When To Let A CPA Help With Your Taxes
When you're first starting your working career, you can often get by with doing your own taxes since your life is still pretty simple. However, when your life becomes more complicated with kids, divorce, and investments, it is often a wiser choice to hire a CPA to handle your tax matters. Here are some situations that signal it's time to bring in a CPA to do your taxes.
You Have A Major Life Change
If you buy a house, sell a house, get divorced, or become widowed then you may need help with your taxes so you take all the deductions you're entitled to and pay fewer taxes as a result. A CPA keeps you from paying more than you need to and he or she also makes sure you pay what is required. This keeps you from making mistakes that could get you in trouble with the IRS or result in a shocking bill to settle your outstanding taxes. The IRS goes over your tax return and they can make changes as they see fit. If they are not done properly, you'll receive a bill for the difference. It's best to avoid such a shock by making sure your taxes are done right the first time, especially when rare life changes happen that you are not used to dealing with on tax forms.
You Start A Home Business
Even if your home business is a small one, you'll still have to pay business taxes. When you have your own business or when you work as an independent contractor or freelancer, you'll want to work with a CPA all year long so you pay quarterly taxes on time and plan your taxes and income accordingly. If you don't, you'll face a large bill at tax time and you may even have to pay fines. Business taxes can be complicated and take deductions for a home office might trigger an audit if you make mistakes. Hiring a CPA for business taxes is a wise way to reduce the amount of taxes you have to pay in a legal way so your money and your business are protected.
You Have A Lot Of Investments
Once you accumulate enough wealth to have a variety of investments, filing your taxes becomes more complicated. Working with a CPA throughout the year is beneficial when you have a large portfolio of different investment types. A CPA can even double as a financial adviser so you invest your money more wisely. He or she can also guide you if you give money to charities, kids, or friends as cash gifts.
Since getting a large refund or reducing your tax bill are important goals at tax time, it never hurts to work with a CPA for the best results that don't cause problems with the IRS. A CPA can also help you with an audit if it ever occurs. To learn more, contact an accounting company like Burkhart Peterson & Company.