Should I just DO IT MYSELF

Question of the week: Do your own taxes or use a professional?

Short politically correct answer: Sure, why not do it yourself if you can. But I wouldn't (read more)....

I often watch YouTube videos of new hair styles that I want to try. I watch the same video clip at least 50 times in hopes of imitating the technique used. The girl in the video always make things look so easy; 1.2.3 and done! When I go and try it myself, for some reason odd reason it never turns out the way i saw it in the video. It may be just my luck. I believe the same concept applies to taxes. You may have watch a preparer complete your return several times; it looks simple. It's only data entry. Right?

Well, to help you evaluate if and when you need to use a tax professional, I'm going to highlight the Pros and the Cons of doing it yourself. I want to stress the list below is not comprehensive. If you have a complicated tax return or is remotely interested in MAXIMIZING YOUR REFUND, then

USE A PROFESSIONAL (PERIOD) .

Consequences of not hiring a tax professional:

1. Miss out on credits/deductions: many people do not claim certain credits they are eligible for because they fear the IRS will audit their return. That is why tax offices can almost guarantee you a refund if you allow them to review your past tax returns that you've completed.

2. Miss out on the benefits of itemizing: many people don't itemize because they don't know what is appropriate to claim. When they do itemize, they are not certain on what to enter to get the full benefit of the credits or how to re-define expenses to their advantages. For example, mortgage related expenses, lost from a theft can be claimed, car registration, gambling lossess, medical expense charitable contribution, tithes, all can be itemize. And there's many more.

3. Extra eyes prevent mistakes:  

4. Tax Preparer is responsible for what is entered in your return, so they are your advocate if the IRS perform an audit.

5. Waste time looking over tax documents that are confusing. The IRS estimated the average taxpayer who file their own tax return spends about 23 hours trying to figure it out. Seriously this year is not the year to get it wrong. There has been many changes due to laws that took effect under President Obama. Unfortunately, it will cost you more if you make a mistake this year.  

Pros of filing yourself:

1. Save $100-200 in preparation fees. (note tax preparation fees are deductible in your return)

2. Keep your personal information private

3. Your life situation is simple. Example: 1 job, no kids, no house, no investments, no major events occurred.

4. understand tax laws and changes in the tax codes

5. Convenience of doing it from home.