Tax season is upon us, and that means it is time to look back on the past year. A lot can happen in a year—a new job, spouse, kids, house, investments, you name it. With that comes more tax responsibility. Life changes, so you will want a tax service that can keep up with you. If you are wondering whether you should hire an accountant for financial assistance this year, here are five signs that you should highly consider.
1. Turbo Tax Isn’t Cutting It
Online tax service software is perfect if your taxes are simple. It is especially handy for those that are just learning to file taxes or have a simple income. However, over time your taxes are likely to get more complicated, and that means that you can make big mistakes. The difference is that tax software cannot tell you that you entered the wrong amount, it just receives it. Software is not perfect, and while neither is an accountant, he or she will be able to scrutinize your personal finances on an individual level that TurboTax can’t. For example, if you are handling a large sum of money with multiple income streams, properties, etc., you can rely on a professional to minimize mistakes and maximize your returns.
2. Someone Can do it Better Than You
There is no shame in it: accountants will likely know more about your taxes than you do. As life gets more complex, so do the taxes. If you have to spend a couple hours going through all of your tax information, it may be time to hand it over to an accountant. Maybe you have a lot of obligations that you cannot afford to take time away from. In that case your divided attention will not only take away from your obligation but also give greater risk of error when you go to file. If you can afford it and you do not want to do it and someone else can do it better, then why not? An accountant has already spent thousands of hours studying, often spending months upon months of study with rigorous review programs like Beat the CPA, and sitting portions of the test multiple times. Save yourself the time and give yourself confidence that an accountant who is highly trained in this area will help you.
3. You Earn More than $200,000 a Year
It is a simple fact that your chances of getting audited rise significantly if you make $200,000 versus $199,000. At under $200,000 a person’s likelihood of getting audited is only .9%. However, at over $200,000, the chances jump to 3.7%. Now, that does not mean you will get audited, but the chances are much more significant. Keep in mind that being audited doesn’t mean that you are already in trouble, but having a trusted accountant to represent you will be a huge relief. That accountant will know all of your financial information and have all of your records organized to make the auditing process easier.
4. You are Self-Employed
If you are self-employed, or you own your own business, then you are the one is keeping the taxes in check. Consider that when you look at your taxes this season. Even if your business is not big enough to have an accountant on full time, it might be best to hand over your records around tax season to make sure you paid what you owed and get maximum returns. This is especially critical if your business is growing. As your business flourishes, the chances for higher taxes increases, as well as the doors that may open for tax breaks. If this is the case an accountant can also familiarize you on self-employment related retirement accounts.
5. You Have Invested in Assets
Once again, as you get older, taxes become much more complex. You may want guidance if you own multiple properties or if you sold properties. An accountant can minimize the taxes that you accrue from selling property. Check in to get advice on your investment portfolio not only for last year but for a profitable 2017 as well.
Consider hiring professional accounting help this year and make a difference in your financial future.
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