It’s easy to forego a tax professional in favor of saving money, but is it worth it? As your life changes, so do your taxes. If you fail to file or make a mistake on your return, the costs can be huge. A tax expert can help you overcome obstacles, get out of debt, and take advantage of deductions on your tax return. Below are eight reasons you should consider hiring a professional.
- You Made Mistakes on a Previous Return
When life gets busy, it’s easy to rush through tax returns and make mistakes. If you find errors on a previous return or the IRS has notified you of a discrepancy, it’s in your best interest to hire a tax preparer. If you catch a mistake within three years, you have the opportunity to amend the return and prevent damage. A tax preparer can review your returns and find errors you may not have caught to minimize the risk of interest and penalties.
- You Don’t Have the Patience
Let’s face it—preparing taxes isn’t fun. Filing taxes takes time out of your already busy schedule, and as the years go by, it only gets more complicated. People who work long hours and have families may hire tax professionals to take the burden off their shoulders. When you hire a tax preparer, you can spend more time with your family and friends, and less time worrying about your finances.
- Your Number of Dependents has Changed
Dependents include children, parents, and close adult relatives. Your dependents change the amount you owe in taxes and any refunds you may receive. All dependents must:
- Be a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico
- Possess a Social Security Number (SSN), Individual Taxpayer Identification Number (ITIN), or Adoption Taxpayer Identification Number (ATIN)
- Not be filing jointly with a spouse unless it’s to claim a tax refund.
- You got Married
Your marital status as of December 31 determines how you file your taxes. A tax preparer may advise you to file jointly or separately based on your financial situation. They can also adjust your withholding amount to minimize the amount of taxes you owe.
- Marriage Penalties
Some married couples experience higher taxes when they file jointly. Spouses who earn roughly the same amount of income are most likely to experience a hike in taxes. This can also occur to those filing under head of household status.
- Marriage Bonuses
If one spouse earns all or most of the couple’s income, the couple won’t be hit with a marriage penalty. In this case, filing jointly is preferred.
- You got Divorced
Factors like alimony, child support, exemptions, medical bills, retirement assets, and tax credits can alter your taxes dramatically. If you’re facing a divorce, contact a tax preparer and talk about your options. A tax preparer can help you avoid an ex-spouse’s unpaid tax liability and detail any alimony and child support paid.
- Your Spouse has Passed
Even when a spouse dies, the IRS demands its dues. You may have to take on the task of federal estate taxes, state inheritance taxes, and more. A tax professional can help file the final tax return of the deceased partner and reduce the amount of taxes paid on the estate.
- You’ve Moved
Whether you’ve moved to a new city or a new state, it’s critical that you hire an expert to help you make the transition. State and local taxes vary from region to region, and a tax preparer can help you navigate the change.
- You Own a Small Business
Whether you just opened a small business or you’ve owned one for years, you should hire tax relief help to avoid potential pitfalls. Without the help of a qualified professional, it’s easy to make mistakes that come at a huge cost to your business. Outsourcing your accounting services can take away this burden so you can focus on the growth of your business.
If you’re filing your taxes, don’t go it alone. Hire a tax preparer to manage your taxes so you don’t have to.