Tax season is officially in session, and with your formal statements in hand, it’s time to decide who will file your tax return. If you simply have a W-2 and earned interest from a bank savings account, you’re probably fine using an easy, online filing software. However, if your financial situation includes more than that, it might be better to hire a professional.
Here are five times it’s wise to have a tax professional file your return:
You have unusual sources of income. Royalties or bonuses from oil and gas leases, an inheritance, or income from a cancellation of debt, legal settlement or gambling all constitute unusual sources of income and special rules or requirements might apply.
You own rental properties. Income generated by rental properties must be reported on your tax return, but when it’s reported, record-keeping requirements and applicable deductions can vary based on your situation. Substantially more information for each property owned is now required compared to prior years, and a professional can help guide you through the necessary documentation.
You had significant changes in the past year. If you sold assets (including stock), had a baby, went through a divorce or had other life changes in 2019, there could be implications for your tax return. A professional can help you identify new benefits available and counsel you on the best way to file to maximize those benefits.
You’re a minister. Ministerial tax issues can be a little more complicated than most. There’s a seven-factor test to determine if a minister is an employee or self-employed, and the status affects not only filing tax returns but also Social Security. Housing allowances and accountable reimbursement plans add another layer of complexity to tax preparation for ministers.
You are self-employed or own a business. Taxation rules are different if you are self-employed or own a business, and the fallout from errors in filing could be more drastic. Not only could mistakes cost you money in the long run, but also not hiring a tax professional costs you time today, which might be even more valuable. A tax professional is a helpful partner for business owners or self-employed workers because they can bring new financial advantages to your attention, help you plan ahead to minimize tax liabilities and afford you peace of mind that the work was done correctly.
If you fit into the above categories, our tax advisors would be happy to meet with you at one of our seven local offices across Oklahoma.
Blog by Erica Shaloy, Tax Director.
Category: Tax and Accounting Team