I live in California and me and my wife bought our first ever house this last year. In the past I have done my own taxes, because they were pretty easy, earnings, a few deductions,etc. But now that we bought a house I feel we have entered into, at least for this year, some new tax territory that might make it worthwhile to hire a professional, just to be sure I can take advantage of it fully.
Opinions? Is it worth the price? How much should I expect to pay? How do I shopr for a good one?
YMMV and all… I don’t think you need one.
I’ve had no problem preparing taxes on the green box with a home sale and purchase. The green box does a pretty good job of walking you through home purchases. The bank sends me forms at the end of Jan on deductible mortgage interest, and then I used Google to figure out what about the closing costs were deductible. The sale was more complex since I sold within less than 24 months of purchase, though.
But as always YMMV.
TurboTax or Taxcut will ask you if you bought a home in the past year, and will walk you through any consequences. Basically, depending upon when in the year you bought, your mortgage interest is likely to be a large deduction. Some of your closing costs may also be deductible, and the programs should tell you which ones. If you weren’t itemizing before, it may well be worth it to do so now. But the computer programs are set up to make all of that quite easy.
If the only hiccup in your tax situation is a new house, then I agree that for the cost, Turbo Tax is more economical than a tax professional. I’ve used Turbo Tax for a number of years now, and it really is easy. They ask you all sorts of questions (kind of like choose your own adventure) and so it’s pretty easy to make sure that they catch all the things you need to catch.
But if you want to use a professional, I’d start by asking around to see if anyone you know has a good one. And given that it sounds like your tax situation is pretty straightforward, make sure whoever you pick has time to do your taxes first so that you don’t have to file for an extension. Not that there’s anything wrong with filing for an extension, but if you’ve got a simple situation, you shouldn’t have to wait to get it all resolved.
I agree that TurboTax is good for you. My wife is a freelance writer, so her stuff is complicated, and we used a professional preparer for some years, but we finally decided that we learned from that how to handle the return. We’ve never had a problem. TurboTax will ask you if you have bought a house, and I suspect go through all the necessary questions. I haven’t used it for that, since we bought ours while still using a professional.