Scenarios That Necessitate Having a Tax Accountant
Tax season is one of the most stressful times for many Americans. With the looming deadline and the complexity of filing taxes, it is no wonder that many people are already scrambling to get their tax returns in proper order.
Tax preparation is a complicated and ever-changing process. With the yearly update of tax laws and regulations, it can take time to keep up with the latest information. Even if you are confident in your ability to complete a tax return, there may be times when it is in your best interest to hire a tax accountant. This article will discuss some scenarios when hiring a tax expert is prudent.
You Have a Small Business or a Side Hustle
Owning your own business can be incredibly rewarding, but it also comes with many responsibilities, including paying for your taxes! Fortunately, several tax write-offs are available to entrepreneurs, and a professional tax expert can help you make the most of them.
Tax write-offs are deductions you can take from your taxable income. They are designed to ease the burden of taxes and encourage businesses to invest in their operations. While some tax write-offs apply to all companies, others are specific to certain industries and activities. A seasoned tax accountant can help you identify the write-offs you qualify for and ensure you are taking advantage of all the available deductions.
A tax expert can help you take advantage of any available tax credits. Tax credits are a more direct form of tax relief, as they reduce the amount of tax you owe dollar for dollar. Several additional credits are available to business owners, such as the Research and Development Tax Credit, the Renewable Energy Tax Credit, and the Work Opportunity Tax Credit. An accountant can advise you on which credits you qualify for and how to maximize their value.
The IRS Has Contacted You
If the IRS reaches out asking for something as simple as substantiation of expenses related to a car you bought, it is prudent and intelligent to seek help from a tax expert. The IRS may request certain documents to prove the expenses related to the car you bought, such as a sales receipt, a title transfer document, or a bill of sale. While these documents may appear simple, they may have other information that could be used to calculate the value of the car and the amount of taxes you owe.
Tax experts are especially helpful in navigating the complexities of the tax code, and they can provide insight into the best strategies for responding to the IRS. Additionally, they can assist with preparing and filing the appropriate documents and guide the most effective way to present your case. Furthermore, accountants can review your financial situation and offer advice on how to minimize your tax liability.
If You Have Rental Property
Real estate can be an excellent investment, but it can also get tricky when figuring out the return on investment (ROI). While it is possible to do the math and figure out what kind of deductions you may be entitled to, it is often best to hire a professional to help you maximize your return.
There are many considerations when calculating a real estate ROI, such as the purchase price, taxes, insurance, interest, and potential maintenance and repair costs. A tax accountant can help you assess all of these elements and determine what deductions you may be eligible for. For instance, you can deduct certain home improvement costs, such as a new roof or siding, from your taxes.
Conclusion
Hiring a tax accountant is highly beneficial as it ensures you take advantage of all the deductions and credits you qualify for and comply with the latest tax regulations. It is also essential to hire one to ensure that you are maximizing your after-tax income and that you are not underpaying taxes. Hiring one is necessary to provide you make the most of your taxes.
The clock is ticking, so you must save time and hire a seasoned tax accountant to review your books. There is no better team to help you than Ash CPA. We have the expertise and experience to produce an accurate tax return. Schedule an appointment now!