Many of us take pride in being able to prepare our own taxes. After all, there is a measure of satisfaction to be gained when you can say that you filled out all of the forms and took care of all of your own deductions and credits. Besides, if you get stuck, there are plenty of software programs that can guide you in your efforts to prepare your own taxes.
As fulfilling as it can be to do your own taxes, however, it’s important to realize that sometimes it is not in your best interest to take the time to do your own paperwork. In some cases, it’s worth spending the money to hire an accountant to prepare your taxes for you.
I, unfortunately, only discovered the true benefits of this after years of doing taxes on my own. Here are some suggestions to help you avoid making the same mistakes that I did:
How Complex is Your Tax Return?
The first question you have to ask yourself is this: How complex is my tax return? If you have a complex tax return, having a professional complete the paperwork can be a good idea. Someone with a basic 1040, and two or three schedules, might be able to effectively fill out his or her own tax return. However, if you have several schedules, and if you have a complex situation, or a special case, the knowledge of a professional can be invaluable.
Another consideration is whether or not you have other complexities, such as a business. If you have a business, you might need to fill out a separate tax form. In some cases, though, your forms will need to coordinate. As a result, it’s usually a good idea to have an accountant fill out both forms. Other complexities might include investments, retirement account withdrawals, special tax credits, and an other item that adds the number of schedules that your return requires.
Advantages to Having an Accountant Prepare Your Taxes
Paying an accountant to take care of your tax forms can provide peace of mind, as well as save you time. Here are some of the advantages of hiring an accountant to prepare your taxes:
- Professional who knows the law: Tax law is always changing, and an accountant can help you keep track of the latest developments.
- Representation for an audit: Most accountants guarantee that they will represent you to the IRS in case of an audit. Having a professional who knows your taxes can be a great help in this sticky situation.
- Saves you time: Preparing your own tax return can be time-consuming, since you will need to look everything up. Your accountant can save you time, leaving you free to enjoy time with your family, or time to work and earn more money.
You do need to be careful when choosing an accountant, though, since some accountants are better than others. An accountant can’t guarantee that your tax return will be perfect, or that you will get all of the credits and deductions you are entitled to. But you have a better chance of having everything done properly, while avoid hours of frustration, if you hire an accountant.