Is Doing Your Own Taxes a Good Idea?
In these tough economic times, it’s tempting to do your own taxes to try to save some money. Why hire a professional when do-It-yourself software is readily available? Some software providers even advertise filing your taxes for “FREE”.
If you have you ever used a program like TurboTax™ it is extremely detailed, gets very complicated and is very time consuming; especially if you require more than a basic return claiming a standard deduction. In addition to the complexity of learning the software, the more complicated your return becomes, the faster the user finds out just how “FREE” the DIY software really is. The following infographic helps answer the question: Should I do my own taxes or hire a Tax Pro?
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THE TRUE COST OF DOING YOUR OWN TAXES
Many believe that doing their own taxes will save them money. If you have a very simple return with no deductions, then sure, filing is easy. But when you have kids, a house, business deductions, itemized deductions, stocks, bonds & other complicated financial transactions, doing a return yourself is almost never a good idea.
- 60% of individual taxpayers in the US hire a tax professional to do their taxes
- 29% of individual taxpayers use tax software
- 5.6 million words in the tax code
DOING YOUR OWN TAXES IS COMPLICATED
The income tax code and its associated regulations contain almost 5.6 million words. That’s seven times as many words as the Bible.
- There are 1.4 million words in the tax code
DOING YOUR OWN TAXES TAKES UP TOO MUCH TIME
Tax payers spend 5.4 billion hours a year trying to comply with 2,500 pages of tax laws. That’s enough hours to make it the biggest industry in the US
AND THERE’S THE COST OF TAX SOFTWARE
The average cost a person pays for tax software is $75 to $125
PLUS, AUDITS ARE INCREASING…
Last year, the total number of individual taxpayer audits topped 1 million for the first time since 1999, according to the IRS, and that number will likely keep growing.
- The IRS has announced plans to add more than 2,000 positions to its audit operations this year.
- 1 in 107 returns are audited for those making under $100,000
- 1 in 63 returns are audited for those making over $100,000
CONCLUSION: MONEY IS NOT SAVED WHEN DOING YOUR OWN TAXES
- $1,492 average refund of self-filers
- $1,789 average refund of filers using a tax pro
- $2,615 average refund of filers using a tax pro in the month of April
THE TRUE COST OF DOING YOUR OWN TAXES: $347 to $841
According to the National Society of Accountants, tax preparers on average charge $246 nationwide.
Hiring a tax professional not only saves you countless hours – it can save you over $500!
HAVE PEACE OF MIND AND SAVE TIME THIS YEAR. HIRE A TAX PROFESSIONAL