Do You Need an Accountant to Do Your Taxes? How to Find One
You might have more options than you think
Finding an accountant to prepare your taxes is a relatively straightforward process. However, first, you'll need to ask yourself why you think you need a professional to prepare your return. There are three basic reasons you might choose to do so.
An accountant can prepare your taxes quickly and professionally, ensuring that you take all the tax credits and deductions that you're entitled. And, perhaps most importantly, he or she can tackle any complex tax situations you might face given your personal financial situation.
If Saving Time Is Your Goal
Consider going to H&R Block, Jackson Hewitt, Liberty Tax, or any another retail tax company if having your taxes done quickly and effortlessly is your primary concern. These companies employ specially-trained tax preparation experts who will get your return completed as fast and seamlessly as possible, and they have locations all over the country.
Of course, this means they're not going to spend an inordinate amount of time meeting with you to determine what tax credits and deduction you might qualify for.
Some independent accountants will prepare your taxes for you while you wait, but most will want to have at least a brief interview with you first. Then they'll typically finish your tax return within a few days. If time is of the essence and you choose not to use a retail tax company, be sure to ask how long it will take the accountant to complete your return.
Many retail tax companies also sell software at half the cost if you don't mind spending a little time at your computer keyboard.
Lowering Your Tax Bill
You might want to seek the advice of a licensed tax professional, such as a certified public accountant if figuring out how to lower your tax bill is most important to you. But keep in mind that this will probably cost you more than a retail tax company would charge. Unless you expect to save big through professional advice, it might end up being a wash financially.
On average, a professionally prepared tax return by a CPA cost about $225 in 2018. This ranged from $55 for very simple returns to as much as $450 for a more complicated one. Plan on spending at least $273 if you itemize your deductions, because this involves a good bit more work, and in the $450 range if you're self-employed and must file a Schedule C.
Dealing With a Complex Tax Situation
Call around to various tax offices to find an accountant who specializes in your problem if you have a complex tax situation. Ask about their prices and how quickly you can schedule an appointment.
Accountants often specialize in certain kinds of tax issues. If you have a special circumstance, seek an accountant who has expertise in that area. Special circumstances might include living outside the United States, day trading in the stock market, or owning a small business.
Some accountants have earned licenses or certifications in their trade. The most well-known of these is the certified public accountant (CPA). This license is granted after the accountant meets certain educational requirements and passes comprehensive testing of her tax and accounting knowledge.
Another license is that of an enrolled agent (EA). An EA is an accountant who has passed a comprehensive two-day test covering tax law given by the Internal Revenue Service. Along with CPAs and tax attorneys, these individuals are authorized to practice before the IRS. This means they can go to an audit or talk to the tax collector on your behalf without you being present.
Not everyone needs the specialized knowledge and skills these professionals have, but it’s good to know that there in case you need them.
For basic tax preparation, accountants at local tax firms are usually more than helpful and knowledgeable when it comes to basic tax preparation.
Do Some Price Shopping
Don't neglect to ask potential accountants what their price ranges are, but keep in mind that it's difficult to give an exact price estimate just by talking on the phone.
Most accountants charge for each form they have to fill out, so more complex tax returns naturally cost more than simpler ones. Some accountants are moving to a flat rate or per hour pricing, however, so it pays to ask.
Also, inquire about any guarantees an accountant might offer. Many will personally guarantee that your tax return is free of math errors and data-entry errors. The accountant should offer to redo the tax return free of charge to correct any mistakes.
But remember that you have to sign the tax return yourself. This means that it's ultimately up to you to make sure your tax return is accurate.
Don't Overlook the Software Option
This goes back to the original question: Do you really need someone to prepare your return?
The days of sharpening several pencils and dragging out a calculator are long behind us. You might want to consider just purchasing tax preparation software if you don't mind investing a little time, if your tax situation isn't extremely complicated, and if you can navigate a website or program fairly well.
Most of these programs, including H&R Block and TurboTax, will walk you through a series of questions. You answer, and the program will complete your return based on your responses. Do you have a W-2 form? Fine. Just enter the information from the form when prompted. The same goes for any Forms 1099 you've received.
Do you have any qualifying dependents for certain tax credits? Not sure? Just answer a few questions. The program will tell you the answer.
These programs usually cost about half of what an accountant will charge. State returns are typically extra, but then an accountant will usually charge extra for state returns, too.