The IRS is expected to start accepting income tax returns later in January. Many U.S. citizens are eager to receive their W-2 forms. While some people prefer a tax professional to file their taxes, it can be easy to file taxes yourself. Depending on your personal circumstances, a tax accountant or tax filing software might be the best option for filing your taxes.
Companies like Intuit and H&R Block offer self-filing software. Intuit has its Turbo Tax software, while H&R Block is the other top software brand. Many people think that these software programs are the best two choices for filing taxes yourself, but there are other online options as well that can be just as convenient if not cheaper.
Plan ahead when choosing a tax accountant or tax software.
Whether you’re going to use an accountant or self-filing software, it's best to not wait until the last minute to file your taxes. The deadline to file taxes for 2021 is April 18, 2022. April is usually the month that's designated as a deadline to file. Last year, the IRS pushed the deadline for 2021 filing to May 17, largely due to the ongoing pandemic. The IRS hasn't announced if it will extend this year’s deadline, so don’t depend on an extension.
Waiting to file taxes near the end of the filing period can result in your tax return being delayed. Delays could be hectic again this year, since the IRS is still heavily delayed in Child Tax Credit payments from 2021.
Some U.S. citizens still haven’t received their Child Tax payments. The agency has been experiencing heavy payment delays. The IRS has been having to distribute and process various types of government payments related the COVID-19 pandemic throughout 2021 like stimulus payments, tax credits, and more. If you file your tax returns as early as possible, you have a better chance of receiving the refund early.
Also make sure that you have and file the proper tax forms on your return. If you’re a small business owner, and have a sole proprietorship or a single-member LLC, you’ll likely need to file a Schedule C Form (Form 1040).
Those who sold items online on platforms like eBay and Amazon might have to file the Form 1099-K, depending on the number of transactions and the amount of revenue the sales accrued throughout last year. There are various other forms that others might or should file on their return. If you leave certain forms out, it can result in penalties or missing out on compensation in your tax return.
Should I choose a tax accountant or tax software?
The decision will depend on your personal circumstances and preference. If you have many forms to file on your return, prefer human and face-to-face interaction, and want someone who can handle various complications, a tax accountant might be the best option. Accountants or CPAs are usually experienced professionals in tax services. Using tax software can be confusing for some people, which could lead to technical errors throughout the filing process.
If an issue arises when you're using tax software, the software services might be using a tax preparer that doesn't have the experience or credentials of a CPA or accountant.
H&R Block offers a tax course that allows anyone to become a certified H&R Block tax preparer, which means that no previous tax or accounting experience is needed to become certified. So, if an issue arises while using H&R Block’s tax software, you could be paired with a tax preparer who doesn’t have the proper accounting experience.
For those who don’t have a business, or have few forms to file on their taxes, tax software might be the best option. The software is fairly simple to use and can save a lot of time and money instead of using an accountant. While TurboTax and H&R Block offer tax software for filing, the IRS also offers an online tax filing service for you to file your federal income taxes. For state taxes, many states offer their own online state income tax services as well.