MEDIA ALERT — When is it time to turn your tax preparation over to a professional?

Wolters Kluwer Tax & Accounting looks at when taxpayers may be advised to get professional help with their tax returns

Wolters Kluwer Tax & Accounting (AEX:WKL):

What: While some taxpayers use consumer tax return preparation software to prepare their own tax returns without the use of a tax professional, many also find that as their lives move beyond the simple receipt of a Form W-2, they get less comfortable responding to the tax software questions completely and accurately. And, as peoples’ lives and the tax laws continue to get more complicated, the process of completing and filing your income tax documents becomes more complicated, as well.

Why: At some point, many taxpayers including those who have started off using consumer tax return preparation software decide that the time has come to shift to a tax professional. Here are some of the factors that might play into this decision.

• Comfort level. Some people enjoy working through a tax return and some do not. If you find that working through a tax return causes you anxiety and discomfort, a professional may be able to help
• Complexity of your life. Almost all aspects of life can add complexity and changes to a tax return - marriage and divorce, children and their education, starting your own business, property or business activity in more than one state or country, significant investment transactions, charitable giving, health, death of a spouse, or retirement. These life circumstances may raise tax questions that you haven’t encountered in the past
• Tax law complexity. Tax law complexity is not just an issue for wealthier taxpayers. The Earned Income Tax Credit, the Child Tax Credit, the Dependent Care Credit, and the Recovery Rebate Credit, among others, can all come with complexities for lower income taxpayers and result in issues with the IRS if not dealt with correctly. If you have made mistakes on your tax return in the past, it might be time to consider professional help
• Tax advice. Increasingly, the tax return is something that should be kept in mind throughout the year. Year-round planning can pay off at tax filing time and having a tax professional to assist with that planning throughout the year, not only for the next tax return but future years as well, can be a significant tax benefit
• Resolution of tax issues. If a dispute does arise with the IRS, even if you’ve done your own tax return, it is generally advisable to get professional assistance to help you through the IRS audit process and even potential litigation
• Time availability. As life goes on, the demands on your time tend to increase. The home improvement project that you might have done yourself is turned over to a contractor or you may decide to outsource your lawncare to professionals. Taxes are another time-consuming matter that at some point might be best to turn it over to an expert
• Money. While hiring a tax professional may cost more than buying consumer tax software, time savings and the potential for additional tax savings should also be considered in the calculation

Who: Tax expert Mark Luscombe, JD, LL.M, CPA, Principal Federal Tax Analyst at Wolters Kluwer Tax & Accounting, can help discuss these and other relative benefits of hiring a tax professional rather than using consumer tax software to complete and file your tax documents.

PLEASE NOTE: The content of this article is designed to provide accurate and authoritative information in regard to the subject matter covered. The information is provided with the understanding that Wolters Kluwer Tax & Accounting is not engaged in rendering legal, accounting, or other professional services.

Contact: To arrange an interview with Mark Luscombe or other federal and state tax experts from Wolters Kluwer Tax & Accounting on this or any other tax-related topics, please contact Bart Lipinski.

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