Tax Professional or ‘Do-it-yourself (DIY)’?
As a financial industry professional, I find this an interesting topic to review. I am not a licensed Certified Public Accountant (CPA), but I have a BA in Accounting and I have successfully passed all parts of the CPA examination. More importantly, I can relate to the typical taxpayer, in that I was born without qualified tax knowledge.
When I was young, I used to think, ‘Why would I waste some of my potential refund dollars on a tax professional when I believe I can figure this tax stuff out myself?’ And when I was young that made sense (…no dependents, no real estate, no home office or home office expenses, no capital gains, no other income from partnerships or LLC’s – nothing too complicated). Now that I have grown up a bit, my thinking has changed.
Sure, once per annum, DIY preparers can purchase software that makes a valiant effort to navigate them through some of the tax situations mentioned above, but it is not the same as sitting down with a professional and reviewing one’s finances as a whole. The micro and macro assessment of your particular financial situation provided by a trained professional is not something a tax software (used by a novice) can provide. At least not at the same level of quality. (When I state trained professional, I am referring to a CPA, CFP, PFS or of similar qualifications. Not an H&R Block or similar ‘fast-food’ trained preparer – i.e. don’t expect filet mignon from McDonalds!).
Unless you’re very young, childless and/or, have very few assets, in my humble opinion you need a financial plan created & implemented with the assistance of a finance professional. Financial professionals did not spend hundreds of hours and thousands of dollars in education and qualification because it feels good. Instead, this time and money was spent to have an understanding and competence in the intricacies of financial matters.
Tax preparation is often viewed as a duty or task that must be completed by a certain date (or if you’re expecting a refund – something you want to file asap!). And yes, your taxes need to be filed timely or put on extension, however, this article is designed to help the reader view tax preparation as a component of a larger process, or better yet a plan… a financial plan. Find an advisor (http://accountantdirectory.com) and begin developing your financial plan today!
By Leon Clinton