Should I Use an Accountant to File my Taxes?

by M.E. Hansen, All rights reserved. Do not duplicate without permission

You need tax advice throughout the year.

Is a Roth IRA a better choice for you than a deductible IRA? Should you rent out your home while searching for another, or sell it first? Are your investments wisely positioned for maximum gain with minimum tax impact? Does paying off your mortgage early make sense? Is your state and federal income tax withholding right, or should you adjust it?

Tax guides, personal finance books, Internet Web sites and interactive calculators can give you answers to these questions; unfortunately, the answers are often contradictory and may not fit your particular situation. There's nothing like a professional who knows you and who can give you personalized advice.

Those who need heavy-duty investment and financial planning advice in addition to tax help should consider looking for a professional who is a personal finance specialist.

You don't want to face the IRS alone.

This can be a perfectly rational reason for paying someone to prepare your return, even if your situation meets none of the criteria above. You can always hire tax help after you receive an audit notice, of course, but having a conscientious professional prepare your return in the first place reduces the chances that you'll be facing an expensive adjustment later on. Once again, an audit-savvy preparer who knows you will be better able to answer sticky audit questions, provided you don't blow the whole thing by insisting on going along. Audits are the one time when everyone should leave it to the professionals.

I have a lady in Mich. that prepares her tax returns each year, then sends the completed returns and all of her information to me, to re-do it. When I asked her a few years back, why she doesn't just file them herself, she replyed: "I had to deal with them once, never again"

Get to know your Tax Preparer

If your still with me, then maybe your considering useing a professional tax preparer. Your choices are a Preparer Mill or a Personal Preparer. All of the online tax preparation sites, that I have checked, and most of the National or frachise offices are Preparer Mills. That means that the preparer you had last year may have moved on, H&R Block gives "long term" awards to any preparer that has stayed with them for three years or more. Getting to know your preparer and developing a long term relationship has its advantages. Every year I need to contact a few people about an item or two of income or a deduction that they forgot to include in their present years tax information. Items that I would only know about because I have been doing their returns for the last few years and have gotten to know their tax situation.

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