5 Signs You Need a Tax Professional

Imagine this: You're sitting at your makeshift home office, going over your tax forms with a fine-tooth comb. You feel pretty confident that you've filled out everything correctly and are ready to send off your paperwork. But then, just as you're about to seal the envelope or hit the "submit" button, you realize that you've forgotten one crucial form: the one the IRS actually cares about.

That sinking feeling is all too common for many freelancers, expats, and nomads. But fear not, even the most tax-savvy individuals can overlook important details. In fact, it might be a clear sign that it's time to hire a tax professional. Here are 5 signs that you need to bring in the pros.

Understanding the Tax Concept

Taxes are complicated, especially for those juggling multiple income streams, living abroad, or dealing with unfamiliar tax situations. The tax concept is not just about filling out forms. It involves understanding the tax laws, both federal and state, and how they apply to your specific situation.

For instance, did you know that if you're a U.S. citizen living abroad, you're still required to file a U.S. tax return? Or that if you're a freelancer, you need to pay self-employment taxes, which includes both Social Security and Medicare taxes? And let's not even get started on the complexity of state taxes when you're a digital nomad moving from place to place.

What to Do About It

If any of this is news to you, or if you're feeling overwhelmed by the sheer complexity of your tax situation, it's time to consider hiring a tax professional. They can help you navigate the tricky waters of the tax world, ensuring that you stay compliant and avoid costly mistakes.

Common mistakes include underreporting income, not understanding how to handle foreign income, or not knowing about important deductions or credits you could be claiming.

Take our universal freelancer friend for instance, who after a year of hustling and bustling, found herself in a bind because she had been accepting payments via Venmo, but completely overlooked the Foreign Bank and Financial Accounts (FBAR) requirement.

Common Mistakes

Perhaps you're thinking, "I'm too small to catch the IRS's attention." Well, think again. One client, for example, had six Stripe accounts and was blissfully unaware that they were hitting a filing threshold. The reality is that the IRS doesn't discriminate. Whether you're a big fish or a small fry, if you're not compliant, you could end up on their radar.

Another common mistake is not keeping proper records. As a freelancer, you're responsible for tracking your income and expenses. If you're audited, the IRS will want to see proof of both. So, if you've been lax about keeping receipts or tracking expenses, it's time to step up your game.

Resources or Strategies

that Actually Help

The good news is, there are plenty of resources and strategies that can help you stay on top of your tax game. Online tools and apps can help you track income and expenses, and there are numerous tax guides and resources available online. However, the best resource is often a tax professional who can provide personalized advice and guidance.

The Next Step

Overthinking this? You're not alone. Taxes are complicated and can be overwhelming, especially for freelancers and those living abroad. But remember, there's no shame in asking for help. In fact, hiring a tax professional could save you time, stress, and potentially a lot of money.

Still unsure which form applies or which tax rules you need to follow? Don’t sweat it. We're here to make it make sense. Upload your documents, and we'll untangle the complex web of tax compliance for you. You can then get back to focusing on what you do best, knowing that your taxes are in safe hands.