Can you trust the accuracy of your hired tax professional? Maybe not, according to new studies...So what's a tax payer to do?
Taxes are complicated. They take a lot of time and mental energy as well. That’s why April 15th has always struck fear into the hearts of many Americans. But even though filing your own return can be a mind numbing exercise, a new study shows that filing your own taxes could lead to a more accurate return.
We normally assume that hiring a professional to execute our tax return will lead to better results. It turns out that our assumptions were wrong. A new study from the Government Accountability Office released this week shows that, according to a random sample, 60% of returns prepared by professional tax preparers contain errors that could lead to discrepancies of thousands of dollars on your return.
The errors found in the returns completed by professionals were incredibly similar to the errors found in self-prepared returns. But those returns actually have a lower estimated percentage of errors - roughly 50%.
So what’s the takeaway? File your own tax return! Especially if the complications are minimal. Since you are actually more likely to file an accurate return, and do it for a much lower price, self-preparation is the best solution. IRS free file is the best place to turn if your AGI is less than $58,000.