Should I get a CPA?

[corn18]

Now that I am debt free and investing instead of of charging, I find myself with many new tax situations. IRA's, backdoor Roths, investment income, college, and I'm sure there's something that I am missing. I think I am ok for 2014, but to be honest, I am ready for some help to guide me through 2015 and beyond. What exactly do I need? A CPA? How much does a CPA cost? Not really interested in an investment advisor at this point. I am comfortable managing that myself. Just want to find out how to minimize / reduce my tax burden.

Thanks for the input,

Tom

[disneysteve]

We've used a CPA for years, though that is at least in part due to the fact that my father was an accountant. He did my taxes while he was alive. After he died, my cousin, who took over the family firm from him and my uncle, has been doing them.

Why do I use an accountant? I'm sure I could figure it all out myself but I prefer trusting the professional. If he finds one good deduction or credit that I would have missed, he can cover the cost of his services. I have multiple sources of income, including both employee and self-employment income, various deductions, investment income, etc. It gets rather complex. I'm very happy to have a pro by my side walking us through everything.

[BadSaver]

Worked as a CPA in public practice (not currently).

Small CPA firm shouldn't charge you an arm and a leg to do your taxes. Along with that usually comes advice if asked. Never billed clients for advice.

[corn18]

Visiting my first prospective CPA tomorrow morning.

[TimothyGandy]

That will be more essential when it comes to working on the big company.

[corn18]

Met with a CPA this morning and was comfortable with her attention to detail and knowledge. But what sealed the deal was talking to her husband who is an investment manager. He sat and talked with me for 2 hours about how to start a home business, find a vacation/rental home and "other" venture capital opportunities if I ever want to go that route. Very informative and price seemed very reasonable. So I hired them.

[Scanner]

I used HR Block's small business service for years until their fees kept creeping up and up and up. Last time I went in, it was $750 to prepare my return and I didn't even have payroll (I shared employees off of another doctor). He was one step away from an enrolled agent for the IRS but. . .I just thought it was too pricey. Esp. since he pretty much did "data entry" for 90% of the transaction. They keep calling me to come back.

I now go to a local CPA for $500/year.

But I file a Schedule C and you don't, it sounds like it. . .so I don't think it will be as much (or should be). I also file I think it's a Schedule D that depreciates capital investments over time that I also file.

Even with investments, you return shouldn't' be that complex.

[corn18]

I'm fairly comfortable with filing a tax return. Not that complicated for me. But in my 2 hour visit, they offered several options to me that would help reduce taxes and different ways to invest that would reduce taxes. I have a side business where I buy garden tractors at a great price, fix them up and sell them for a profit. I don't make a lot of money but I do spend a lot of money. They offered that I could take one of my empty rooms and turn it into a home office for my tractor business. Then deduct mileage, tools, garage space, etc... from my taxes. That sounded like a smart idea as long as I do it correctly. That's why I hired them. To help me do it correctly. They also offered that maybe I should consider buying a lavation/rental property. Instead of dumping $2,000/mo into a taxable investment account, why not make payments on a rental property that could generate income? I liked that idea as well.

We'll see how it progresses, but I liked what I heard and the cost is minimal if I can generate tax savings and/or income from with their assistance.

Tom

[HappySaver]

Be careful with the home office deduction. It's one of the biggest red flags for an IRS audit. Even if you can legally claim the deduction, is it worth it if it results in an audit?

The new IRS rules make home office deductions easier. My husband works from home and I calculated he could deduct his workspace (about 50 square feet x $5 per sq. ft) for a $250 deduction, which comes out to, what, $70 back? Not worth going there for us.

[krantcents]

I used a CPA for over 40 years. I owned homes, income property and a business. Now I only own my home which is about to be paid off. I can no longer itemize my deductions so I am trying out Turbo Tax. It used to cost me roughly $1-300 over the years. It helps that I have been with him so long and i put it all together for him too.