I do not do my own taxes. That will shock a lot of my readers and clients who know that I own a business that offers tax planning and tax preparation. Also, I am an IRS enrolled agent, licensed to prepare taxes and represent taxpayers in front of the IRS. I did my own taxes in high school, college, and early in my career, when my taxes were simple and the stakes were lower. But today, I own a few businesses and would rather have someone else, someone who spends all day doing this, wrestle with all the complexities.
I should also mention that the intent of this column is not to try to convince you to stop doing your own taxes. We work with retirees who typically have about $2-$10 million invested. I would guess about 30 percent do their own taxes, and for the vast majority of them, that’s totally fine. Here are the situations on the other end of the spectrum, primarily folks in the demographic we help, where I think professional help makes sense.
You are selling your primary residence
On the one hand, this can be a simple thing to report on Schedule D. On the other hand, the stakes are high. We have a number of clients every year selling homes well into seven-figure territory that they bought for a fraction of that. There are significant tax benefits to selling your primary residence vs. an investment property, but you must ensure you qualify, calculate your adjusted basis, account for any periods when the home was rented, etc. Things can get complicated quickly.
You are considering selling an investment property or a vacation property
Investment properties are typically tax-advantaged during the period you own them, but a big bill often comes due at sale. This calculation is much more complicated than the one for selling your primary residence. You must calculate adjusted basis and factor in depreciation recapture.
Vacation homes tend to be simpler, but there may be planning opportunities here if you’re willing to convert a vacation home into your primary residence for a period of time. The accountant’s job is to report the transaction. A financial planner may be able to help with the planning strategies. We rely on tax planning and financial planning software to walk through the different scenarios and the estimated tax due, or saved, in each one.
You are starting or you own a business
Sole proprietors report income on Schedule C. It’s a fairly straightforward form that you may be able to do on your own. However, a good CPA’s job extends beyond just reporting and compliance, to strategy. Should you actually be a sole proprietor? Would an S-Corp or C-Corp be more advantageous? If so, things will get much more complicated, but it may be worth it. Either way, it makes sense to have a pro weigh in.
Significant K-1 income
K-1s report your share of income, losses, deductions and credits, from a pass-through entity. That sounds like a different language to anyone who hasn’t lived this life. I have brought on many clients over the years who had straightforward tax situations but had to file extensions every year because their old advisor put them in a few private investments that issue K-1s. These can be simple to plug into a tax preparation software like TurboTax, but the larger the proportion of your income these are, the more beneficial it will be to hire someone to correctly report the income. This is especially true in years when one of these entities is sold or has a liquidity event.
You are planning a large gift
I’ll define large as anything over the annual gift exclusion ($19,000 in 2026) because that’s when you may have to report personal gifts on Form 709. However, the larger the gift, charitable or personal, the more important this is to get right. I see people give kids money all the time for educational or medical expenses, that would be better off going directly to the institution. Similarly, I see charitable gifts done in an extremely inefficient manner. To get this right often takes the coordination of a financial planner and a CPA.
You’ve received an inheritance
Inheriting capital assets (taxable investment accounts, real estate ) is great because they generally receive a step-up in basis. However, you are responsible for properly documenting date-of-death values and any subsequent gains. A CPA can help.
Receiving a retirement account has become much more complicated since the SECURE Act became law. You want to make sure you are taking RMDs when you are supposed to.
You have a taxable estate and/or there are irrevocable trusts
Taxable estates and irrevocable trusts often go together. I don’t think I’ve come across anyone with a taxable estate ($15 million per person in 2026) who is doing their own taxes, but this may be you. In this situation, the investment income is likely high enough to warrant a second set of eyes. There are often gift and estate considerations that would also be reflected on your 1040.
When you have a taxable estate, you often incorporate irrevocable trusts in your estate plan to help mitigate estate taxes and protect assets for the next generations. Irrevocable trusts will have their own trust tax return.
You are a dual citizen or have foreign assets/income
This could take all sorts of different forms. You could be living in the U.S. but have foreign investments and foreign income. You could be a U.S. citizen living abroad who has to file income taxes in multiple countries. You may have dual citizenship, live here, but still own a house back home. The IRS has specific rules, credits and forms that must be filed in all of these situations. You’ll want to engage someone who specializes in cross-border tax planning.
You earn income in multiple states
In the U.S., you must report income in the state in which it was earned. Our clients who retired from big law firms saw the complexity of their returns implode the year after retirement. The same is true of the partners at Big Four accounting firms.
This is not the only situation where this is the case. We often see multiple state returns for clients with rental properties in different states. Sometimes this is simple. Other times, it makes sense to get help.
You are divorced or getting divorced and have joint assets
I recently had a retired accountant reach out to figure out how to report joint income from a private investment with her ex-spouse. I had to refer to our internal tax team. Divorce creates a lot of complexity. Tax can be one of those things. If you’re trying to figure out how to report mortgage interest, who gets the various deductions/credits, etc., you’re going to want professional help. Sorry for yet another bill!
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In 2019, I decided to do my own return on TurboTax. I had so many clients using the software that I thought it would be helpful for my clients if I had used it myself. Two things surprised me: First, was how intuitive the software was. The second was how many terms they used that I know only because I am in the business.
You may have seen the letter from Nobel laureate Richard Feynman that he filed with his tax return every year, essentially saying he did his best but couldn’t understand the tax laws. I have to believe most people feel this way. I wanted to keep this article to ten reasons, but if I were to add an eleventh, I’d suggest that if you’re just guessing a lot, it’s time to ask for help.
This article is provided for informational and educational purposes only and should not be construed as investment, tax, or legal advice, or as a recommendation regarding any particular strategy. Whether a Roth conversion is appropriate depends on an individual’s financial circumstances, tax situation, investment objectives, and applicable law. Tax laws are subject to change and their application may vary. Examples discussed are hypothetical and are intended solely to illustrate general planning concepts. They do not reflect the experience of any specific client or guarantee future results. Consult your financial, tax, and legal advisors before implementing any strategy.