Tax season 2024 is here and millions of Americans are at a crossroad – deciding between handling their tax returns on their own or through contracting a tax professional. While we always think there’s value in using a knowledgeable and reputable tax professional to prepare your return, there are some taxpayers who have a simple enough financial situation where they can do it comfortably themselves.
Doing your own taxes
Preparing your own returns can be beneficial if you have uncomplicated assets, or you enjoy the task of combing through your finances and understanding the nuances of tax credits and deductions. For example, a single person with no dependents, one W-2 employer and owns a home might feel comfortable going it alone. However, once your financial situation begins to add layers of complexity, there are tax credits/deductions and even reporting requirements you may not be aware of. That’s when we think it’s best to bring in the professionals.
Should I use a tax professional to do my taxes?
The short answer is, yes, if you aren’t familiar with using an online tool to help with your return or if you have questions about whether you qualify for certain tax benefits. Additionally, if you use a tax professional, they may be aware of credits you qualify for that you’re unaware of. They can also help you with important tax planning aspects of withholding, retirement, starting your own business or saving for college.
Here’s a handy flowchart to help you make your decision.
What do I need to bring to my tax appointment?
When visiting a tax preparer, it’s essential to bring all relevant documents and information to ensure accurate and efficient tax preparation. Here’s a list of items you should consider bringing:
1. Personal information
- Social Security numbers for yourself, spouse and any dependents
- Identification (driver’s license or other government-issued ID)
2. Income documents
- Forms W-2 for all jobs worked during the tax year
- Forms 1099 for any additional income (contract work, poll worker, jury duty, freelance, dividends, interest, etc.)
- Schedule K-1 if you have income from partnerships, S corporations or trusts
3. Proof of deductions
- Receipts for any charitable donations made during the year
- Documentation for any medical expenses
- Mortgage interest statements (Form 1098) if you own a home
4. Business and self-employment documents
- Business income and expense records
- Receipts for business-related expenses
5. Education expenses
- Form 1098-T for tuition paid
- Records of any student loan interest paid
6. Retirement savings
- Forms related to contributions to retirement accounts (e.g., 401(k), IRA)
7. Health insurance coverage
- Form 1095-A, 1095-B or 1095-C, indicating health insurance coverage
8. Child and dependent care
- Documentation of expenses related to child care or dependent care
9. Homeownership documents
- Property tax statements
- Closing statements if you bought or sold a home during the tax year
10. Other relevant documents
- Any other documents related to income or expenses that might affect your tax situation
It’s important to note that this list may not cover every possible scenario, so you should consult your tax preparer before meeting with them to ensure you bring all necessary documents specific to your situation.
Happy tax season!
