Reasons to Hire a Tax Professional

It’s natural for people to wonder if they wouldn’t be better off doing their own tax returns rather than paying for someone else to do it for them. However, short term savings can turn into long term losses if you make a mistake or miss out on a tax reducing possibility you didn’t know about. 

Saving Time

If time is money, then preparing your own tax returns costs you more than you might realize. The average American spends approximately 23 hours preparing their tax returns if they use the 1040 form. That’s time that you could spend more productively making money instead of doing your taxes. 

Using Deductions

The U.S. tax code is notoriously complex and under constant revision, with over three thousand changes in in since the year 2000. It is very unlikely that you are aware of all the deductions and tax breaks that you are entitled to, but a trained professional knows about all the major tax breaks and how to find the more obscure ones. Just discovering a single tax break can be enough to save you more money than the cost to have your taxes done in the first place. These saving are especially important if you are self-employed, own real estate or have investments that yield capital gains or dividends.

Finding a Good Tax Professional

When a professional does your tax returns, it lowers the chances that you will make mistakes that can cost you dearly in interest and penalties. But how do you know whether a tax professional is competent to do your returns right? Look for a firm that has a wider focus than just tax preparation. For example, Michael J. Yuda, who runs a CPA firm in Hawaii, does bookkeeping, accounting and business consulting as well as tax preparation. A tax professional with a wide ranging background will be more likely to be aware of the money saving angles that others miss. 

A Wise Decision

Based upon such factors as your level of income, age and military service you may be able to get a discount on tax preparation services. However, it is well worth paying for the service if you have to, as the money you save in deductions and peace of mind will more than offset any expenses. You will also save time, maximize your deductions and employ money saving opportunities that you might have missed otherwise.