generally work the traditional 9-5 hours. In recent years, many accounting firms have switched to a hybrid work schedule, adding more flexibility to the profession.

What does this job look like from a client’s perspective?

From a client perspective, tax accountants are trusted experts throughout the year. After all, most people won’t have the background and experience interpreting tax law, which makes tax accountants indispensable.

Clients will usually send a tax accountant all of their tax documents. After you review the documents, you will follow up with the client on any questions or outstanding items. This process can go back and forth a few times until the return is finalized. Then, the tax accountant and client will usually meet to discuss results and any changes needed going forward.

Needed skills and competencies

Effectively completing the tasks of a tax accountant requires a few different skills. For one, you should have a strong attention to detail. Transposing just one number could land your client in a tough situation with the IRS. You also need great communication skills to uncover tax planning opportunities and prepare accurate returns. Additionally, critical thinking skills, time management, analytic reasoning and adaptability are all necessary skills for a tax accountant.

The good news is that the days of mental math and manually filing tax forms are long gone. Tax accountants use technology and resources to prepare and file tax returns. These programs streamline workflow and complete a majority of the calculations on your behalf. Accountants will spend most of their day using different software programs on their computers.

Where you’ll work

Tax accountants have flexibility in their positions and roles.

Job titles

• Staff Accountant: This is an intro-level accounting position.
• Senior Accountant: After one or two years, you move up to senior accountant.
• Tax Manager: Once another few years have passed, you move up to a manager position.
• Senior Manager: After you’ve held a manager position for a few years, senior manager is the next stop.
• Partner: Partner is generally the highest job title for a tax accountant.

Environments

There are two main environments for tax accountants: public and private.

• Private: Working for a private company as an internal staff member.
• Public: Working for a variety of clients through an accounting firm.

How to make yourself stand out as a candidate for a tax accountant job

Standing out among other applicants is important to land your dream job and achieve the best employment terms. Here are some top tips to stand out:

• Develop a professional network
• Be honest and upfront about your goals and expectations
• Use logic instead of emotion when making decisions
• Highlight traits that contribute to your role, like organization and time management
• Stay informed and up to date on changes impacting your industry
• Demonstrate your work ethic
• Make a commitment to lifelong learning

Professional organizations to join along the way, aka helpful resources

Professional organizations are a great way to network and ensure you are staying up to date on the latest regulations. Here are some common organizations:

• American Institute of Certified Public Accountants
• National Society of Accountants
• National Association of Tax Professionals

Most states also have a private organization for professionals licensed in the state.

Frequently asked questions

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