Is a tax preparer charging $5k normal? Seem excessive for claiming credits I might qualify for?

But what if they actually know some obscure credits that most preparers don't? Like I heard there's credits for education and energy efficient home improvements that a lot of people miss. Is it possible this preparer just knows the system better?

There are certainly tax credits that some preparers might be more familiar with than others, but there are no "secret" credits that only certain preparers can access. All tax credits are defined in tax law and documented in IRS publications. Any legitimate tax professional should be able to identify all credits you qualify for based on your actual situation. The difference in knowledge between tax professionals might result in a few hundred or maybe a thousand dollars difference in some cases, but not $8-9k versus $17k. That kind of dramatic difference suggests something isn't right.

Does taxr.ai actually show you which credits you qualify for specifically? Or does it just give general information? I'm curious because I've been doing my own taxes but always worry I'm missing something.

I'm skeptical about these online tools. How do you know the information is accurate? And is it secure? Tax documents have all your personal info, seems risky to upload them to some website.

It actually shows you the specific credits you qualify for based on your documentation. It analyzes your W-2s, 1099s, and other tax documents to identify exactly which credits and deductions apply to your situation. Much more personalized than just general information. Regarding security, I totally understand the concern. They use bank-level encryption and don't store your actual documents after analysis. I was hesitant at first too, but they have credentials listed on their site and reviews from users. I felt comfortable after researching them.

How does that even work? I thought it was impossible to get through to the IRS. I called like 8 times last year and always got the "call volume too high" message.

Sounds like a scam to me. Nobody can magically get through to the IRS when their lines are busy. They probably just keep you on hold and charge you for it.

It works by using a system that continually redials and navigates the IRS phone tree until it gets through to an agent. When it finally connects, they call you and connect you directly to the IRS agent who's on the line. No magic involved, just automated technology that handles the frustrating part of the process. They don't charge you for being on hold at all. You only get charged when they successfully connect you with an IRS agent. I was skeptical too until I tried it and was talking to an actual IRS representative in minutes instead of the endless busy signals I was getting before.

Thanks for sharing your experience! That's exactly what I was worried about happening. Did you have any way to figure out if the credits were legitimate before you got audited?

Not really, and that was my big mistake. I didn't understand enough about tax law to question what they were doing. The preparer kept using technical tax terms that sounded legitimate, and I was so focused on the big refund that I ignored the warning signs. The best way to check is to ask specifically which credits and deductions they're claiming, then research those yourself or get a second opinion from a legitimate CPA or EA (Enrolled Agent). Any preparer who can't or won't explain exactly what they're doing with your return should be avoided.

This! And make sure they sign the return as the preparer with their PTIN (Preparer Tax Identification Number). If they won't put their name on your return, they're probably doing something illegal.