There are close to 670,000 CPAs in the United States. These accountants help businesses and families with all kinds of tax matters.
You might be among the millions of people who prefer to do your own taxes. There are times when the services of an accountant are helpful, even necessary.
A small error or missed deadline could result in fines, penalties, or an audit. You want to avoid these situations as much as possible.
When is it time to hire an accountant? Find out when you need to hire an accountant in this useful guide.
1. Starting a Business
You might have done your own taxes for years while you were working for another company. It’s pretty simple because you had your federal income taxes withheld for you.
Filing taxes as a small business owner is another ballgame. There are different forms, plus you have to report your income and deduct your business expenses.
When you start the business, you set up a legal entity that. It affects how you report and pay taxes. Hiring an accountant can help you choose the best structure for your business.
2. Major Life Changes
Life changes have a direct impact on your taxes. Getting married means you can file jointly or separately. Buying a home opens the door to tax credits and deductions.
Getting a divorce, having a child, or changing jobs all have an impact on your taxes. Talking to an accountant gives you the financial help you need to stay ahead of your taxes.
3. Suspecting Business Fraud
Businesses are targets of theft, fraud, and other crimes. All too often, employees commit these crimes, not outsiders.
The best accounting firms have forensic accounting experience. They use financial investigation skills to uncover fraud and other financial crimes. Their findings usually get used in legal matters.
4. Getting Audited
Only a small percentage of taxpayers get audited each year. It’s a stressful thing to go through because the IRS does a complete and thorough review of your financials.
The tax authority wants to make sure you’re reporting all of your income and taking the proper deductions. Any questions or discrepancies could result in a financial penalty.
Getting accountant advice during this process is vital to get through the audit.
5. You Don’t Understand Tax Laws
The tax code is big and complicated. Most people don’t understand tax basics. If you find taxes confusing or difficult, hire an accountant to handle them.
It’s much better than making a costly mistake on your taxes and cleaning it up later.
When Should You Hire an Accountant?
You might not think that you need to hire an accountant, but there are situations when accountant help can save you from headaches down the road.
This article showed you a few situations where hiring an accountant is a smart move. Anytime you have a life change or get audited, an accountant makes life less stressful.
Did you find this article helpful? Be sure to visit the blog for more valuable insights today.