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by pclmulqdq 1241 days ago
It turns out that paying an accountant is a good defense against audits if your tax situation has any complexity at all
2 comments

Is it though. You're the one liable for issues on your tax return. You're the one who signed the return.
There is actually a spot on tax forms that indicate the form is being filled and filed by a 3rd party.
Sure, and penalties might not be assessed. But that doesn't stop you from being liable for the unpaid taxes.
If you file a complicated tax return and the "prepared by" line is not a CPA, you get targeted as someone who probably did something wrong. The IRS is more likely to go for you.
Sorry I assumed my question implied that was what was being asked. What is the complexity because I’ve done my own taxes for two decades, every year things are nuanced and slightly different. Never have I used an accountant.
> What is the complexity

I send my bank statements, credit card bills and other documents to my accountant. He produces a return, together with optimisation advice for the coming year. It’s well worth the money. (I also have real estate, private equity, fund interests and emerging trust situations, and am multi-state.)

The value is:

1. You don't have to figure out which forms to file by yourself. This quickly becomes non-trivial if you run a business, take a lot of deductions, or have weird forms of income.

2. The IRS sees that your return was prepared by a professional, so it is much less likely that they will try for an audit (since a professional will be representing you).

If your tax liability is under $100k and your return is under ~20 pages, you mostly don't need one, but an accountant also doesn't charge much either (about the same price as TurboTax).