Free Tax Prep vs Paying a Professional
As Benjamin Franklin once said, “In this world nothing can be said to be certain, except death and taxes.” On this episode of Martinis and Your Money, I’m talking to Eric Nisall, an accountant, entrepreneur, and founder of the company AccountLancer, about taxes. If you are like me, you would pay anything to not have to do them yourself. However, that might not be the best idea from a budget and tax-planning perspective. Eric is going to answer some common tax questions and help you prepare for the certainty of tax time. Cheers!
As a side note: the first Financial Gym location has opened in New York City at 226 5th Avenue, 5th Floor. Please stop by and have a drink with us if you are in the area or check out The Financial Gym online for its tools and resources to help you break free from your financial challenges and live a financially healthier life! We’ll kick your assets into shape!
What are we drinking?
Eric — Jack & Coke
Shannon — Vodka & fresh grapefruit juice
- After two decades or so in the public accounting sector, Eric chose to start his own business and focus on the accounting areas he preferred.
- Eric says hiring an accountant is based on need and affordability.
- There are times when it doesn’t make sense to outsource something like that:
- If you aren’t making enough money
- If you don’t have the volume of transactions that makes it worth spending the money
- If you have very, very low overhead costs
- The same goes for hiring a professional to do your taxes.
- If you just have a W-2 and maybe some interests and dividends, you are perfectly fine using TurboTax or whatever else.
- Eric explains some possible errors that can occur when doing your taxes on your own.
- EVERYTHING you do impacts your taxes!
- Some examples of things that impact your taxes are:
- Moving from one state to another
- Having a baby
- Earning over a certain amount of money
- Estimating taxes is a tricky situation for freelancers and the self-employed.
- Eric suggests estimating year to date at the end of each quarter to give yourself flexibility to adjust if you are doing better or worse than before.
- Accessibility is something to look for if you choose to hire an accountant.
- You should not have the fear of change when it comes to switching accountants; you want to make sure you are getting your money’s worth!
- Some red flags to be aware of if you plan to hire an accountant or pay for a service to help you prepare your taxes:
- Overpayment for services rendered
- Hired person doesn’t sign their name as a paid preparer
- You don’t know who is doing the actual work for you
- Pricing structure of the company you choose to hire
- Take the time to research who you may hire and the services you will be paying for.
- TAKEAWAY: You don’t always have to pay for a service when you can do it yourself. If you do pay for a service, make sure you are getting your money’s worth – especially where your taxes are concerned.
Random Three Questions
- What is a show that you love to binge-watch?
- New Year’s resolutions: yay or nay?
- If you could go anywhere on any kind of vacation, where would you go and why?
Connect with Eric: