Hope for your financial life and beyond

Ranking the Tax Prep Options

April 3, 2013 by 10 Comments

This following is a guest post by Kim, otherwise known as Mrs. Luke1428. She is a CPA at an accounting firm in Georgia.

Liberty TaxStill haven’t done your taxes? No worries, I haven’t either! Maybe the better question is do you even know HOW you are going to get your taxes done?

As I see it, there are five different methods of preparing your taxes. (Well…six, if you include just blowing it off and not doing it at all. Guess you can imagine I do NOT recommend that!) Here is my assessment of them:

1. Do It All Yourself

a. Paper and pencil: OK, this is still possible. You can just go to irs.gov and download the forms right there and go to it. Geek factor and bragging rights are high, but accuracy level is generally low. It is free, but the pain in the tail factor is off the charts.

Grade: C-

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When Should I Consult a Tax Professional?

March 25, 2013 by 10 Comments

The following is a guest post by Kim, otherwise known as Mrs. Luke1428. She is an accountant at a CPA firm in Georgia and will earn her CPA license in the summer of 2013. The following is not tax or legal advice. If you have questions about your own situation, please consult a professional to discuss your particular situation.

Tax code bookWhen is it important to consult a tax professional? Well, as a tax professional, you may be surprised at my answer. At my firm, this is what we tell people who inquire about our services:

If you understand the questions and can answer them properly, then Turbo Tax works great.

It really does. It would make no sense for someone with a couple of W2s and some mortgage interest to pay a CPA to prepare their taxes. But, there are times when you need to consult a professional. Like when…

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Considerations When Starting a Business

March 18, 2013 by 4 Comments

BusinessThinking of starting a new business? Congratulations and thank you from the rest of America! Small businesses are what keep our country running. I thought I’d post a few things to think about if you are starting a new business. Of course, this isn’t an exhaustive list, and I’d encourage you to take the time to speak with a lawyer and a CPA to make sure that all your ducks are in a row. The expertise is worth the cost.

Having said that, here are a few things to think about:

What type of business will it be?

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How Does a 1040 Work?

March 5, 2013 by 4 Comments

1040 Tax FormFor years when our W-2s came in the mail, I just plunked our numbers into Turbo Tax, and out popped a form. We sent that form in (or just e-filed) and then boom…a refund check showed up shortly thereafter. Cool. But I really didn’t have an understanding at all about how the form flowed…I just answered the questions.

Now that I prepare tax returns for a living, I’ve come to appreciate how important it is that a taxpayer really understands what they are reporting on the form and how it all flows together. So, without further ado – here it is – the Form 1040 broken down into manageable chunks. I’ll try to keep it in plain English as much as possible. [Read more...]

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