Which of the following is a red flag when hiring a tax preparer?

The identification of a red flag when hiring a tax preparer relates closely to the ethical standards and practices expected in tax preparation. Encouragement of tax fraud and guarantees of no audits signal serious concerns about the integrity and legality of the services being offered. A tax preparer promoting fraudulent practices undermines the law and poses significant risks for clients, including the possibility of legal actions, penalties, and financial loss.

Tax preparers should adhere to ethical standards, which encompass honesty and transparency. Guaranteeing no audits is a false promise, as audits are at the discretion of the IRS and cannot be predicted or guaranteed by a preparer. Therefore, any indication that a preparer is willing to bend or break rules to achieve a favorable outcome should be viewed with great suspicion, making it a notable red flag during the hiring process.

The other options, while they may raise questions, typically do not indicate unethical behavior. For instance, asking for tax returns early can be a common practice to get all necessary information for filing. Offering discounts for early payments may simply reflect a business strategy to encourage prompt payment, and providing a detailed breakdown of fees demonstrates transparency and allows clients to understand what they are paying for. Thus, option B stands out for pointing towards a fundamental breach of