Is Filing Taxes With An Accountant Worth The Cost?

DATE_PUBLISHED

Is Filing Taxes With An Accountant Worth The Cost?

Every year at tax season, people have to make a decision: should I file my taxes on my own or hire an accountant to help me? Of course, both choices have pros and cons, and ultimately it comes down to a cost-benefit analysis. At the end of the day, what matters is whether you are getting the most out of your tax return. Depending on your circumstances, a tax professional may be in your best interest when tax season rolls around. 

Here, we'll lay out some major considerations to help you decide whether it’s worth it to hire a tax professional to file your taxes.

The Cost of Filing Taxes With An Accountant

The cost of hiring an accountant varies depending on a number of factors, including the complexity of your taxes, where you live, and the demand for accounting services in your area.

That said, according to the National Society of Accountants’ 2020-2021 Income and Fees survey, the national average is $220 for a Form 1040 claiming the standard deduction or $323 for a Form 1040 plus itemized deductions on Schedule A. 

That figure is just for a simple tax return. Once you venture beyond, the circumstances become more complex. If you’re married, a freelancer, have investments, and more, your tax situation would require more work from an accountant. However, that comes with the assurance that your complex taxes are filed properly. 

For example, if you’re a freelancer or run your own business, you may not be taking advantage of some tax credits due to the constant changes tax codes undergo annually. 

Some other forms and schedules that will result in fee increases include:

  • Schedule F to report income from a farm
  • Schedule C for income from a sole proprietorship or single-member LLC
  • Schedule E for income from rent, royalties, or a pass-through business
  • Schedule D for capital gains and losses
  • Schedule H to report taxes for a household employee
  • Claiming the earned income tax credit
  • Reporting interest and dividend income on Schedule B
  • Schedule SE for self-employment taxes
  • Owning foreign bank accounts or investments or receiving foreign income

The Benefits of Filing Taxes With An Accountant

Despite the cost, several benefits come with hiring an accountant to help with your taxes.

Expertise

When it comes to your taxes, you want to make sure you're doing them right. Tax pros are experts in the field, so you can rest assured knowing that your taxes are being done correctly.

Plus, they know the tax code in and out, so they can help you find all the tax deductions and credits you're entitled to.

Time Savings

Secondly, they can save you time. Doing your taxes yourself can be a lengthy and involved process. In fact, according to the IRS, the average non-business taxpayer spends nine hours on tax preparation per year, including recordkeeping, tax planning, and completing and submitting forms.

An experienced accountant can get the job done quickly and efficiently, so you don't have to spend hours dealing with complicated tax rules and forms.

How to Choose the Right Accountant For You

You can find a tax accountant by asking friends and family members for a referral, searching the IRS directory, or checking with your state CPA society. You can also use Taxfyle to connect with a tax expert who can prepare and file your taxes for you.

When choosing a tax accountant, you'll want to consider the following:

  • Are they qualified? You'll want to ensure that your accountant is qualified and licensed to prepare taxes in your state. You can check their qualifications on the IRS website or through your state board of accountancy.
  • Do they have experience in your industry or niche? Not all accountants are familiar with every industry or niche. If you own a business or have a unique tax situation, make sure that your accountant has experience preparing taxes for companies in your industry or people like you.
  • Do they have a good reputation? Ask around to see if anyone you know has used the accountant before and what their experience was like. You can also check online reviews to get an idea of their reputation.
  • What software programs or tools do they use? Many modern accountants now use software and apps that make it easier to collaborate with their clients. For example, will you have to mail or hand-deliver your documents to your accountant at tax time, or do they have apps that allow you to securely send documents and electronically review and sign your return? Using these tools can save time and trips to their office, so it's a good idea to look for someone who invests in these technologies.
  • How much will it cost? Ask about the cost of services upfront so you know what to expect. When it comes to billing for their services, some accountants charge by the hour, while others offer a flat rate for certain services. It's important to discuss billing with your accountant before they begin work so there are no surprises down the road. Many accountants offer a free consultation so you can discuss your needs and get an estimate.

What To Do If You're Not Happy With Your Accountant

If you already have an accountant and you're not happy with their service or fees, you don't have to stay put. There are a lot of great accountants out there, so take some time to find someone who will be a better fit.

Your new accountant will likely ask for copies of the last two or three years of tax returns, so make sure you get those from your old accountant.

So, is hiring an accountant to help with your taxes worth the cost? Ultimately, this is a decision that you'll have to make based on your individual circumstances. If you have a complex tax situation or simply don't have the time to do your taxes yourself, it may be worth paying for professional help. However, if your taxes are relatively simple and you're comfortable doing them yourself, you may be better off saving money by going the DIY route.

How can Taxfyle help? 

At the end of the day, the feeling of knowing your taxes are filed on time and properly is satisfying. Doing it yourself, not so much. With Taxfyle, you don’t need to worry about filing your taxes yourself because we have a Tax Pro that can file for you. 

Don’t worry about procrastinating on your taxes and cramming for all the latest tax changes. Our Pros will take the work off your hands at an affordable rate. 

Subscribe to Taxfyle Resources & Tax Tips

Get the latest posts delivered right to your inbox

Thank you for subscribing!
Oops! Something went wrong while submitting the form.
Is Filing Taxes With An Accountant Worth The Cost?
Personal Taxes
We'll lay out some major considerations to help you decide whether it’s worth it to hire a tax professional to file your taxes.
5 Minute Read
What Happens If You Get Audited And Don't Have Receipts
Personal Taxes
There are still things you can do like consulting a tax professional and keeping your files organized, to successfully navigate an IRS audit
4 Minute Read
How to Reach a Live Person at the IRS
Personal Taxes
We know speaking with someone at the IRS is difficult, but follow these steps, and you'll be talking to a live person in no time!
4 Minute Read

File simpler.

File smarter.

File with Taxfyle.