Should You Do Your Own Taxes?

by Stacy Francis, CFP®, CDFA

My college friend was red-faced and bursting with anger when we met for after-work cocktails the other day. She arrived straight out of a meeting with her tax accountant, who had failed yet again to get her the tax refund so many people received last spring, and for which she was eligible. “Next time,” she muttered between her teeth, “I am going to do the taxes myself. What am I paying him for anyway?”

I tried to explain to her that whether or not you get a tax refund should not reflect on the quality of your accountant. In the safety of my home, away from her rage, I realized that her real question is “Should you do your own taxes, or hire someone to do them for you?”

To answer that question, here are a few things indicating that you could be better off on your own:

  • You know your filing situation (you are up to date with legislation, know your status, etc) and have a very simple financial situation.

  • You are organized and have your paperwork ready to go.

  • You prefer not to disclose your financials to anyone.

On the other hand, these things may be signs you need help:

  • Your financial situation is complex.

  • You don’t want to waste time and energy preparing your return.

  • Your life has changed drastically, and your filing this year will be very different from last year.

  • You want the confidence of working with a trusted advisor.

Or, alternatively, if you are so furious at your accountant that you run the risk of expiring from a heart attack, you may also be better off on your own.

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