By Webster Tilton Yes, it’s that time again. Some people look upon tax season with hope, anticipating a refund. Others look upon it with dread, anticipating a hefty bill. And everyone, even those anticipating getting money back, consider it an annoying chore. But it’s got to get done, so, how...

By Webster Tilton

Yes, it’s that time again.

Some people look upon tax season with hope, anticipating a refund. Others look upon it with dread, anticipating a hefty bill. And everyone, even those anticipating getting money back, consider it an annoying chore. But it’s got to get done, so, how best to do it?

The simple answer is that it depends how complex your finances are. If you’re not invested, and don’t own much in the way of property, then doing it yourself is simple and cheap (possibly  even free). This is because you simply don’t have much in the way of deductions or liabilities to calculate. However, the better you’re doing financially, the more complex it gets. Do you have children? Own a home? Invest in stocks? Have a retirement fund? Win any money gambling? Pay business expenses out of pocket? The list goes on and on. There is a reason why H&R Block and Jackson Hewett continue to exist.

There’s only one real question you need to answer when deciding whether to file yourself or pay a professional is; what way gets me further ahead? Places like H&R Block report that the average fee for preparing taxes is between $150 and $250. So, if you have reason to think that your refund will go up by at  least $200 (or your liabilities go down by at least $200) then it’s a good idea to hire a pro. If not, then do it yourself. Some good reasons to hire a professional include: correcting mistakes on past returns, marriage or divorce within the last year, residing or being employed in more than one state, owning foreign assets, starting a small business, adopting or giving birth to a new child, inheriting money or other assets, the death of a spouse, and supporting your elderly parents or grandchildren.

Any of these issues can easily complicate your taxes to the point where hiring a professional is a wise idea despite the cost. Remember that the more complicated your financial situation  is the more expensive the tax preparation service will be. But an audit or a wrongly filed return could easily cost you more than the best professional help available.