Should I Hire A Professional To Do My Taxes
When it comes to filing taxes, Americans have only two options. First is do their own taxes with a tax software or through the IRS website. The second is to hire a professional to do it for them.
Should I Hire a Professional or Do My Own Taxes
Filing taxes requires time, patience and your undivided attention. Trusting it to a professional means ensuring all your bases are covered.
If you feel your time could be better spent elsewhere
Rushing through your filing is not an option as mistakes are too costly to make. If you are tight on time, it’s probably more prudent to outsource.
If you have a complicated tax situation
Pretty much every financial transaction comes with some kind of tax consequence. The more transactions you have, the more complex the process becomes. People who have dependents, investments, significant assets or charitable contributions, are freelance, self-employed or own a business can significantly benefit from a professional to deal with their atypical tax situations that involve a ton of audit red flags such as home offices, business meals and travel, and vehicles.
If you’re planning to itemize your deductions
If you have major medical costs, a mortgage, or make large charitable donations, you might save more money itemizing your deductions than taking the standard deduction. But, itemizing can be a tricky process, especially if it’s your first time.
You’ve experienced a major change in your life during the year
Things such as getting married, getting a baby and buying a house impact your tax filing. You can either find out in which way or let a professional do what he or she does best.
Benefits of Hiring a Professional To Do Your Taxes
Tax professionals know their stuff and your finances can greatly benefit from their knowledge. For example, do you know a difference between a tax deduction and a tax credit? A deduction reduces your taxable income, which can result in a lower bill. A credit will directly trim your tax bill. Both can be huge money savers, as long as you know what they are, how they work and how to qualify for them. But, there are many more benefits to hiring a professional to help you with your tax filing.
It can save you time
Most people can save money filing their own taxes with online software, but you need to have a basic understanding of taxes and trust that a virtual preparer has you covered. Learning all these rules as well as keeping up with updates both take valuable time from your schedule that you could otherwise put to better use.
It can save you money
First, if your tax preparer finds even one deduction or tax credit you may have missed, the savings can easily exceed the fee you paid to have your taxes filed. Second, professional tax preparers are paid to keep up with the tax code and their expertise can help ensure that you get all the deductions and credits you are eligible for. For instance, if you are self-employed and working from home, you can deduct a portion of your rent and Columbia Gas utilities. Third, tax professionals can advise you on the best strategies to make smart tax-saving decisions that will save you even more money over the long-haul.
Simplify the process
The tax code is very complicated. It’s very likely you will have questions throughout the filing process. Tax professionals keep up with the changes so you don’t have to, just like you don’t have to wait hours for the IRS to reply.
Making mistakes can be very costly and a tax professional will ensure they don’t happen. Moreover, a tax professional can review your previous returns to see if any deductions were missed and, if so, amend them.
Hiring a professional to do your taxes means gaining peace of mind. It takes the hassle out of doing it yourself and reduces the risk of an audit. Even in the case you are audited, a professional tax preparer knows how to deal with the IRS.