In certain cases, you may want professional help for your
tax return. You are well-advised to get professional help
if you have:
- A high income
- Large real estate investments
- Numerous and complicated investments
- A major life change
- A new home
- A new job that requires a lot of travel
If your financial life is simple and straightforward, you
probably don't need to pay someone to prepare your taxes.
But the more complex your tax return, the more likely it
is that a skilled tax advisor will help you find savings that
will easily pay for his or her fee.
Those with less complicated tax returns may choose to get
help for the convenience, to save time, or just because they
don't want to deal with tax forms.
To help you decide what kind of help best suits your needs,
here is a summary of your options and the situations in which
they are most helpful.
Tax Preparation Houses
Tax preparation houses are the factories of professional
tax help. They are best suited for variations on a one-size-fits-all
solution for people with simple to moderately complicated
returns.
Their strengths are price and convenience. Often your return
can be completed on the spot for a low price (as low as $100).
But tax houses also offer the lowest service; therefore, don't
expect much advice on how to reduce your taxes or other help
in approaching your tax bill.
Certified Public Accountants (CPAs)
Certified Public Accountants who specialize in taxes can
be the best advisors for filing complicated returns and finding
ways to reduce your taxes. CPAs are required to pass extensive
exams on financial matters and must continue their education
to stay abreast of current changes to the tax code.
This kind of help comes at a price: the services of a competent
tax accountant will easily cost $700 or more, depending on
how much time your return requires and the reputation of the
firm.
You can minimize your cost by keeping your tax records well-organized
and well-documented.
To find a CPA in your area that specializes in taxes, go
to CPAlink.
Enrolled Agents (EA)
Enrolled agents (EAs) are former IRS employees, or individuals who have passed tax exams and an IRS background check and are licensed by the federal government. They can be less expensive than CPAs and offer you more services/help than Tax Preparation Centers. EAs can prepare taxes, advise you on tax-related decisions, help you in the event that you?e audited, and even represent you before the IRS.
To find an enrolled agent in your area, go to www.naea.org.
Tax Attorneys
Tax attorneys can help with any legal matters affecting your
taxes, suggest legal structures (such as setting up trusts)
that help minimize your tax burden. You should talk to a tax
attorney for advice on specific tax matters related to a marriage,
divorce, or estate planning.
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