Content of the material
- When to hire someone to do your taxes
- Gives a chance for the poor
- When You Should Pay Someone To Do Your Taxes
- When to file on your own
- If You Hire a Professional
- You Got Divorced
- You’re Going To Have a Major Life Event
- You’ve been in trouble before
- 🎉 You’re all set!
- Other ways paying taxes can get you a property
- The Cost For Someone To Do Your Taxes In Canada
- they already pay enough
- Benefit from HR Block’s tax expertise
- You have a complicated or changing business
- Motley Fool Returns
- Tax Preparation Software
- Wealthsimple Tax
- The Final Decision
- The Main Reasons To Do Your Own Taxes
- 1) Flexibility.
- 2) Optimization.
- 3) Easier To Cheat / Fudge Some Numbers.
- Fock Or Be Focked
When to hire someone to do your taxes
Taxes aren’t the same year to year. As your life changes, so can your tax situation. What are some examples? Let’s say you had a change in your work, bought a home, got married or had a baby.
Each of those life changes can mean new forms to complete, new credits and deductions to consider. With so much change, you might have a lot of tax questions. That might be when you decide you should pay someone to do your taxes.
The good news is by having a tax professional prepare your return, you can leave those questions to someone who knows the ins-and-outs of taxes. The even better news is that you don’t have to go into an office to get this expertise.
Gives a chance for the poor
How would you feel about becoming poor and not being able to get a job? I’m sure I would hate that. The poor come from low income families most of the time or else the families would help them. I think people with the income of $80,000 a year, that’s what I think
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When You Should Pay Someone To Do Your Taxes
If you’re going to pay someone to do your taxes, you should be looking for help that is MORE than just data entry. Yes, while a tax preparer is there to actually file your taxes – the process of getting ready to do so can involve a lot of moving parts. And this expert you’re going to hire should be able to help navigate you through it.
Some common examples of when it makes sense to pay someone to do your taxes:
- You make over $200,000 per year
- You had a life event, such as marriage, divorce, or children
- You started a business
- You own complicated investments like partnerships or trusts
- You have questions that you can’t answer
The goal of paying someone to do your taxes should be two-fold. Of course, getting your actual taxes done. And getting help and advice. Some common areas where a paid professional can help include:
- Optimizing your accounts to lower your tax burden
- Ensuring that you qualify for credits and deductions or that you take all credits and deductions you’re qualified for
- Keep accurate records of complicated investments, such as partnerships
- Help you optimize your business structure to lower your taxes
So, when deciding if you should pay someone, keep those ideas in mind when discussing your situation.
When to file on your own
As a general rule, if you’re planning to claim the standard deduction, there’s really no reason to hire someone to prepare your tax return. All you need to do in that case is list your income from your W-2 and 1099 forms and see where that takes you. In other words, if you can read and copy over numbers, you’re all set. You can either pay a modest fee for software (like TurboTax) and submit your own electronic return, or print out a paper return and send it in by mail. You’re generally better off going the electronic route, though, as it will help you avoid errors, capitalize on the deductions and credits you’re entitled to, and get you your refund faster, assuming you’re entitled to one.
Furthermore, if you earn less than $69,000, you’re entitled to file your taxes for free. You can do so through the IRS’s website.
Now if you’re planning to itemize your deductions but they’re all pretty straightforward, then you can still get away with filing taxes yourself. For example, if you’re simply copying your mortgage interest total, deducting property taxes, and listing your charitable donations from the past year, that’s not incredibly complicated work. In fact, the bulk of the hassle involved is gathering that information in the first place, so unless you’re truly intimidated by the notion of messing up your taxes, you can probably spare yourself the fees associated with hiring a professional.
If You Hire a Professional
Be sure to find a tax professional with a level of experience and specialization that's suitable for your needs if you choose this option. Some accountants are general practitioners. Others specialize in things such as helping Americans who live overseas or self-employed individuals in a variety of businesses.
The two most common professional credentials for tax preparers are certified public accountant (CPA) and enrolled agent (EA). CPAs are trained in a wide range of accounting procedures, and some of them specialize in tax preparation. EAs are trained specifically in tax procedures.
You Got Divorced
Getting divorced is one of those life events that could signal it’s time to get professional help with your tax return, especially if you have children. It can be confusing figuring out who gets to claim the kids as dependents when you’re divorced, Du Val said. “That is always a problem.” In fact, the tax audit defense firm where he works — TaxAudit — sees a lot of audits of divorced taxpayers improperly claiming dependents. It can get confusing establishing which parent has primary custody for tax purposes when parents have joint custody. “You may want to get a tax pro to help you get started,” Du Val said.
You’re Going To Have a Major Life Event
One of the key times in your life when you should get professional tax help is when you have a life-changing event such as a marriage, birth of a child or even a new job. But don’t wait until after the fact. “Speak to a professional before a major life event so you know the possibilities going forward,” said Eric Nisall, an accountant and creator of Bookkeeping for Bloggers. For example, if you get married, an accountant might advise you to fill out a new W-4 Form with your employer to adjust your tax withholding for your new tax filing status. If you’re expecting any life changes during the year, schedule a consultation with a tax pro in advance to make a plan, Nisall said. Then you won’t make any tax mistakes that can’t be undone when you file your return.
You’ve been in trouble before
We all make mistakes, and it’s usually no big deal to have to file an amended return (assuming you paid what you owed on time). If you’ve been the subject of a personal audit or owe back taxes, however, you likely can’t afford another major snafu on your tax record.
