This year, I was self-employed part-time with multiple clients, and moved across states to seek a full time job (which I will soon begin). Thus I expect my taxes to be complicated, and have hired a CPA to help me through the process. She wants me to start by calculating my self-employment income and expenses. I got the income part down thanks to time-tracking/invoicing software, but I am not sure which expenses are deductible and what is not (a computer? a business-related subscription?).
Is there software that can help me with this preliminary process – assuming the CPA will double-check everything before submission – but that is NOT made by Intuit or a similarly evil company?
I refuse to do business with a company that actively works against the public interest by lobbying against tax filing reform. Intuit - Wikipedia
I can’t answer your direct question, but years when my income is as complicated as what you state yours is I don’t hire a CPA to “assist” me, I hire someone to do my taxes. Yes, it costs a bit more but the savings in time and stress, and also the improved accuracy, makes it worth it to me. That’s been the case for decades, long before DIY tax software was a thing. Then I’m the one doing the double-checking before it’s submitted.
Perhaps you prefer to DIY and don’t find doing it as stressful as I do, in which case, more power to you, but have you considered a tax preparation professional for your case?
That’s actually my preference. I’ve never worked with a tax professional before and maybe chose the wrong kind? I had hoped she would do my taxes for me. What specifically is that service called, vs what I’m getting now?
My dad is an accountant. He used Lacerte for years and hated that Intuit bought them. But he gritted his teeth and bared it because the cost of switching would be too much, and the other options were not great. I don’t know if things have changed.
As for your taxes, does the new job replace SE job or are you doing both. Here is Schedule C, which shows some of the expenses you can deduct. Your subscription is absolutely deductible if necessary. Things like computers and vehicles and home office are complicated - you generally prorate based on business use. This is one of the things I’d recommend an accountant for, a standard accountant would do everything for you, but it is best if you give them a summary rather than a shoebox full of receipts. If you’re sticking with SE, expect it to be hardest the first year.
CPA is kind of a catch-all tax accountant, you could also look into Enrolled Agents who are more specialized for personal tax returns.
Yes IRS Schedule C form is profit/loss from a business, and that’s what you have to file if you have self-employment income. So you need tax software that will do a schedule C for you.
Unfortunately I don’t have a recommendation that’s not Intuit. I use TurboTax Home and Business and it does a great job for less than $100. I tried a CPA once and they did a fine job but cost $600!
In the past I used the H&R Block software as well and it was decent, but not as good as TurboTax. Also I wouldn’t be surprised if they too lobby to keep the complex tax code.
My wife is a freelance writer, and we started using H&R Block after TurboTax bumped Schedule C from its not very expensive suite. (It replaced it.) It has been fine, but her taxes are fairly easy, just deductions, royalties and 1099s.
The first year she made money she got someone to do her taxes, and he told her what stuff was deductible and what wasn’t. That was a big help.