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Everyone’s favorite time of the year is tax season. The IRS announced that he will begin accepting and processing 2022 tax returns on January 23. An estimated 168 million individual tax returns will be filed, the majority of which he expects to be filed by the April 18 deadline, according to the IRS.
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You have two options when it comes to paying your taxes: doing it yourself or hiring a tax accountant. DIY taxpayers are typically young entrepreneurs with small assets. While 53% of all taxpayers paid a tax professional in 2021, Gen Z members were far less likely to do so than other age groups, according to an IRS study, USA Today is telling. A middle-income earner earning $90,000 to $75,000 was most likely to hire a tax professional (59%).
A tax professional can be helpful in many situations, but in some cases it is fairly easy to pay the taxes yourself. However, it all comes down to your taste.
when to do your own taxes
If taxes are easy (you have a limited source of income and plan to take standard deductions), USA Today suggests that paying your own taxes may be your best bet. I’m here. Not only does this save you money, but you can use tax software (or fill out a free form on the IRS’s website) to expedite the process.
If your deduction exceeds this year’s standard ($12,950 for a single person, $19,400 for a head of household, and $25,900 for a couple filing jointly), itemize the deduction. It is recommended. But if you’re worried about the extra paperwork, accountants say you should consider hiring a professional.
When to Hire a Tax Professional
It’s a good idea to hire a tax professional after a major life change, such as getting married or divorced, having a baby, buying or selling a home or business, retirement, or health issues. USA Today said it may also be wise to pay a tax professional if you have multiple sources of income, investment losses, inheritances, or real estate settlements.
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Before hiring a professional, the IRS said you should find one who holds an IRS Producer Tax Identification Number (PTIN). Check the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications to find a certified professional in your area, or contact a professional organization with tax return preparers.
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This article originally appeared on GOBankingRates.com: Should You Pay Your Own Taxes? Should You Choose DIY or a Tax Accountant?
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