Is a DIY Approach Best For Your Business Taxes?
For all the procrastinators out there, we’ve decided to put together a short series tackling the looming tax deadline. We’ve gone over a W2 employee versus a 1099, and the all-too-confusing book of tax deductions. Today, though, we’re going to address the DIY’er in you, too – should you see a CPA or do it yourself?
If you’ve never used a service like TurboTax, you’d probably be surprised with how easy it is to use and how thorough it is. Tax preparation software makes filing your taxes extremely simple, and more recently, these services have added lots of ways to get help when you need it from CPAs.
That being said, a piece of software can have all the FAQ sections, live chats, video chats and hotlines to call in the world… but it still isn’t the same as meeting face to face with a CPA who knows you by name and knows your business. So, which do you go with?
Well, if you’ve planned your taxes out correctly during the year, the process of filing should be a mostly automated process. You’re not thinking much; you’re just filling out the applicable forms and submitting it. For most individuals that work one full time job, filing your taxes should be beyond simple and therefore there shouldn’t really be a reason to use a CPA.
But, as a small business owner, your situation might be a little more complex.
Most small business owners will have a lot of variables, and it would be beneficial to have an actual person parse through the information to find your best return.
Now, while TurboTax and other software like it offer services like audit protection, if you file with a good CPA, you probably won’t need to have a service like that. If your CPA does their job well, they won’t file something that would get you audited in the first place.
As a largely automated service, most tax prep software must offer audit protection in order to be in business. You’re far more likely to make a mistake or raise suspicion as an untrained eye filing with tax software.
In the end, to determine which way to go, you need to ask yourself this question: how simple will my return be?
If it’s super simple, like it would be for a single person working one full time job, then you don’t need a CPA. If you’re a small business owner, with a family, complex income structure, expenses, employees, etc - you’re best served going with a trained eye and a personal touc