Benefits of having a Tax Professional
The IRS announced the start of the 2021 tax year last January 24, 2022. When the IRS sounded the horn that signals the beginning of the tax filing season, most taxpayers are faced with the question of whether they should do their taxes at home or if they should hire a tax professional to do it for them. Some might say that they can do their taxes themselves without the need for any professional to help them. But is the US tax code really that simple that you don’t need to have a tax professional do your taxes for you?
Turns out the answer is not so simple!
DIY Tax Preparation
Taxpayers who choose to do their own taxes think that filing their taxes simply means that they have to answer the questions included in whatever form they think is applicable to them. They are partially correct; however, the US tax code is not as simple as they think it is. The US tax code is getting more and more complicated as the years go by.
Drake Software is a Professional Tax Software company that conducted a survey and they found out that around 46% of paid tax preparers did not have any professional designation. Compare that to the 29% of taxes filed by CPAs and 26% filed by Enrolled Agents.
Having someone with no professional designation to file your taxes for you is as dangerous as filing your taxes yourself without even flipping through the first page of the US tax code. Professional designations are provided to Accountants and Enrolled Agents because they have shown a high level of competency when it comes to dealing with the ever-evolving landscape of tax rules and policies. Going through the maze of taxes without the proper knowledge, continuing professional education and experience can have you facing hefty interest and penalties.
Tax Professionals
If the US tax code is as complicated as it ever was, going to a tax professional to do my taxes is the right move, right? The answer to that is also not as simple as it seems. Tax professionals are given the designation because they have shown a high level of competency in dealing with the tax code when they were tried and tested. However, not all tax professionals are created equal.
For example, out of all the registered tax professionals in the country, only 41% have finished their Continuing Professional Education coursework, the other 48% are yet to finish their CPE coursework. Meanwhile, only 47% of tax professionals say that they have studied the latest changes in the tax law that will affect the upcoming filing season, the other 53% say that they haven’t gotten to studying the changes yet according to the survey conducted by Drake Software.
Competency
Competency is not the only criteria to becoming a trusted and effective tax professional. Since tax professionals are dealing with sensitive financial information, you must choose someone that takes good care of them and makes every effort to keep your sensitive financial information away from prying eyes. According to the survey conducted by Drake Software, only 39% of tax professionals use secure online portals to accept and store their client’s sensitive financial documents. 35% of tax professionals haven’t gotten to using a secure online portal and the other 22% don’t intend to use a secure online portal to properly handle their clients’ sensitive financial information.
The bottom line is that the benefit of having a tax professional to do your taxes for you is not the same across the board. Some tax professionals are more competent and experienced when it comes to dealing with the US tax code and some tax professionals conduct their services in a more secure manner protecting you from the prying eyes of no good-doers. If you are to choose a tax professional to do your taxes for you this tax filing season, make sure that you ask them the right questions for you to know if they can give you the peace of mind that your taxes are done the right way according to the latest IRS guidelines and if they can handle and store your sensitive financial information in a secure and safe manner.
Bottomline
Doing your taxes to save you some money from hiring a tax professional might seem like a good idea but hiring a tax professional gives you the benefit of knowing that your taxes are done the right way helping you steer clear of the IRS’ bad side which can lead to an audit and then lead to hefty fines and penalties. However, if you are going to choose a tax professional to do your taxes for you, make sure that they can give you the benefit of peace of mind that they are well versed in the latest updates in the tax regulations and that they can handle your sensitive financial information in a safe and secure manner.
The benefit of having a tax professional is not the same across the board. If you want an experienced tax professional to do your taxes for you with the utmost regard for your sensitive financial information then look no further. We are here to help you have the peace of mind that your unique tax situation is handled accordingly to the latest tax code changes and that your sensitive financial information is handled in a safe and secure manner that keeps it away from prying eyes.
