As April 18th gets closer and closer, so does the big decision: should you do your own taxes with online software, or should you grit your teeth and hire a professional accountant?
We’re not about to make that decision for you.
But we can tell you the good things and the bad things about hiring a pro. After that, it’s up to you.
The Pros of Hiring A Pro
You save time. And time is money. The average taxpayer spends 13 hours a year untangling their taxes – and for the average business owner, that number goes up to 24 hours or more. The more forms and schedules you have to fill out, the longer the process takes. (Keeping shoddy records slows you down even further.) Depending on how highly you value your time, it could be a significant loss of cash.
A professional works fast and handles all your taxes in a few hours. Sure, the fee is higher per hour, but the job gets done a lot faster.
You’re less likely to get audited if you use a pro. The tax code changes every year, and each year there’s something new for you to get wrong. Fortunately, the accountant knows the ins and outs of all these rules, and they’ll be able to set you straight.
If you’ve had any major life changes this year – like starting a business, making major investments, buying real estate, getting married or divorced, or moving – you’re far better off biting the bullet and visiting your accountant. Otherwise, you may find yourself on the receiving end of some nasty mail from the IRS.
The pro may find “Easter Egg” deductions that you’d have missed on your own. The tax pros are smart! They may find deductions or credits that leave you with a little extra money at the end of the year. Now that’s an encouraging thought.
Your “pro time” is deductible. All your tax preparation fees can be deducted as miscellaneous expenses on Form 1040, as long as the sum of all your deductions exceeds 2% of your adjusted gross income. Note: In order to get this perk, you will have to itemize your deductions – more about that here.
The Cons of Hiring A Pro
Pros cost money. About $273 for an average session – more, if you spend more hours and have more problems. But you have to weigh the initial “ouch” factor against the very real benefits of having your taxes prepared by someone who knows what they’re doing.
All pros are not equal. Sadly, some accountants are unqualified or incompetent. Do your research and make sure the one you choose is registered with the IRS and has a successful track record.
You have to plan ahead. Those slots fill up fast! If you wait until March or April to make a reservation you may be stuck doing your own taxes online. Start researching accountants in your area and book a slot now – because the good ones will go quickly.
No matter what you decide, do your research. And remember – we’ll always be here to help you if you run into trouble.
If you have any questions about preparing your taxes, give us a call at 844-841-9857, or schedule a free consultation here.
A recent article from the Washington Post cites data from 2019, where 1.3% of taxpayers earning one million to five million dollars were audited. Further, only 0.2% of those earning $25,000 to $50,000 were audited. You must understand this is not a personal attack when you receive an audit letter. The IRS has a computer...
In June 2023, the IRS began sending millions of CP14 notices to taxpayers countrywide. Those who receive these statements typically have many questions about what they mean and how to handle them. The Polston Tax Resolution & Accounting professionals are here with the answers you need. What Is an IRS CP14 Notice? An IRS CP14...
In 2022, Americans owe a whopping $120 billion in back taxes, according to the IRS. Now some people owe a year’s worth of taxes and can quickly get back on track. At the same time, others owe years and years’ worth of taxes and face severe consequences for their unpaid taxes. Have you been worried...
Receiving a letter from the IRS or the state can be intimidating, especially if you’re unsure what the notice is for or what to do next. Fortunately, many notices are nothing to worry about and are purely informative. Below, we take a look at everything you need to do — and what not to do...
The Employee Retention Tax Credit (ERC or ERTC) is a tax credit that the United States government introduced as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act. The ERC was meant to help businesses across the country that were feeling the negative impacts of the COVID-19 pandemic. Eligible companies are still able...