A note from Bookly CEO Zach Olson:
I remember how naïve I was my first year in business. As a sole-proprietor, I thought I could handle my small business taxes all by myself. It was just filling out a Schedule C along with my form 1040, right? How hard could that be?
Well, as it turned out, a lot harder than I thought. I did end up filing my own taxes that year, but I have a feeling that if I went back and looked at that old form 1040, I wouldn’t be too happy with myself. I’m sure I missed a lot of deductions I could have taken, and I’m sure Uncle Sam is happily spending money that could have come back to my pocket.
These days, I turn to a certified public accountant to take care of my taxes. Why hire a professional? These are just a few of the good reasons I’ve found:
1.) Peace of mind – With a professional you know that your taxes and other accounting duties are going to be taken care of right, and on the first go round. If left to my own devices, I’ll procrastinate until April 14th to start fumbling around for my tax paperwork. I have peace of mind knowing my tax return is in a pro’s hands.
2.) Tax breaks – When’s the last time you randomly read about a new tax break for small business owners? (Or parents? Or students?) You may have seen something in passing on the news, but who has time to delve into the annals of the IRS and really dig out the nitty gritty? Your accountant, that’s who! A professional keeps abreast of the tax breaks available to their clients, so you can spend your time doing other things – like running your business.
3.) Mistakes are costly – Have you ever made a mistake on your taxes? …Are you sure about that? I, for one, have had to shame-facedly file a 1040X on at least one occasion. A pro, though, will be less likely to make a mistake on your taxes. And if, for some reason they do, they will often fix it for you at no charge. No more wasting your time making your tax return and checking it twice.
4.) In case of audit – If the government does come calling, you want someone on your side who knows what she’s doing. Mistakes you make during an audit – such as providing too much information – could compound your trouble. Turn to a professional should you ever find yourself the subject of an audit.
5.) Keeping up with changes – “The mileage rate is 55 cents per mile right? That sounds about right,” you think to yourself as you jot down a note in your bookkeeping app. Except that the amount you can deduct per mile driven for business actually changes per year, and sometimes more often than that. (In fact, the current standard mileage rate is 56 cents!) Little things like this change up from year to year, but they can add up to big mistakes on your taxes. This is why I let an accountant take care of it.
Personally, I think hiring a professional to help me with my taxes beats tearing my hair out over esoteric IRS instructions and obscure tax law changes any day. Do you use an accountant, enrolled agent or other tax preparer to help with your taxes? Tell us in the comments!