Why I’m Glad I Have Someone Do Our Taxes

I’ve been lucky enough to have someone do my taxes for as long as I’ve ever had to file them.  How did I get so lucky? Because my dad has been lifelong friends with the guy that does them, and he’s always treated our family very well.

I’ve never questioned his ability, but whenever I see something I don’t understand on a tax return, I ask about it, for the simple sake that I want to understand things.

We re-financed our mortgage last year, so when I was estimating our tax return, I entered the closing costs, but when our tax return came back, this wasn’t on here.  Only a small portion was.

I knew he was correct.  He always is.  So, I didn’t sweat it and in fact I waited until after tax season was done before I dropped him an e-mail asking why the closing costs were nowhere to be found.

He wrote back explaining that for a re-finance, the deduction is spread out over the original term of the loan. Our deductible closing costs were roughly $1,200 for the 15-year mortgage, meaning that we’ll see roughly $80 written off each year for the next 15 years.  In fact, there was $20 written off in 201, which makes sense given that we re-financed with three months left in the year.

(FYI: For an original mortgage on the property, you can write off the entire closing amount for the year in which the closing took place.)

Good to know!

When it comes to doing taxes, I know that I could likely enter the big stuff.  But, honestly, it’s the little stuff like this which makes me really, really glad that we have someone do our taxes.

And not just any someone, but someone we completely trust.

Do you  have someone do your taxes?  Did you know about the re-finance amortization requirement when it comes to writing off the closing costs?

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15 thoughts on “Why I’m Glad I Have Someone Do Our Taxes

  1. Always do my own taxes, using off-the-shelf software. No offense to you or your family friend but the refi deduction issue you describe in your post is routine stuff for even the cheapest tax prep software.

    • Absolutely, and the extra benefit you get there is that he knows your history and can likely spot anything missing or otherwise that could potentially be missed.

  2. We use Turbo Tax. It will ask if you have refinanced, and what the closing costs were and then the program would pro-rate them. We used to use DH’s family tax preparer until she had a breakdown during tax season and stopped returning phone calls, etc. We were expecting a big return that year (due to a one-time tax credit thing) and we had to file an extension because of her. We had another unusual situation this year with taxes (having to do with a mineral rights lease) and it asked the right questions and did the taxes correctly (I compared them with my sister’s….as she had a tax preparer do hers).

    • I have heard it can get pretty stressful for those who get immersed in the tax return business. Proof positive!

  3. My mom has a guy that she uses to do her taxes and she has been using him for years. I guess she trusts him haha. I have been doing my own taxes but once I get married and add a lot of other things that I won’t understand…I’ll probably use the same dude.

  4. I do my own taxes but I also used to work for a CPA firm so I understand my situation. I know the software we used would have caught your refinance amortization and I’m sure I would have looked it up if I were doing my own taxes but I didn’t remember it off hand.

    • I’m sure it would have caught it. It’s just nice to have someone that doesn’t have the potential to make an uh-oh move that could be flagged.

  5. It must be nice to be able to have complete faith in your tax person! Unfortunately, I have had not had similar experiences, and I would have been asking right then and there, just in case the guy had forgotten to put in the closing costs, which would have then meant having to amend the year’s taxes (and more work for him if necessary). But that’s me. 🙂 And again, like I said, I’m glad you know you can really trust the guy, that would be comforting to be able to have that trust.

    • Hopefully at some point you find someone that you can trust and keep in line with him/her for the long term…

  6. I couldn’t even begin to do my own taxes. In the first place, I’m innumerate (did you know there’s actually a condition called “dyscalcula,” similar to dyslexia? just learned that…). So if I tried a) I’d have a nervous breakdown before I could finish and b) whatever I did manage to do would be wrong. And in the second place, the tax laws are so complicated, so arcane, and so rampantly illogical that only a trained, experienced specialist can understand them. Even if I could add, subtract, mulitiply, or divide, I still couldn’t do my taxes.

    • You definitely don’t want to let something so silly as simple math errors be your downfall. Definitely best that you take that element out of your hands.

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