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10 Worst Mistakes to Make on Your Taxes

        Money | Taxes

9
Paying (or Not Paying) for an Accountant
An accountant can be a big help in getting your taxes done correctly. But make sure you hire the right one. Creatas/Thinkstock
An accountant can be a big help in getting your taxes done correctly. But make sure you hire the right one. Creatas/Thinkstock

Most of us filed our first tax return when we were teenagers and the entire operation — copying a single number from a W-2 and entering it into the right box on the 1040EZ — took 23 minutes and a sharp No. 2 pencil. But there comes a time in every taxpayer's life we ask the anxiety-ridden question: "Am I making a huge mistake by doing my own taxes?"

As life grows more complicated, so do our finances. You get married, have a kid, buy a house, take on a side job, invest for retirement — all of these life events have tax implications, and overlooking them could be very costly.

You might decide it would be easier to hire some tax help. Here are some of the pros and cons [source: Phillips Erb]:

  • Pro: Increases your odds of getting a refund
  • Con: It costs more money — around $270 for a standard 1040; $420 for business schedules E or C
  • Pro: Decreases your chance of an IRS audit and penalties
  • Con: It puts your financial fate in the hands of a stranger
  • Pro: A tax pro can offer advice on how to lower your tax exposure for next year
  • Con: Not all tax advisers are created equal. Can you afford a good one?

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