WHY SHOULD I PAY SOMEONE TO DO MY TAXES?

One of the questions I am asked most frequently regarding taxes is “why should I pay someone to do my taxes when I can just do them myself?” My go-to response is usually “would you try to repair your car or fix your plumbing yourself?” Now I know that DIY is a big trend right now, and there is plenty of DIY tax software on the market. I also know there are plenty of books and videos showing you how to repair your own car and fix your own plumbing. However, just because these things are available doesn’t necessarily make it a good idea to DIY. Let’s take a look at just a few reasons why you should pay someone to prepare your taxes. 

Tax professionals stay updated on changing tax law. This is not just because we find tax law riveting reading; it’s also because we are required to do so in order to keep our professional licenses. This is especially important this year as we have had some of the most significant tax reform since 1986. Keeping updated requires much more than just keeping up with news stories and articles that give a quick synopsis of tax law breakdown. In the event of an audit, the IRS truly does not care if you didn’t understand the tax laws and filed your own taxes; you will still owe them penalties, interest, and whatever money/credits you miscalculated in your return. 

When you pay someone to do your taxes, you get someone with experience and expertise in their field. Even the lowest-level tax professional is required to do a minimum of 18 credit hours of continuing education per year. The majority of us get more than that, especially if we are trying to gain new skills in the industry to offer more services to our clients. You are also getting an extra set of eyes to catch mistakes, which can be as simple as a misspelling or a wrong Federal ID number or as complex as clients claiming credits that they are not aware they are not entitled to claim. In either instance, the mistake can cost time and money. 

One of my favorite reasons for paying a professional to do taxes is that we can find little-known deductions that can add up to big savings. Every day during tax season I hear, “I didn’t know I could deduct that” or “I had no idea about that tax credit.” Having a tax professional also gives you year-round tax guidance that is just a phone call away. I have clients calling all year round with tax questions and wanting advice, especially with the new tax law changes. 

Another big reason to have a professional do your taxes is business strategy. We can help you with things like payroll, bookkeeping and budgets. Without these extra tools, you may have no idea of what the actual picture is until it is too late to do anything about it. Growing companies should be doing quarterly checkups on their business to see where they stand. Wouldn’t you rather adjust your spending throughout the year than send Uncle Sam extra money? You can do things like prepay expenses for the next year or buy that big-ticket item you’ve been putting off. 

Taxes and money are very personal, just like someone’s health. However, unlike your health, for most people taxes are a once-a-year issue that has to be dealt with; so spend the money and have a professional prepare them. My final thought is this: the IRS is probably the most feared agency in America; they have the ability to bring anyone to their knees (just ask Al Capone). Why would you trust free software, operated by a layman, to prepare your legally binding financial statement to the most feared agency in America?