Should you file your own taxes? That is a question that many people ask during tax season. Before you decide whether you should do your own taxes or hire a professional tax preparer, you need to weigh the pros and cons.
Hiring a Professional
You will be able to save a lot of time if you hire a professional. You will be able to take care of other tasks while you have local tax filing services prepare your tax returns. If you save time, then you will be able to save stress.
Fees are Tax Deductible
Hiring a professional is a lot more expensive than doing your own taxes. However, the fees that you pay may be tax deductible.
If you do your own taxes, then you are prone to making mistakes. The Internal Revenue Services reviews every tax form carefully. If you have a mistake on your form, then you may have to do your taxes again. However, a professional will ensure that there are no errors.
The cost of hiring a professional can vary greatly. Many professionals will charge you over $100 for a simple return. You may also have to pay over $300 if you have to itemize expenses.
The busiest time of the year for tax professionals is between January and April. That is why you will have to plan ahead. You may have trouble making an appointment if you wait too late.
Preparing Your Own Taxes
You can file your own taxes electronically for free if you file on the IRS website. There are also some online companies that allow you to file your taxes for a relatively low cost. Credit Karma is one of those companies.
Gain Financial Insight
If you file your own taxes, then you will have to take a close look at your finances. You will be able to see ways that you can save money. This can help you improve your financial situation.
It is time-consuming to file your own taxes. Not only will you have to spend a lot of time preparing your forms but you will also have to familiarize yourself with the tax laws.These laws can be hard to understand.
There is an online help available to make this process easier. However, the online help may not be enough.
Risk of Error
If you file your own taxes, then you will be 100 percent responsible for any errors. It can be costly to make an error on your tax return. Not only will you have to re-do your tax return but you may also be charged additional penalties and fees. It is a good idea to prepare your tax return and then set aside several days to review it. If you have done your own taxes in the past, then you should prepare this year’s tax return to last year’s tax return.
Tax season forces people to make difficult decisions. Many people struggle to decide whether it is best to do their own taxes or hire a professional. That is why you should review the advantages and disadvantages of each option.