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Serious question. We are married with two kids. Our return is fairly simple. We have a house with a mortgage, both have W2s, bank interest, student loan interest nothing else. So, W2s and interest are income. Property taxes, property taxes and mortgage interest along with child credits are deductions.
I bought H & R Block tax software. We owe about $14k since one of her two W2s withheld little to no taxes and my job took about 10%. So, we underpaid and for the first time ever, got hit with a $400 penalty for underpayment throughout the year. What could a CPA do that HR Block software can’t do? It’s pretty cut and dry. My friend said I should use his guy that charges $650. That seems crazy to me. My accountant never charged more than $150 and that was for our joint return and my old side business return but got sick and is no longer in business. So, why hire a CPA if the software does the same thing? Thanks for any replies.
Serious question. We are married with two kids. Our return is fairly simple. We have a house with a mortgage, both have W2s, bank interest, student loan interest nothing else. So, W2s and interest are income. Property taxes, property taxes and mortgage interest along with child credits are deductions.
I bought H & R Block tax software. We owe about $14k since one of her two W2s withheld little to no taxes and my job took about 10%. So, we underpaid and for the first time ever, got hit with a $400 penalty for underpayment throughout the year. What could a CPA do that HR Block software can’t do? It’s pretty cut and dry. My friend said I should use his guy that charges $650. That seems crazy to me. My accountant never charged more than $150 and that was for our joint return and my old side business return but got sick and is no longer in business. So, why hire a CPA if the software does the same thing? Thanks for any replies.
A CPA may use different professional software. you have to ask.
If your taxes are simple, from wages & interest. may not pay to have CPA do it. Ask what the $650 fee is from, in time or what. For a 1040 & a schedule or so with standard deduction may not cost so much.
Serious question. We are married with two kids. Our return is fairly simple. We have a house with a mortgage, both have W2s, bank interest, student loan interest nothing else. So, W2s and interest are income. Property taxes, property taxes and mortgage interest along with child credits are deductions.
I bought H & R Block tax software. We owe about $14k since one of her two W2s withheld little to no taxes and my job took about 10%. So, we underpaid and for the first time ever, got hit with a $400 penalty for underpayment throughout the year. What could a CPA do that HR Block software can’t do? It’s pretty cut and dry. My friend said I should use his guy that charges $650. That seems crazy to me. My accountant never charged more than $150 and that was for our joint return and my old side business return but got sick and is no longer in business. So, why hire a CPA if the software does the same thing? Thanks for any replies.
I suggest that you do it yourself. Your situation is very simple, and you could likely fill out the forms in less than an hour. You can get the forms you need at the Post Office or request them online directly from the IRS website.
If you want some guidance, I'm sure that H&R Block or TurboTax (which I use) would be a cheap method of doing them online. Depending on your total taxable income, the online procedure might even be FREE. Or perhaps you might have to pay $75 or so at the worst, IMO.
It doesn't sound as if you need to pay for a CPA; you just need to make sure you either increase your withholdings on W-2 income or send in quarterly payments.
Run turbo tax and see for yourself. You don't pay until you file. Even when I was a landlord I still used turbo tax, plus I had brokerage account transactions that TT would import.
I'd also suggest you run the IRS withholding calculator ASAP to make sure you're not behind in withholding again. I tend to run it several times a year to make sure I'm on track.
I was going to say the same thing davebarnes said. We have an Enrolled Agent. They take a special IRS exam and specialize in tax.
For your situation, you could easily do it yourself. If you do decide to hire a professional, definitely though consider Enrolled Agents.
For years I did our own taxes. We started using our Enrolled Agent when we had some complicated situations come up, were super busy with our careers and family, and boy was our guy worth his weight in gold. We had a period of six years where he saved us thousands of dollars for doing some things we would have never thought of on our own (to take certain deductions we actually saved a ton of money by filing separately as with a joint return as we wouldn't have been able to take the deductions because they didn't meet percentage thresholds with our combined incomes). Usually because of the higher tax rates for married filing separately this is not something you'd want to do, and it's not something I would have thought of to do on my own. And how nice to have someone else handle a letter from the IRS (keeps my blood pressure from going up and he handles stuff like this every day). One year too when we were totally in the right and the IRS was demanding money (computer glitch thing) and the IRS just wasn't responding / giving this any attention, our Enrolled Agent knew to make an appeal to an IRS ombudsman who took our case and got the IRS to agree we were in the right.
These days we could do our taxes ourselves instead, but I like being able to talk to our Enrolled Agent about different things though out the year. And this is going to be more and more important to me, as I may be needing to do taxes for others as their power of attorney and may be handling some other complicated Trust issues as a Trustee for a Trust with a long distribution timeframe, so it's really nice to have a good person to work with.
In your shoes, I'd probably try it myself first. But know if your tax situations get more complicated an Enrolled Agent can be super helpful.
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