When is it time to hire a tax professional?
We hear weekly on social media people lamenting:
1) their inability to find a tax professional; and,
2) the cost of hiring a tax professional.
Because of this, when clients come to Seamless who we truly think will be overpaying for our services, we always communicate that. Conversely, though, there are some situations though where we always recommend hiring a tax professional:
Multiple state activity - you have income from multiple states that need to be reported & filed
Pass-through K-1s - these are documents reporting activity from another entity you are an owner of - because of different rules around income and expenses that are passed through, a tax professional is almost always necessary to make sure the activity is being reported on your personal return correctly
Rental properties - 1,000% of the time I see taxpayers mess up depreciation on their rental properties - usually to the tune of underreporting it, thus losing our on tax deductions, or even worst, over reporting it, and understating income
Anything involving foreign activity & bank accounts - there are special forms for reporting that need to be filed that have STEEP penalties if they’re not done - this is a specialized area and even I as a tax professional don’t offer that as a service
Partnerships, S-Corps, C-Corps - Just flat out don’t even try and self-prepare business returns. Even some tax professionals won’t do them because of how different rules are related to business taxes as compared to individual taxes.
Some Schedule Cs - this is more dependent on location that anything - but some locations have multiple state and local income taxes you need to be aware of, and as a non-tax professional it can be difficult to keep up on them. In Portland for example, there are multiple taxes that self-employment income trigger, and usually when a former self-prepared taxpayer comes to me, they have missed one or multiple years of tax filings they were supposed to do.
