People filing their taxes online often distract themselves from this important but tedious task with television, social media and even arguments with a loved one, according to a recent H&R Block survey of 2,000 online tax filers. The survey revealed the following activities as ways people occupy their time while also preparing their tax returns:
|Browse social media||28%|
|Yell at their kids||11%|
|Fight with significant other||10%|
Note the above percentages exceed 100% because some respondents engage in multiple activities (it's easy to see how drinking alcohol could lead to arguing with your significant other, for example).
Along with all of the distractions, DIY tax filers also deal with confusion about credits and deductions—40% of respondents think they left money on the table by doing their own taxes.
Should you prepare your taxes yourself?
If you prepare your own taxes online, you need to ask yourself whether you should hire a tax professional to help even though you can use similar software to do the job yourself. While tax software can easily be purchased for less than $100, the average fee is $273 to complete a 1040 Form with itemized deductions on Schedule A and a state tax return.
Your time may be a factor in determining if it’s worth it to hire a tax preparer. The IRS estimates you'll need 16 hours to complete a 1040 Form, but if you hire a professional to prepare your taxes, your time commitment will be greatly reduced because the only thing you’ll need to do is to gather your tax documents to give to your tax preparer.
When makes sense to hire a tax expert
If your tax situation is complex—maybe because you own a business or have extensive investments, for example—then it’s probably a good idea to hire a tax pro; otherwise, filing your own return with tax software should work fine. Also, be forewarned that when you file your own taxes, you will be the person the IRS will contact if they have questions, but if you hire a tax professional, she or he can be the point person.
If you decide to hire someone, make sure you select a tax professional who has the proper credentials. A tax preparer with an IRS Preparer Tax Identification Number (PTIN) is authorized to prepare federal tax returns. A complex tax situation may require more expertise, in which case you should seek out an enrolled agent, CPA or tax attorney.
If you plan on filing your own taxes online, use the best-rated tax software for 2019. For those individuals with a yearly income of $66,000 or less, the IRS’s Free File software program allows you to choose a brand name tax filing software and file your taxes for free (those earning more than $66,000 can still take advantage of the government’s tax forms and e-file for free, but they won’t enjoy the benefits of the calculations and error checks of the brand name tax filing software). Finally, remember to file your taxes by the deadline—if there’s anything less enjoyable than paying taxes, it’s having to pay fees for filing late.