Tax Preparation

Tax preparation finest left within the arms of execs | Finance

Each year, when tax season comes around, people have a choice to make. Should they file our own taxes or hire a tax advisory firm? Filing your own taxes can save a lot of money if you have the time and capabilities to do it correctly, but that isn’t always the case.

Often, people find that their once-simple tax documents have become too much to handle or a business’s growth leaves them with too many assets and details to keep track of. When this happens, they might start seeking help from a tax professional.

David Reape, principal and director of tax services at HW&Co in Beachwood, Angel Rice, tax director at Cohen & Company in Cleveland, and Melanie Ross, senior financial advisor at NCA Financial Planners in Mayfield Heights, offered reasons why a tax prepare should be used .

“If your situation becomes too complex and you don’t have time or patience, seek out a tax adviser,” Ross said.

Ross said when a person goes from a simple W-2 to a 1099, in which they have to factor in things like social security, it might be wise for them to seek a professional. She recommends interviewing at least two to three tax professionals who are well-versed in their jobs. Asking questions about their experience, the cost of their services, how quickly they file and whether they file via internet or paper will help a person decide who will best accommodate their specific set of needs.

“If you’re a business and you get really large and you’re not comfortable handling all the tax forms, tax advisers know all about that,” Ross said.

Ross said there are more than 60,000 pages in the US Tax Code, which may be overwhelming for a non-professional. Tax advisers’ knowledge of the laws helps them to file a person’s taxes with less risk of a mistake that could result in interest or other penalties.

“Once you move beyond the simple W-2 (and) mortgage interest, keeping up with the tax law changes and how the provisions work, you could spend, as an individual, a lot of time and effort to try to keep up,” Reape said.

A tax adviser’s job is to pay attention to the federal, state and local changes so they can help you and point out when there are changes that impact you, Reape said.

Research is also important when considering options for tax advisory firms.

“I would definitely look them up online,” reape said. “See what their virtual presence is. He further recommended visiting the websites of the Ohio Society of CPAs and the IRS, both of which have information on how to find an adviser.

“Schedule K-1’s are an easy marker for folks to know when they should get a tax adviser,” Rice said.

Rice stressed the importance of finding a firm that has advisers with experience in a variety of areas so that, even if your adviser doesn’t specialize in a certain aspect, they can consult a colleague who does.

“Utilizing a firm that has expertise in different areas helps ensure you are getting the best advice,” Rice said.

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