How do you go about paying taxes on your online earnings? Do you hire a CPA or do you handle everything yourself?
In the past I have always handled this myself. It’s always been a breeze to fill out the papers and send them in by April 15. This year, however, things aren’t as easy because I have more than 1 stream of income.
I think I’m in trouble because I didn’t pay any quarterly taxes in 2005. I didn’t know I had to pay a “quarterly” tax — in the past I only worried about April 15. This year I “owe” more than the $1,000 threshold, so I believe I will have to pay the overdue tax, plus 6% interest. :unhappy:
I prefer to do everything myself. I don’t like the idea of some 20y/o H&R Block temp asking questions about my income. I can only imagine how uncomfortable I would be if they started asking questions about the source of my supplemental income. I would say “advertising,” but I’m sure the next question would be, “Oh really? What do you advertise?” “Um… stuff.”
Should H&R Block (or a similar storefront-type tax place) be avoided? Having never worked with a CPA, I have no clue what to expect. For those of you who have dealt with CPAs before — how much detail do you need to provide? How nosey are they? I know some of you rely on CPAs — how do you find a good one that knows his stuff, and that doesn’t ask too many questions?
Summing up — I don’t know how to pay quarterly taxes, I owe the government quite a bit for 2005, and I’m hesitant/nervous about involving anyone else in the tax filing process. Is this something I should learn to handle on my own, or is this something that is better left to a CPA?
I’m sure all of you were in this position at some point in the past…. If you opted for the CPA route, would you say it’s “the best thing you ever did?” Or if you learned to do it yourself, would you say that you’re “sure glad I learned to do that myself; saved a lot of money by not wasting it on a CPA”….
Thanks in advance. Also, if anyone wants to talk on the phone about this, PM me and I’ll send you my number. 
Well it’s a differnt country … and tax law is a lot simpler here in New Zealand than the United States (I beleive) but I’ve always used an accountant.
Lots of benefits :
– You get the re-assurance that you’re doing things right
– You pay the correct taxes at the right time
– You get help in structuring your business in a more tax efficient way.
While I’m pretty much a do-it-yourself sort of person I think that it would be air to say that tax law is far from intuitive. Get expert help. Failing to make payments as you did hurts (with the penalties) and being ignorant of the requirement is no defence.
My accountant costs less than $1,500 a year … and it’s tax deductable. I get to go to sleep at night knowing that this side of the business is correct and covered. One of the easiest and berst decisions I made.
:cheers: