Tax Question/Advice

**iam23skidoo** · 02-03-2011, 01:24 PM

Hello FV this is my first post! I've really enjoyed browsing the forums, but I have a question about taxes that I need help with.

I've always done taxes myself, and it has worked out in the past. However this year some changes (positive) with my employment and my wife's has caused us to move up in liability. Last year we received a pretty large refund since my wife was a part time student.

I adjusted some witholdings and this year I owe a substantial amount over my savings according to Turbo Tax (with deductions). I was unable to claim Student Loan interest and did not get a childcare deduction due to our income (among others). I prepared the taxes already, but can not pay what turbo tax says I owe.

Would it be beneficial to employ a tax professional or am I just paying more for a service I don't need?

I appreciate your opinions.

**MissSeetonFan** · 02-03-2011, 05:15 PM

Sometimes a tax professional can help where the programs or our own math cannot. They are trained to be familiar with the changes and know the usual things to look for in order to reduce your tax burden. I think the tax programs try to go for the same things but not as well.

That said, I would run the taxes again in a couple of different ways through the software to see if there are any other gains you could find. Try running it with filing separately, as head of household, etc instead of just filing jointly. If that doesn't help your numbers any, then maybe a professional is needed.

At the same time, if the professional comes to the same conclusion that TurboTax does, you then have to pay the professional as well as the taxes owed.

If you cannot pay all your taxes owed at once, you can contact the IRS to find out what they recommend. I have never had to deal with that.

Not much help, I know. Good luck!

**krbshappy71** · 02-03-2011, 06:26 PM

Our local library has people to help with taxes each year. You could bring it in to them for a look-over. (they are free and you are just looking for a new pair of eyes it sounds like) Check and see if your library offers this service.

**Nishu** · 02-03-2011, 08:41 PM

Tax Topics - Topic 306 Penalty for Underpayment of Estimated Tax

You can face penalties if you don't pay your income taxes throughout the year. If you owe more than 1k, I'd consider hiring a professional. Just my opinion. I'm not an expert or anything.

**Minner77** · 02-04-2011, 04:04 AM

As another mentioned, you can get excellent free tax preparation from libraries and other venues. My husband, who thinks doing taxes is fun, God bless him!, just finished a tax course with AARP and is now certified and volunteers for 4 hours every Wed through April at the mall. The course was rather rigorous. DH, BTW, has a Master's in Business and studies taxes and finances as a hobby. Not all preparers are formally educated outside of tax prep, but they are definitely schooled in the ins and outs of current allowabilities (some, of course, better than others: DH has done our taxes and others' for years, but this is his first year officially doing the mind-boggling variety of returns presented to him by the general public).

The AARP is the "sponsor," but one needn't be an AARP member, or 50, to use the program. Just FYI!

~M