Hiring CPA vs. DIY Online Software

[Jacob Henderson]

Looking for some advice on which route to take to get my taxes done this year. In the past I had only W2 income and a single member LLC for drone video production, so using an online tax software has worked well for me. This year, I bought my first duplex (househack) and I started my career as a real estate agent, so a lot that has changed with multiple streams of income.

Today I spoke with the CPA that my broker uses (who is also an investor) and it seems like the easiest yet most expensive route to take. He charges $140 an hour and said the first year will probably take about 4 hours of work but the following years should take less time once initial paperwork is set up. On the other hand I could file my taxes online like I had in the past for about $100. 

I plan to continue to add properties to my portfolio and think it would be wise to start a relationship with a tax professional now rather than later.

Does it make sense for me to hire a CPA this year or should I wait until I grow my portfolio further?

Any and all experience/advice is appreciated.

Thanks!

[Natalie Kolodij]

I'm obviously biased- But I can tell you I amend more incorrectly setup rental returns than any thing else. Either amend, or file depreciation adjustments. 

Don't step over dollars to pick up pennies. A good tax pro will save you more than they cost you, and be able to offer you solid advice on strategy for growing your portfolio and minimizing taxes moving forward. 

I can tell you a traditional hourly CPA isn't always a good fir for that because A. They don't specialize in REI and yes it matters. B. He's going to charge you for all of your calls when you want to know what ifs. "What if I sell this house, what if I 1031, ect" His time is what you're paying for regardless of the value it adds you.