It’s my first year owning a home with rental income. I tossed the idea of doing my own filings but decided to go with a CPA. He’s charging about $200…sound feasible?
Do you file your own or have a professional keep track of the books? I like the idea of having a relationship with a CPA and being able to bounce ideas off of them.
Do you need a CPA for a single rental property? No, but I think you are leaning toward using one. No problem.
Is $200 a feasible fee for preparing a tax return? Yes. Reasonable? Definitely. Actually any fee you may be charged is feasible, although for a straightforward tax return with a single rental property, you may feel that a $1 million fee is unreasonable.
I use TurboTax Premier. Works well enough for me and only costs $80 at the TurboTax website – less at the wholesale club store.
Thanks Dave. I met with him today and must say it was worth the $200. I consider it a learning experience and can also write it off next year. I knew a lot of the basic info but was confused on how to handle the double ( I live in half ). I didnt know if it was able to depreciate or if my living in the house wiped out all investment advantages.
Bottom line, I learned a lot and now have someone to bounce all of my transactions off of to make sure im getting the best income possible. Also, I was able to spend the few saved hours getting a new suit tailored.
You can also bounce your questions off this forum, for free.
Though if you want to send me the $200 every time I answer a question for you, I won’t refuse it.
I can’t disagree with the wealth of knowledge on this forum. However, I prefer to use my time doing something I know well…my 7-6 job and my many other duties in life. If someone is going to specialize and charge $200 to prep my taxes, stay up on the current tax laws, keep track of my basis and yealy deductions, and back me up in case of an audit, it’s well worth the extra money that I can write off anyways. If I did them myself I would want to know the laws inside and out and that would take time that I can use somewhere else making money.
We can’t be professionals in everything but we can understand everything and know when to hire it out. Do you install your own roofs or would you rather have someone with the tools and experience do the job?
I’m not criticizing you for doing your taxes…that’s great you feel comfortable doing them. Some others won’t have a working knowledge of splitting a duplex and keeping track of two basis’ until the whole thing can be converted and depreciated. The publications the IRS gives are not complete for every scenario and this situation needed an expert’s help since one side is completely rented and my half has 2 roommates paying rent. How would you have set the house up this year?
I agree 100%
So will you be using the CPA next year?
I think it’s good for everyone to meet with a CPA at least once for the first time(when your financial situation changes), just to get things done right.
After that, most of us familiarize ourselves with the circumstances that affect our personal tax situations, and no longer need a CPA.
If you did pay someone to professionally prepare your taxes, you should devote some time to try to learn exactly what they did so you don’t need them in the future.
For example, I used to have to pay my CPA a lot of money to do cost segregation on my residential rentals. Now, I know how to do it myself and I don’t need a CPA, but if I hadn’t gone to one in the first place, I would have never learned how to take advantage of certain tax strategies.
Over time, you will come to find that CPA can be very uselful, and if your time is limited, you will be better of paying for a CPA.
$200 for a CPA is peanuts. You’ll spend more money at H&R for less expertise.
I will definitely be using the CPA next year…I don’t have the time to keep up to date with everything and file my federal, state, and two city forms. I work a lot, I keep my receipts, he takes care of the rest. I have other things to do.
I thought $200 was cheap…my first year out of college cost me $270 at Jackson Hewitt (I had income in 3 states).
As I tell my clients:
You have to choose how you will spend your time. Do you want to figure out all the rules, laws, forms, tracking, software, etc? Or do you want to spend your time running your busness to make money? What else can you do with that 4 (or 6 or 12) hours? Meet with contractors, put in a toilet, complete your make-ready, interview 3 tenants?
Your taxes are my business.
Letting me do my business lets you focus on running your business.
<<end of shameless plug for CPA’s everywhere>>
gsuidiot,
I know what an idiot is, and I don’t believe you are an idiot. I don’t know what a GSU is. Please enlighten me.
My money is on Georgia State University…
Keith
GSU is a school I went to in NY…
my roommates called me an idiot, so the name just stuck…