While we usually don’t know what compels the taxman to pursue some audit cases over others, it’s best to keep your nose clean with a professional who understands how to follow all the rules.
🎉 You’re all set!
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Other ways paying taxes can get you a property
There is another obscure way to potentially gain title to a property by paying its taxes called "adverse possession." With adverse possession, a third party must publicly occupy and maintain a property for a significant period of time (usually two to five years or more) including paying property taxes. After the minimum adverse possession period has passed, the third party can apply for a possession claim.
Adverse possession laws, like tax sale laws, vary from state to state, meaning how long the party must remain in the property without dispute from the homeowner will differ. In Arizona, for example, the adverse possession period is only two years, but in Virginia, it's 15 years. This process, often referred to as "squatters rights," doesn't happen as often as people may think but technically is a legal way to take someone's property by paying the taxes.
The Cost For Someone To Do Your Taxes In Canada
So how much does it cost to have someone do your taxes? The cost of hiring someone to do your taxes in Canada will vary based on the complexity of your tax return and the experience of the person or company you are hiring for the job. You may be able to find someone to prepare your taxes for as low as $50-$75; these might be individuals with a deep knowledge of the tax system who are looking to make some extra money during tax season, but you should do your due diligence to be sure they are experienced with preparing and submitting taxes.
If you have a more involved tax return including investments, expenses, and a number of deductions, you want to be sure you are hiring an expert to do the job. One important note to keep in mind is that when signing over an individual or company to prepare your taxes for you, is that you are liable for any mistakes (even accidental) that might occur in the filing. With that in mind, you always want to be sure you are in good hands. One way to alleviate that stress is to hire a specialized tax preparation expert, an accountant, or a bookkeeper to file your taxes.
Hiring an expert will cost more (anywhere from $100 – $500+ depending on your tax situation and the work involved) but might actually save you money. A tax expert will be fully aware of all the potential deductions appropriate to your situation, and will understand the type (and amount) of expenses you can claim, which may increase your tax return. While hiring an expert to do your taxes is more costly, their expertise and experience may get you a better return, and will alleviate any tax stress by knowing you’re in experienced hands.
Anyone you’re hiring to do your taxes will be able to get you a quote of what the preparation will cost; they’ll ask detailed questions about your tax situation which will provide an idea of the complexity of your case and the amount of work required. If it’s your first time paying someone to do your taxes, feel free to shop around to get the best price or the preparation expert you feel the most comfortable with. Just don’t wait too long; many of the best preparation experts will be booked up fast as Canadian tax season approaches, so start reaching out by early January to be safe.
they already pay enough
Although I believe loopholes should be closed, I do not believe rich people should be required to give a higher percent of the money they worked for to the government. Why should they? When you go to the grocery store they don’t ask you how much you make just so they can raise your bill and make more money off of you. Why should the government do it?
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Benefit from HR Block’s tax expertise
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You have a complicated or changing business
Different industries have different tax needs. An in-home day care provider seems like a pretty straightforward business, right? Well, when it comes to taxes, things can get very complex.
How much of your new microwave can you deduct? Do you get to claim the time spent cleaning after hours? If your business involves storing inventory or using your own home as the main office, you often must use complicated formulas to figure your deductions. Getting it right ensures you see the most money in your pocket (and avoid audit problems).
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Tax Preparation Software
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The Final Decision
Keep in mind that you'll still have to do a lot of the work yourself, even if you hire a professional.
Start gathering and organizing your 2021 tax documentation as soon as you can so you'll be prepared when it's time to file.
It's up to you to gather all your tax-related documents. The sooner you start, the more information you'll have at your fingertips to make the best decision.
You'll want to save time for reviewing your tax return for accuracy when it's completed, regardless of which route you take. A professional will certify accuracy and can help you down the road in a tax audit, but your tax return is only as good as the information you provide.
You'll also want to keep a copy of your tax return and related documents for at least three years in case the tax agencies have any questions.
The Main Reasons To Do Your Own Taxes
Doing your own taxes gives you the flexibility of going at your own pace. Although it takes me on average 2.5 hours to do all my taxes in one sitting, I like to draw out the process over a one month time period. Tax documents are always late and I expect last minute law changes.
The greatest benefit about doing your own taxes with online software is that you can play with the numbers to see where you can optimize your tax liabilities for next year. For example, I’ve made steps to eradicate expensive W2 income and increase dividend and passive income sources to minimize tax liability.
3) Easier To Cheat / Fudge Some Numbers
It’s hard to fudge numbers or cheat on your taxes if you get someone to do your taxes because CPAs put their reputation on the line when submitting your returns. You can find an aggressive accountant, however, who knows your own risk tolerance better than you?
If you want to fudge some numbers because you can’t track down a tax document or receipt, it’s easier when you file yourself. Just be prepared to get the smackdown if you live too dangerously and intentionally try to evade taxes. I do not advise breaking the law. However, as you’ll see below, if you cheat on your taxes you could win one of the most powerful jobs in the land!
Fock Or Be Focked
There is no way out when it comes to paying taxes. Review all the reasons to do or not do your own taxes above and figure out what resonates with you. The best thing you can do for your finances is weigh the pros and cons to decide which way makes you the least unhappy.
The folks who tell you they are happy to pay taxes don’t pay much at all. Don’t listen to them. You are a fighter who plans to build great wealth through knowledge. Just be careful what you wish for.