hiring helpers

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kawaivf1
Posts: 50
Joined: Sun Jan 01, 2023 11:26 am

hiring helpers

Post by kawaivf1 »

I wanted to get perspectives on hiring an accountant, and financial planner. Currently I DIY these activities, but not sure if I could benefit from "expert" advice. Sorry if this has been discussed elsewhere in the forum.

Currently I use turbo tax for my taxes. We have a fairly simple tax situation..We are W-2 employees, 2 kids, claim the standard deduction, and import all taxable investment trade information. I feel like we could possibly benefit from some tax planning since I don't optimize that in any way.

I enjoy investing, and doing that research. I use a monte carlo simulator, and firecalc tool for planning purposes. Not sure on the financial planner I feel like the standard FP advice won't really be helpful for people who follow ERE advice.

jacob
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Re: hiring helpers

Post by jacob »

Your situation is pretty simple and within the scope of DIY. I suggest trying to do your taxes by pen and pencil or create your own spreadsheet and use turbotax et al to confirm your results. Doing it by hand shows the "man behind the curtain" that the software conveniently hides. Where the breakpoints are? What difference tax-deferred deductions make? Should your interest-bearing investments sit in an IRA or not?

Since you have kids, so much the better. Dunno how old or smart they are but taxes are 5th grade math except with real world consequences. The only thing that's hard about doing taxes by hand is the necessity of getting an A+ on each and every 5th grade test that is the annual filing. The 1040 instructions are really well written (google "irs 1040 instruction" or "irs 1040 form" with whatever number required.)

Tax optimization is very low hanging fruit. Spending time here has a much higher ROI than doing research on "investments". Spending time here also makes it possible to ask informed questions should you decide to punt and pay for a planner.

kawaivf1
Posts: 50
Joined: Sun Jan 01, 2023 11:26 am

Re: hiring helpers

Post by kawaivf1 »

jacob wrote:
Wed Mar 01, 2023 11:40 am
Your situation is pretty simple and within the scope of DIY. I suggest trying to do your taxes by pen and pencil or create your own spreadsheet and use turbotax et al to confirm your results. Doing it by hand shows the "man behind the curtain" that the software conveniently hides. Where the breakpoints are? What difference tax-deferred deductions make? Should your interest-bearing investments sit in an IRA or not?

Since you have kids, so much the better. Dunno how old or smart they are but taxes are 5th grade math except with real world consequences. The only thing that's hard about doing taxes by hand is the necessity of getting an A+ on each and every 5th grade test that is the annual filing. The 1040 instructions are really well written (google "irs 1040 instruction" or "irs 1040 form" with whatever number required.)

Tax optimization is very low hanging fruit. Spending time here has a much higher ROI than doing research on "investments". Spending time here also makes it possible to ask informed questions should you decide to punt and pay for a planner.
My kids are still very young 4 & 2. But I do plan on teaching them these skills one day so they have a basic understanding of how to do their own taxes. I was lucky enough to take a personal finance course in high school that had us do the pen and paper method. (I regret getting lazy and not continuing with the pen & paper) I feel like It has been so long since I have done it that it might be a good idea to start doing it again.

One other consideration we have been making that seems like a win-win is starting a donor-advised fund. It seems like we benefit from a tax stand point, and the charities benefit from higher donations.. Any recommendations are welcome? We have accounts with Fidelity so it seems like that would be a simple process of opening an account with them.

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