WEDNESDAY, MARCH 16, 2016
This week we are continuing our discussion of all things taxes, and looking at scenarios where you should hire an accountant.
Listen -- we are all for DIY, and Turbo Tax is a great resource for lots of people! However, if you fall into any of the 7 scenarios we are about to outline, you may want to consider hiring a pro. Costing anywhere from $270-$400, a tax account will help you find deductions you may not be aware of, be up-to-date on the latest laws and help you avoid an unpleasant audit from the IRS.
1. You started your own business.
Congratulations! Starting your own business is a big deal -- and there are a lot of t's to cross and i's to dot when it comes to filing taxes for your new venture. Tax experts can help you find lots of deductions and save you lots of money! Definitely hire a pro to walk you through those first few filings.
2. You bought or sold real estate.
There are extra forms and sections you'll have to fill out if you bought or sold any real estate. And, if you purchased a second home or vacation property, things become even more complicated.
3. You made investments (property, stocks, etc)
As a general rule, the more complicated your financial situation, the more complicated your taxes. Do yourself a favor and let a pro take care of this!
4. You earned more than $200,000.
Your odds of being audited rise significantly once you cross the $200 threshold. According to Kiplinger's, your chance of being audited rise to 3.7% if you make more than $200k, versus less than 1% if you don't.
5. You had a change in marital status.
If you got married/divorced, had another child or lost a spouse, you might need help finding the best filing status for that year. Some of them are easy; but others, (like being a widow) have time-sensitive dates and can just be very overwhelming.
6. Your kids left home (i.e., a change in your number of dependents)
As your children get older, tax credits and deductions might expire depending on their ages. If your child goes to college full-time, you can still claim them -- and any education expenses -- until they're 24. But, if your child is on their own, your taxes will be affected -- and a pro can help you sort through your new tax situation.
7. You had a big loss -- or gain.
Whether you sold some stock for a profit, or went into the red selling a house, a tax pro can help. In the case of the former, an accountant can help you plan so that the gain is taxed at long-term rates; and with the latter, help you find other ways to minimize taxes.
So, if you answered "yes" to any of these scenarios, consider calling an expert! The additional cash they find for you could potentially offset any fees -- and help you avoid the IRS knocking at your door down the road!
Sources: 1. Irs.gov, Tips for Choosing a Tax Return Preparer | 2. Huffington Post, 7 Reasons Why You Should (And Shouldn't) File Your Own Taxes.
Posted 11:00 AM
Tags: irs, taxes, hire a professional, tax guide, tax season, tax return, audit, deductions, avoid an audit, when to hire a tax professional, capital loss, capital gain
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