My Tax Preparer retired this year. Now what?
Some people actually enjoy preparing their tax return. If your return is fairly simple, that’s certainly an option. If you do it yourself, you can still obtain the paper tax forms and instructions and file by mail.
Or maybe you’d like to try using a computer instead. At this time of year you can’t avoid tax software commercials. Millions of people spend quite a bit of money for these programs. But it seems to me that very few people really benefit from them:
If you earned less than less than $57,000 last year, you can use the tax software at the IRS website for free. And many states, including Illinois and Wisconsin, allow you to file state tax returns at their websites for free. If you’re single, taking a standard deduction, and your only income is from your paycheck, you can do it yourself without buying any software.
If you don’t qualify for free filing, you might consider buying tax software. Although they’ve improved, these programs are still written for “ordinary situations” and your situation might be a special case. Despite the checklists built into the software, you still need to know how the deductions, credits and other terms apply to you.
Remember, the tax law can get complicated in a hurry. Taking the wrong deduction or passing one up can be costly. But if you know what you are entitled to, and you want automatic calculations, think about buying a program. Professionals rely on tax software to save them time. But just remember, you’re preparing one return, not hundreds. You can do the same thing using a paper form and a calculator for free.
If you need a professional preparer, you have a lot of options. Obviously, it’s more expensive to use a preparer than doing it yourself, so you’ll want to be sure you’re getting your money’s worth.
Sometimes it’s hard to tell a really good provider from a mediocre one. First and foremost, a professional preparer should care about you and be trying to help you save money this year and offer suggestions for lowering next year’s tax bite. It’s perfectly acceptable to ask someone how long they have been preparing returns and where they learned their trade.
You can ask respected friends, neighbors, and relatives who they use. Many of the best preparers don’t advertise, but rely on referrals from satisfied clients. It’s ok to ask a preparer about fees, but remember that tax returns vary greatly and complex ones cost more than simple returns. You may be quoted a range or a minimum fee.
While it can be hard to find a good preparer, it’s easy to spot a few that you should avoid: Some commercial preparers focus on having “fun” while filing your return. While a preparer should put you at ease and be pleasant, your tax return is not a joke. You worked hard for your money last year. Paying the least amount of tax is not a laughing matter.
If a professional preparer offers to prepare your return “for free,” ask yourself how the preparer earns a living. Rest assured, there is a catch.
If the tax preparer offers you an “instant” refund, keep walking. Many preparers, especially the large chains, make their money on refund anticipation loans. They charge as much as sixty percent interest. Does a preparer who offers you that “service” truly have your best interests at heart? . Do you really want their advice?
E-filed federal and state tax refunds ordinarily take about 2-3 weeks. If you must have the money quicker, take a cash advance on your credit card.
When you do find a good preparer, stay put! Playing musical chairs to save a few dollars on fees is an excellent way to introduce an error on your return. It’s much easier for a preparer who knows you and is familiar with your circumstances to be sure you got all the deductions you deserve. Good preparers save their clients many times over the amount of their fee.
