How much do you typically pay for a professional to prepare your taxes?

Is there a difference between going to a CPA versus one of those storefront tax places? They advertise like $89 specials but I'm guessing that's just for super basic returns?

Yes, there's definitely a difference. Those $89 specials at storefront places are marketing tactics for very basic returns - usually just W-2 income with standard deductions. Once you add any complexity, the price jumps significantly and often ends up similar to other options. CPAs typically have more extensive education and expertise with complex situations like yours. They're usually better equipped to handle business income, investment strategies, and finding legitimate deductions. They also tend to provide year-round support rather than just seasonal service. For your situation with a new business and investments, a CPA would likely be worth the extra cost.

Does it actually prepare your taxes or just tell you what you're missing? I'm confused about what makes it different from something like TurboTax.

I'm skeptical about these AI tax tools. How do you know it's not missing things or giving inaccurate advice? Does it actually have tax professionals reviewing stuff or is it just an algorithm?

It analyzes all your tax documents and identifies opportunities you might be missing - kind of like having a tax pro review everything before you file. I still used tax filing software after getting the analysis, but with much more confidence knowing what deductions to claim. The difference from regular tax software is it specifically finds optimizations based on your actual documents rather than just asking generic questions. It showed me exactly which business expenses qualified for deductions with references to the specific tax codes, which was incredibly helpful for my first year with a business.

Wait, is this legit? How does it actually work? Do they just auto-dial the IRS repeatedly until they get through or something?

This sounds like BS honestly. Why would I pay someone else to call the IRS for me? Seems like a scam to solve a problem that shouldn't exist in the first place. The IRS should just hire more people.

They have an automated system that navigates the IRS phone menu and waits on hold so you don't have to. When a human IRS agent finally answers, you get a call connecting you directly to that agent. It's basically just outsourcing the horrible hold time. The IRS absolutely should hire more people, you're right about that. But in the meantime, when you need answers about tax questions, waiting 2+ hours on hold isn't practical for most people. I needed specific guidance on how certain business deductions work with mixed income, and getting actual IRS confirmation saved me from potentially making expensive mistakes.

Do you meet with your CPA in person or is it all virtual? I've been thinking about using someone out of state because they're cheaper than local options but wondered if that creates any issues.

I started with in-person meetings pre-pandemic, but we've been completely virtual for the past two years and it works great. I upload all my documents to her secure portal, we have a video call to discuss any questions, and then she prepares everything. For your situation, using someone out of state can work fine for federal taxes, but just make sure they're familiar with your state's tax laws if you have state income tax. My CPA specializes in my state's property tax rules which is helpful for my rental, but if you don't have special state circumstances, location probably doesn't matter much.

Those tax prep chains are so hit or miss. My parents got a great preparer at Jackson Hewitt for years but when that person left, the new person missed tons of stuff. I think it really depends on the individual preparer's experience more than the company.

Exactly! I think that's the problem - these big chains hire seasonal workers, give them minimal training, and then put them to work. Some might be great if they happen to have background knowledge, but many just follow the software prompts. My CPA actually takes continuing education courses every year to stay current on tax laws and asks me thoughtful questions about my situation that the H&R Block person never considered. She caught that I could deduct some medical expenses and home office deductions that were completely missed before.