Why Should You Work With a CPA For Tax Prep?
The holidays are almost upon us, and for those of us in the accounting world, that can only mean one thing: Tax season will be here before we know it.
When you start thinking about getting your taxes in order, you may feel overwhelmed at the number of options out there. You can sift through software platforms and attempt to do it yourself, visit a tax preparer with limited experience, or you can work with a tax professional.
While everyone's situation is different, there's a reason the majority of returns are filed by a professional. Here's why we recommend you work with a Certified Public Accountant (CPA) when it comes time to take care of your taxes.
CPAs Can Spot Tax Savings You Might Miss
Professional accountants do this for a living, which means they're well versed in what to look out for as they comb through your information. Tax professionals are trained to look for deductions, credits, and other strategies that can significantly lower your tax bill. They will also understand how major life events, like getting married or buying a home, impact your taxes that year.
You Will Save Time and Energy
You're busy running a business (or two, or three). When you hand over your taxes to a trusted professional, you relieve stress and anxiety. While you still have to gather your documents and provide them to your CPA, you don't have to worry about inputting everything correctly, double-checking to make sure you didn't miss anything, or worrying about when to file.
The bottom line? It makes sense to outsource tasks that aren't part of your regular activities to someone who is an expert.
A Tax Professional Is Up to Date on the Tax Code
Got a freelance job or a side hustle? Do you sell products or goods in different states? Does your business operate in multiple geographical areas?
The type of work you do—and where—impacts your tax return. CPAs are experts in the tax code and how it applies to your business, which most laypeople don't have time to keep up with. They can help your business with proper tax planning and ensure your business is in compliance.
CPAs Can Help in the Event of an Audit
While your chance of being audited is typically very low, CPAs can communicate with the IRS on your behalf if you're being audited or if the agency needs more information from you. Having someone who understands exactly what is being asked of you and can respond appropriately can be invaluable.
CPAs Can Help Beyond Taxes
Tax professionals do much more than prepare tax returns. They can help you with financial business planning, plan out your retirement, map out how you can grow your business, and more.
If you're self-employed, your CPA can help you figure out next year's estimated taxes so you don't over- or under-pay each quarter. If you're a business owner looking for help running your business day-to-day, some CPAs can also take on tasks like payroll and help your business stay organized.
Hiring a CPA Can Save You Big Come Tax Season
You may have heard the rule of thumb, "The more complicated your taxes, the more you should hand it to a professional," and there's truth to this. However, even if you've only got a single W2 and some other information, there may be value in having a professional look over your taxes.
CPAs can help you uncover tax savings, save you time and effort, and assist you in planning for your business and life beyond tax season.
Modis offers tax return services for individuals and businesses; to learn more, contact us.