Of course, you don’t have to be a certified public accountant to file an income tax return. But, there are many times when it pays to have a local CPA on your side. Whether you are newly married or just opened a business, you have a lot to gain by hiring an accounting firm.
9 Times when Hiring a Local CPA is a Wise Decision
1) Marriage, Divorce or Adoption
If you have had major life changes in the past year, it might make sense to have an accountant to review your tax return. Whether you are changing your filing status or not, there are many tax deductions and tax credits you may be able to claim. Those who have married, divorced or adopted children might also benefit from making adjustments to their financial planning.
2) Multi-state Residency or Employment
For those who work or live in more than one state, a tax return can get complicated real quick. Not only will you be taxed at different rates, but you may be responsible for allocating your income according to your residency or employment. As a result, income tax preparation can be complex and time-consuming if you are not a professional accountant.
3) Received an Inheritance
A change in income, like receiving an inheritance, is another reason to consider hiring a local CPA. Depending on how much you have received, you may be subject to the capital gains tax. Even if you have been bequeathed a moderate amount, it’s wise to double check you are not overpaying your taxes.
4) Real Estate Purchase or Sale
If you have bought or sold a house in the last year, it is a good time to confer with a certified public accountant. There are many tax laws that apply to real estate. For example, your tax professional might be able to assist you with the mortgage interest deduction or the capital gains exclusion.
5) Small Business Owner
A small business owner is a perfect candidate for professional accounting services. There are many big and small tax rules that could ultimately affect the bottom line of your business. For example, an owner might learn how they can benefit from charitable donations, car and truck expenses or other tax incentives.
6) Freelancer or Consultant
Freelancers and consultants often hire a local CPA, because they must follow IRS rules for self-employment. Those who haven’t paid income tax throughout the year tend to have more complicated tax returns, which includes the self-employment tax that goes to Social Security and Medicare.
7) Rental Property Owner
Real estate investment can be lucrative, but it can also be tricky come tax time. There are many less-than-obvious tax deductions that you may be able to use to reduce your taxable income. If you have recently acquired a rental property, you could benefit from receiving tax advice.
If any of these situations apply to you, you might want to consider hiring a local CPA, who will be there to assist you every step of the way.