When is an accountant necessary?
One of the most obvious times you need an accountant is if you run a business. Aside from dealing with complex filing rules, you should hire a tax professional when declaring deductions and corporate expenses because you can easily trigger an audit with even the smallest mistake.
By going to a tax professional, you can get advice tailored specifically to your situation. This is a crucial benefit because the IRS has different criteria for various industries, so advice for a construction firm will not be applicable to a hospitality company, for example. While you might be able to do your own tax returns if you are self-employed, any time you have employees or payroll, an outside payroll specialist or tax professional is required because making even the smallest mistake on employee payroll can result in criminal penalties.
Tax professionals aren't just for business owners, however. Individuals like you might require professional assistance. Do you have assets outside the United States, dual-citizenship or even residency in multiple states? All of these situations are complex tax situations where a DIY approach to your taxes may be difficult.
While we can't list every possible scenario that might require a tax professional, in general, you'll want to hire a tax professional to handle your tax returns when you own a business and/or if you are doing more with your money than the average person.
Most people know accountants for providing assistance with filing tax returns, but they provide many other vital services that you can use throughout the year.
Two of the most common are bookkeeping and payroll services. By having an accountant handle your bookkeeping, you can focus on your business while he or she crunches the numbers. Payroll services are a vital part of any business with employees because as mentioned earlier, even the slightest mistake on an employee paycheck can result in significant penalties.
Accountants also play a vital role in helping to increase and preserve your wealth. They can provide valuations and due diligence assistance on investments or give advice to minimize your risk exposure. Typically, any time you want to make sure the numbers are right on a business deal, you will want to want to have specialized assistance with the matter.
For personal matters, an accountant can be vital for helping with wealth management and protecting your money from high taxes. An accountant will also work with your financial planner to help ensure that when it comes to retirement or college savings, you are well prepared.