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Tax Accountant - Should I DIY

Posted: Fri Feb 14, 2020 4:13 pm
by ddurrett896
Had a rental property and paid an accountant to do my taxes over the past 7 years. Mostly for the rental depreciation and such...I didn't want to think about it.

Rental sold in 2020 and this year so I shouldn't need them anymore. My plan is to let them finish 2020 then DIY.

What prompted this was 1) the rental sold and 2) they charge me $450 to prepare and 2) just tacked on a $150 charge for a general question I asked before selling the property and how it will affect taxes.

This situation reminds me of when I left my American Funds advisor and self managed thru Vanguard. It was overwhelming at first, but I can't imaging not doing it myself now.

My wife file joint, with two employer W2s and contribute to a 401k, Roth, HSA and Depdendent Care FSA. Seems pretty basic. What's do you recommend for tax prep, etc? Thank you!

Re: Tax Accountant - Should I DIY

Posted: Fri Feb 14, 2020 4:15 pm
by BogleMelon
With your pretty basic tax situation, I would say, go for it. You will never look back.

Re: Tax Accountant - Should I DIY

Posted: Fri Feb 14, 2020 4:17 pm
by bloom2708
The various tax software are very easy to use.

I've used TaxAct.com (online version) for a number of years. Desktop version before that.

If you just have some interest, stock/mutual fund sales it doesn't take that much effort to do it yourself.

We have college age kids (AOTC), but even complex topics are easy to research. With the standard deductions so high, it takes a lot of deductions to get to itemizing.

You could at least give it a try after the 2020 taxes are filed.

Re: Tax Accountant - Should I DIY

Posted: Sat Feb 15, 2020 4:56 pm
by ddurrett896
Is TaxAct the best platform to use?

Re: Tax Accountant - Should I DIY

Posted: Sat Feb 15, 2020 5:15 pm
by pshonore
ddurrett896 wrote:
Sat Feb 15, 2020 4:56 pm
Is TaxAct the best platform to use?
I think Turbo Tax is better. The Deluxe version is all you need, but even Basic may be enough. Get the download/cd version. Definitely let the accountant do the 2020 tax year return with the rental sale though.

Re: Tax Accountant - Should I DIY

Posted: Sun Feb 16, 2020 12:07 am
by Cubicle
I switched from an accountant to self preparing a couple of years ago. It seemed daunting. It seemed scary. It was not. And every year it gets easier.

Re: Tax Accountant - Should I DIY

Posted: Sun Feb 16, 2020 8:22 am
by BarDownHockey
pshonore wrote:
Sat Feb 15, 2020 5:15 pm
ddurrett896 wrote:
Sat Feb 15, 2020 4:56 pm
Is TaxAct the best platform to use?
I think Turbo Tax is better. The Deluxe version is all you need, but even Basic may be enough. Get the download/cd version. Definitely let the accountant do the 2020 tax year return with the rental sale though.
Out of curiosity, why do you recommend the download/CD version vs the online one?

Re: Tax Accountant - Should I DIY

Posted: Sun Feb 16, 2020 9:28 am
by pshonore
BarDownHockey wrote:
Sun Feb 16, 2020 8:22 am
pshonore wrote:
Sat Feb 15, 2020 5:15 pm
ddurrett896 wrote:
Sat Feb 15, 2020 4:56 pm
Is TaxAct the best platform to use?
I think Turbo Tax is better. The Deluxe version is all you need, but even Basic may be enough. Get the download/cd version. Definitely let the accountant do the 2020 tax year return with the rental sale though.
Out of curiosity, why do you recommend the download/CD version vs the online one?
I like to work in "Form Mode" when possible. (I've been using TurboTax for almost 25 year and admit to being an old curmudgeon). As I understand it, the online version does not let you see the actual forms or details until you pay (which makes sense for TT)

Re: Tax Accountant - Should I DIY

Posted: Sun Feb 16, 2020 10:00 am
by panhead
ddurrett896 wrote:
Fri Feb 14, 2020 4:13 pm
Had a rental property and paid an accountant to do my taxes over the past 7 years. Mostly for the rental depreciation and such...I didn't want to think about it.

Rental sold in 2020 and this year so I shouldn't need them anymore. My plan is to let them finish 2020 then DIY.

What prompted this was 1) the rental sold and 2) they charge me $450 to prepare and 2) just tacked on a $150 charge for a general question I asked before selling the property and how it will affect taxes.

This situation reminds me of when I left my American Funds advisor and self managed thru Vanguard. It was overwhelming at first, but I can't imaging not doing it myself now.

My wife file joint, with two employer W2s and contribute to a 401k, Roth, HSA and Depdendent Care FSA. Seems pretty basic. What's do you recommend for tax prep, etc? Thank you!
I also had a rental property which was owned by partnership (me and one friend) and had a CPA do the returns from the time we purchased it. A few years ago I was reviewing what he did and found several mistakes on both the partnership return and my personal return. I decided at that point I would learn to do both returns myself. I decided on TaxAct at the time and have been reasonably happy with it other than the price hikes. We sold the rental property in the partnership last year, and I recently just finished doing that return. It was a bit of work, but I got through it. Going forward, my taxes will be significantly simplified, as will yours.

I don't know if it matters much what software you use, most here like H&R block, TurboTax, and TaxAct. Some like freefillableforms but that's more manual. I would recommend the download however, this way you can toggle between forms and Q&A so you can see and understand how things get populated in the various forms, schedules, etc.

Re: Tax Accountant - Should I DIY

Posted: Sun Feb 16, 2020 5:16 pm
by Eagle33
Recommend you have account do tax return for year you sell RE. Also try tax software for that year so you can overlap and see if your return matches tax preparer version. You can ask preparer questions how he got #s if they do not match your version.

Re: Tax Accountant - Should I DIY

Posted: Sun Feb 16, 2020 6:36 pm
by its4inthemorning
Agree with others that moving to DIY before the returns for the year the rental was sold is not a good idea. You would have to input fixed asset and depreciation data that your accountant already has in his system, and although your accountant should provide enough of his worksheets to allow you to do this, he is almost definitely not going to walk you through them.

BTW, I don't think $450 for preparing the returns, or $150 for figuring out tax impact of sale beforehand, are unreasonable.

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Re: Tax Accountant - Should I DIY

Posted: Mon Feb 17, 2020 8:43 am
by ddurrett896
its4inthemorning wrote:
Sun Feb 16, 2020 6:36 pm
BTW, I don't think $450 for preparing the returns, or $150 for figuring out tax impact of sale beforehand, are unreasonable.
I think the $450 is acceptable.

The charge for asking a question is unacceptable as it relates to my return. Last year I asked "what documentation is needed for the home office deduction" so I can prepare the utility bills, etc. by month to simplify the process. No charge...