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5 Signs you need a tax professional

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Let’s be perfectly honest. Most of us haven’t a clue what we are doing when it comes tax time. Tax forms are confusing, and navigating the maze of rules and regulations regarding our tax returns can be difficult to say the least. Wading through tax records and filling out your tax return can be a daunting and time consuming task, especially if your financial situation is less than straight forward.

Professional tax preparers are paid to keep up with the tax code. And their expertise can help ensure that you get all the deductions and credits you are eligible to receive.Sometimes, it’s just a better idea to hire a professional. In this article we’ve assembled a list of 5 signs that you might need to hire a tax professional.

1. You have more than one source of income

If your job pays you an hourly wage and that is your only income, chances are your tax returns will be fairly simple and straightforward. On the other hand, if you are self employed and own a business, make money from investments, have multiple income streams of income, or any other income that doesn’t show up on a w-2, there is a huge margin for error present if you attempt to figure out your taxes by yourself.

2. There’s a mistake on a previous return

If there’s one thing you don’t want to make a mistake on, its definitely your taxes. If you’ve made a mistake on a tax return from the previous three years, a tax consultant can help you file an amended return. In doing so, you minimize the damage you may have caused. And, you also get a bit more peace of mind, knowing your return was filed properly this time.\]

3. You want to avoid an audit

IRS audits are not as common as one may think. In fact, fewer than 1% of tax returns are audited each year, and if you’re a middle income bracket, your chances of having your taxes scrutinized are probably slim. However uncommon they may be, audits do happen. One of the  greatest benefits of hiring a tax preparer, is that in most cases, that person will be available to provide support in the event that you end up having your return audited by the IRS. If you file your taxes by yourself, you’ll most likely have to go it alone if the IRS comes knocking for more information.

4. Your marital status has changed

If you’ve gotten married or divorced during the past year, your tax status will be affected. A tax consultant can help newly married couples make a determination as to whether it’s wiser for spouses to file jointly or separately. Every couple has a different tax situation, and it’s helpful to ask for a professional’s opinion as to  what will be most beneficial to both parties.

If you’ve recently divorced from your spouse, a consultant can help you determine if filing jointly or separately is best in this case as well. Generally, it’s recommended that you file separately so that one person can’t be pursued in the event that the other party has any delinquent unpaid taxes. A qualified tax consultant can also help you make sure that any alimony that may have been paid or received is properly reported to the IRS.

5. Tax law is complicated

Tax law has always been a maze of red tape, and even more since the 2018 tax overhaul. To this end, many accountants are struggling to interpret some of the major changes that have been made. If the professionals are having a hard time, it likely means that the average person will have an even harder time trying to interpret to those new laws.

By hiring a tax preparer, you’re paying for the insight and expertise of someone whose job is to stay abreast of those new changes in tax law.

The bottom line

When it’s all said and done, unless you’re single with just one source of income, it makes more sense in the long run to hire a professional to complete your tax return for you. You save time and money, protect yourself in the event of an audit, and save yourself the headache of trying to navigate the changes in tax law. It just makes more sense to hire a professional. Even if you end up spending upwards of $100 dollars to have your taxes prepared, it’s more than likely going to be worth it. And it stands to question: If you can avoid errors, save time and money, give yourself some peace of mind, and protect yourself from audit by hiring a professional, then why risk it going alone? The answer is you shouldnt. If you require the services of professional and skilled tax consultants, contact Silver Tax Group.

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