Tax season is not an exciting time for most people (unless you’re expecting a large tax refund). It can be stressful trying to get all of your paperwork in order and even more stressful if you plan to self prepare. If you’re not sure whether you should tackle that tax form on your own or hire a pro, here are some signs you need to call a professional tax preparer.
Paperwork and numbers are not your strong suit
If thinking about working through instructions and calculating numbers gives you anxiety, tax preparation is definitely something you should leave to a professional. If numbers isn’t your strong suit, you could risk miscalculating something that gets you in trouble with the IRS or requires you to pay more money now or in the long run.
Your tax return is complicated
Filing your taxes may have been easy when you had no dependants, no spouse, zero assets, and one job, but add those things into the mix and it gets complicated. The 1040 and 1040EZ tax forms are pretty straight forward, but tackling other forms is a bit harder. There are a lot of rules to follow, and making sure the return is prepared in the correct order (tax pros call this the flow of the return) is important. Not following the rules or getting the flow of the return wrong could result in problems down the line.
You experienced a life change
Marriage, children, starting a new business, buying a house (and many more things), are all major life events that change your tax situation. When your tax situation changes, there are specific tax moves that need to be made to lower your tax liability. There are also different tax forms that may need to be filed. If you are uneducated in the tax law, you may not know what moves to make or how to file. This could result in IRS trouble by way of an audit or a costly penalty fee.
Your time is limited
It can take a considerable amount of time to prepare and file your tax return. If your time is valuable and limited, why not let a professional take the work off your hands? This way you’re not rushing to get it done and you don’t risk making a careless and costly mistake.
You are getting communication from the IRS
If the IRS is trying to contact you about previous returns – or if you owe them money – you definitely need to speak to a tax professional. A professional preparer can advise you on what steps to follow or actions to take. Many times, they can reduce the amount you owe, and if they are an Enrolled Agent, they have the ability to represent you before the IRS.
Learning the tax law and how to prepare taxes is something that tax professionals study and take courses on. Why not put this important task in the hands of someone who knows the law and can ensure you pay the least amount of taxes possible?