Why You Should Use A Tax Consultant

Published: 08th February 2010
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Tax laws are tricky and change from time to time. When preparing to file your business or personal taxes it is advised that you hire a professional tax consultant to handle this business for you. Errors or mistakes in your bookkeeping can cost you serious penalties with the IRS. A tax consultant will stand with you if you are ever audited for any reason.

What does a tax consultant do?

The job of a tax professional is to keep track of all of your accounting records. A consultant will prepare the forms and calculate your earnings and what you will be claiming in your itemized list. He or she will prepare the paperwork for you and go over all the information with you prior to filing your tax return.

Why should you hire a tax consultant?

Many business owners choose to file their own taxes but unless you know the tax laws very well you could make errors that might get you investigated by the Internal Revenue Service. A tax professional knows the laws and what you are legally allowed to claim and will help you to avoid tax penalties if you do get into trouble.

Tax professionals are put through extensive training and testing to prove that they are familiar with state and federal taxes. This means that there is less worry of having any problems with your taxes. Another benefit to using a tax consultant is that if there are any problems with your return you do not have to face the IRS alone. You do not have this assurance if you do your taxes yourself.

Is it expensive to hire a tax consultant to do your taxes?

The cost varies depending on the type of consultant you choose to hire. A Certified Public Accountant will charge an hourly fee if they are not on your regular payroll. A tax consulting firm usually charges a flat rate according to the forms that need to be filed. The charge is per transaction. If you hire a CPA full time to do your bookkeeping and file your taxes the charge will be more than if you just hire them for the tax season.

Not everyone needs to hire a professional to take care of their taxes. If you do not have much income or expenses to claim you can probably handle this on your own. One simple form is easy to do yourself.

When you earn a substantial income or file itemized deductions it is a good idea to hire a professional to protect your assets. This is also advised if you earn money from self-employment, rental income or profits from a home sale. Serious penalties can come from keeping inaccurate records, not claiming the right amount of income or claiming deductions that you are not legally entitled to.

Where can you find a qualified tax consultant?

Finding a knowledgeable tax professional is not that difficult. The best way is by word of mouth. Ask friends and associates who they would recommend. The internet is also a good source of information for finding a tax consultant. Make sure to do your homework and check their references.Sarah James is currently writing content and blog content for Personal Economy a tax consultancy company. Sarah has increased her knowledge of all forms of finance especially the corporate services side.

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