Why you should or shouldn’t do your own taxes
Friday, April 21, 2017

Why you should or shouldn’t do your own taxes

Although many Americans are preparing their taxes at home there is still around 56% that seek professional help. Some people may feel uncomfortable with handling their own taxes due to perhaps lack of time or simply because the tax system is very complicated. Whether you do it on your own or hire some help, it must be done right. When filing your taxes improperly, a Fort Lauderdale tax attorney can represent your interests and alleviate your tax burden. Attorneys know how tax deductions, exemptions, and credits can work in your favor.

Do it yourself

Sometimes using an accountant or any other financial professional is not necessary. If you don’t have rental properties, own a business, or another more complex tax situation chances are you are better off on your own. Some reasons why you should do your own taxes include:

  • You will understand how the system works – The US government tax system can be complex.This is something you will learn on your own when doing your taxes. Many of the credits the government talks about may not even apply to you. With time your will get more familiar with the different forms such as the W2, 1099-MISC, 1040, and get more insightful knowledge about how to optimize your taxes.
  • Work on your finances closely – It’s amazing how preparing your own taxes can help you look at your finances from a different perspective. Doing your own taxes will help you look at various scenarios and see the outcomes. It’s not necessary to buy a home or start a business but you can definitely do more things with your money and understand where it all goes.
  • The IRS aren’t the bad guys – Sometimes the IRS can be helpful. They are not seeking to punish people. Their bad reputation is the main reason why people often prefer not doing taxes on their own. Remember the IRS knows taxes can be complicated and the system is prone to errors.
  • You make your own schedule –  It’s good to think things through when preparing your taxes. You can do your online taxes and then revisit your returns later on.

Let them handle it

With so many do it yourself sites out there you may think that you can do it all! This is a false reality. Things are not as simple as they may seem. Preparing your taxes is not another DIY home improvement project. A few youtube tutorials may not be sufficient to prepare your taxes. Some of the common reasons why you shouldn’t prepare your own taxes include:

  • You hate numbers – Let’s face it. Some people are either bad with numbers or they simply dislike them. It’s not for everyone. If you are not careful with what you are doing you will mess up your taxes. These errors will cost you in the long run.
  • You don’t care much about money or you have a good accountant – These are good reasons to handle this huge responsibility to a professional. If you have plenty of money to pay a CPA, go for it.
  • Your investments and income streams are many – If you are very wealthy and own a bunch of homes, have private investments, businesses, etc. hiring a professional to prepare your taxes is more advisable.   A person with a home mortgage and a W2 can prepare taxes on his or her own.
  • You don’t like looking at your work – If you are not the type of person who likes to review things, you may want to hire an accountant. Your answers must be reviewed thoroughly and a  professional tax preparer is generally good at that.

Hire a tax attorney

Receiving a notice from the IRS can be overwhelming. If the IRS ignores your questions, claims, or attempts to correct any mistakes, then it’s time you seek legal counsel. Remember a  Fort Lauderdale tax attorney can help you achieve IRS tax resolution especially in complex tax preparation matters.

 

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