Today is April 15, which means it’s Tax Day in the United States. Thanks to my accountant, my taxes have been done for a few weeks. Ironic, isn’t it, that if you owe money, they’ll cash your check immediately, but if you’re owed a refund, you’ll have to wait?
I keep a spreadsheet with a detailed account of my income and expenses (many of which are also email receipts tagged in Gmail under “business expenses 2008″), but my tax guy does the dirty work of figuring out how I owe. I’m curious – how many of you freelancers also use an a tax advisor? Or do you prefer the DIY method? Let us know in the comments!
Oh lord, I would never trust myself to do my own taxes. I’ve been consistently lucky in that, pre-marriage, my best friend’s tax accountant dad did mine for free. Now, post-marriage, my mother-in-law works for an accountant, and now he does our taxes for free!
Absolutely–as a sole proprietor of a business, I always use an accountant. The fee can be deducted from next year’s taxes and it is worth it to know someone who really knows taxes is making sure I am paying the right amount. Remember, freelancing is a business!
If I did it myself, I’d be in jail (not from purposeful deviousness but because math and complicated tax forms are not my friends)
I’m paid to do what I do well. I pay an accountant to do what he does well. I do the bookkeeping as best I can. My time is worth something and I’d rather hire that out than do it myself. Seems silly not to.
I agree with all of you! It’s a business expense and it makes a lot of sense to outsource tasks that fall outside your area of expertise, especially when there’s the potential for fines or an audit.
This year, I did it myself. I started in Turbo Tax, saw a HUGE amount I owed, and decided that dammit, I was going to get that bill down. I did – by $3K and by reading the IRS publications until I was nearly blind with boredom. My husband checked it all – looks good. I’m sure the IRS will disagree, but that’s okay. If I had to pay nearly $10K because Turbo Tax screwed up, I’d be furious!
That they screwed up calculations on my estimated taxes for last year is why I owe so much anyway. Bastards!
NO!!!!
Every time I’ve hired an accountant, who was supposedly a specialist in my area, it’s taken years to unmuddle things with the IRS.
I do my own taxes. It’s more accurate.
I took the time to learn the skills so I could, and it’s been worth it. The taxes are accurate and I save the fee.
It’s not brain surgery, for crying out loud. It’s filling out a form.
I’ve done my own taxes with Turbo Tax for almost 20 years, I guess. I was a Realtor for 12 years and have been a freelancer for 3-4 years now, so I have lots of practice filling out taxes as a sole proprietor. I like Turbo Tax because the program asks you all the same questions that an accountant would.
Did them through Turbo Tax last year and this, but after seeing how much they said I owed this year, I took advantage of H & R Block's $30 re-check service. Instead of owing $2500, they were able to get it down to $1150! Never again will I do it on my own.
“The fee can be deducted from next year’s taxes” – not in the UK, it can’t. My accountant told me her fee has to go on the year I’m paying her to do my tax for.
Which is the kind of thing I pay her to know about. In the UK we don’t have to do ours until 31 January of the following year but I like to do mine as early as possible so I know what I owe. Then pay it as late as possible…
My accountant understands things I totally don’t and saves me money by helping me claim for things I don’t understand, like depreciation of capital expenses. (Err… something to do with my laptop. Don’t explain. Really. I don’t care.) I’m amazed by the person who says “It’s not brain surgery, for crying out loud. It’s filling out a form.” I have a genius IQ and when I read the list of “most common mistakes people make on tax returns” I didn’t understand about 90% of what I read.
Also, I like knowing that if I get audited, my accountant will deal with the revenue so I don’t have to.
I pay £270 a year which covers doing my tax return and answering any questions I have. That breaks down to a monthly fee that’s less than what my boyfriend and I spent on Chinese takeaway today. And I feel it’s worth every penny.
I do them myself. When my X and I were separating I hired someone because of the amounts of money changing hands. It took me two years to get that straightened out. Mostly because my X could not comprehend the concept of telling the truth.
I love crunching numbers, so doing taxes is fun. Because of the medical expenses I do a month by month spread sheet and just move the numbers into turbo tax. I usually get them done in February, January gets sucked up by Arisia. This year the first three months of the year got sucked up by hospitalizations, so I only started last weekend. Took about four hours to input the data.
As long as I spend a few hours a month to crunch the numbers. I know it’s a bit late now, but remember to keep track of all medical expenses in 2009. It is so worth it.