When it comes to time-intensive tasks, it can be exhausting to even think about attempting to complete them, and time is money. So instead of trying to spread yourself thin this tax season, let’s evaluate if torturing yourself with tax returns is better left to a professional instead.
Here are 3 questions to ask yourself to determine if hiring someone to file your taxes is the right choice for you.
1. Are you more dominated by the left or right side of the brain?
Are you a logical thinker and are more engaged with subjects like math and science? Or are you more influenced to participate in artistic creative endeavors? Filing taxes is a chore of adulthood that some minds might find challenging in an empowering way, where others might find it challenging in an overwhelming way.
Taxes are almost like a home improvement project. Some prefer to outsource help, while others might find that the work provides a creative outlet. I don’t think labeling a DIY tax return project as a “hobby” is the same as a DIY home project, but you get the idea. Some people find it easier to work through numbers than others.
2. Are you a procrastinator?
Often, procrastination comes from a lack of confidence in your abilities. If you knew that you could hit something out of the park, wouldn’t you want to get right to it? Being unsure of the end result usually delays the process until it is detrimental that you complete it.
Filing Taxes Can Be a Daunting Task
Filling for taxes is a very ambiguous task that you hear about often, yet no one teaches you how to do it. It’s no wonder why so many people are uneasy about such a task. Taxes are a very serious matter and very rarely are you taught how to take care of them, let alone do them properly.
Even if you attempt to file your taxes, it is very easy to make a mistake. Making a mistake could be as severe as committing fraud or could cause you to lose money that you would have potentially gotten back. With risks like those, it’s easy to see why you would want to put it off until the last minute. Sadly, putting things off only diminishes the results in most cases. If you know yourself to be a habitual procrastinator, a task as tedious as taxes probably won’t turn that around.
What Is My Time Worth?
Everyone wants their financial trail to be spotless and free of any mistakes that may cause you grievances in the future. That’s no secret. But who can afford that? It has been estimated that the average person spends about 24 hours completing their tax returns.
For those who had to file extras such as Schedule C for business or a Schedule E for rental properties, these numbers swiftly jumped to over 52 hours. If you are still filing for your young-adult children that are working while they are in high school or college, that time only increases.
A tax specialist, who lives off of being able to do this task efficiently and without errors, will not cost nearly as much in comparison. Also, there is a good chance that the cost of hiring someone to file for you will be tax deductible if put on a Form 1040. This is assuming that you itemize the sum of your miscellaneous deductions you claim are greater than 2% of your adjusted gross income.
The Sooner You Start Your Taxes, The Better
Regardless if you are deciding to hire some help or not, there is still one more crucial detail to consider. It is hard to hire a professional the closer it gets to taxes being due. So even if you are confident with your decision to file for yourself, start early just in case you change your mind.
For reference, most people start preparing for the next tax season by initially talking with professionals in the fall. This means once you miss your opportunity to hire a specialist, you are in quite a bind.
Take the time to break down your time-benefit analysis, consider how your mind works, your available time and money, and your work habits. Hiring a professional who ensures convenience and peace of mind could be the right move to make financially.