Dear PoPville – Looking for a Tax Professional

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“Dear PoPville,

My husband and I just got married this year. We also bought a condo together this year and did some renovations on it. Additionally, I have significant student loans and I am currently participating in the Public Service Loan Forgiveness program and making income-based payments. All of this is a long way of saying that we think this is finally the year where seeing a tax professional is probably worthwhile, since we’re not sure Turbotax can walk us through our best options here. Do you or might any of your readers have recommendations for a tax professional for us to go see? Our coworkers and friends mostly seem to use Turbotax or do their taxes themselves, but especially with my student loan situation (which presents a question of whether it’s better to file jointly or married filing separately) we feel like a professional would really help but we don’t know where to start in finding someone good.”

43 Comment

  • PoP, if you put me in touch with the person who submitted this post offline, I can suggest a fantastic CPA who is building a tax practice here in DC, and who has tackled these very issues for lots of newlyweds and grad students.

    • epric002

      i’d be interested in a recommendation as well liz.

    • Yo, post an email address up here. I’m in the same boat and will be facing similar issues as the OP over the next 2 to 3 years. Might as well start now with the CPA. I especially want advice on student loan, deductions, and getting the best bang for my buck.

    • If you have Federal Direct Student Loans, you should consolidate and change your loan terms to get that amortization stretched out to 20 or 30 years. If you plan on being in your job for 10 years as a government employee, you’ll get the remaining principle and interest forgiven after making 120 on-time monthly payments.

    • I would be interested in the recommendation as well. I haven’t been able to find a CPA who has knowledge of the student loan repayment programs. Thanks!

  • I have someone I’ve used for years. Based in Kensington MD, but they handle DC/MD/VA. Excellent service. Maybe not the cheapest option, but exceptionally professional. Happy to recommend if you put me in touch off line.

  • I’m going to be contrarian: if you bought the condo to live in and not to rent out as an investment, there’s nothing to it and TurboTax can absolutely handle it. You’ll get a statement from the bank at the end of the year on how much interest you paid. You enter that into TurboTax as an itemized deduction. That’s it. Nothing else is deductible, including the cost of renovations. Just save your invoices for when you sell the house; you’ll need them to determine exactly what you paid for the place so you can figure out your profit, although even there you’re not likely to pay any taxes because married home buyers get a $500,000 exemption for profit on the sale of their home.

    I also don’t see how your loan forgiveness program has anything to do with taxes, unless the amount that you’re forgiven is taxable. But if that’s the case, I can’t imagine TurboTax can’t handle it.

  • I’m going to be contrarian: if you bought the condo to live in and not to rent out as an investment, there’s nothing to it and TurboTax can absolutely handle it. You’ll get a statement from the bank at the end of the year on how much mortgage interest you paid. You enter that into TurboTax as an itemized deduction. That’s it. Nothing else is deductible, including the cost of renovations. Just save your invoices for when you sell the house; you’ll need them to determine exactly what you paid for the place so you can figure out your profit, although even there you’re not likely to pay any taxes because married home buyers get a $500,000 exemption for profit on the sale of their home.

    I also don’t see how your loan forgiveness program has anything to do with taxes, unless the amount that you’re forgiven is taxable. But if that’s the case, I can’t imagine TurboTax can’t handle it.

    Finally, on the question of whether it’s better to file separately or jointly, it’s almost always better to file jointly, but you can just try it both ways on TurboTax and go with the one with the lower tax figure.

  • As FYI, my tax situation is somewhat more complicated and I use turbotax and find it completely adequate.

  • I’m going to encourage you not to see a tax professional and try filing them yourself. Filing separately almost never results in a better tax situation for a couple and if you’re itemizing deductions (which I assume you are, since you bought a condo) it would be a huge mistake to file separately. Your student loan payments are not any different from anyone else’s loan payments and will be very straightforward to add yourself using a tax software once you get the tax form from your lender. Sorry if this sounds harsh– I’ve done hundreds of free tax returns as a volunteer and just want to reassure you that it’s not hard and wanted to save you a few hundred dollars at H&R Block.

    • I tend to agree, you should have no issues using Turbotax. I know your situation SEEMS complicated, but it isn’t that bad.

      As a CPA, agree with the above statement.

    • I am also on IBR for student loans and it was my understanding that if you file jointly, your payment then becomes based on the joint tax return, which could drastically increase her payments and may negate the benefits of the Public Loan Forgiveness program so I think it is may be more complicated than just filing.

      • TurboTax still works in this case – you can fill it out as if filing jointly then fill it out as if filing singly, and see what the difference in tax bills is.

      • Yes, and to put it another way–the issue isn’t really that her student loan payments will have an effect on the amount of taxes owed/refunded, but rather that the way OP files taxes (separately or jointly) will have an effect on her eligibility for IBR and the way her lender will calculate the monthly loan payment amount.

    • I actually disagree – when we bought our condo, the downpayment came in part from cashing out investments that were in my name only. By filing separately, we were able to preserve the tax deduction entirely for my spouse, while I had to pay taxes on the unearned income through investments. Filing jointly does work better now, but there are some occasions where separate returns can save you hundreds, if not thousands.

    • I’m also a tax volunteer (and Anon 4:01 below, forgot to sign in), and I just wanted to clarify that in this case the OP’s student loan payments ARE different than the average person’s because she is on an income-based repayment plan that was calculated based on her income alone, not her joint marital/household income. So in order to maintain her eligibility for the lower IBR payments, she would need to file married separately. If she files MFJ, her lender will recalculate those payments based on the couple’s combined household income. (I only know this because I’m about to go on IBR myself, so I’ve looked into the tax and marriage implications.) For the vast majority of free tax prep clients, MFS doesn’t make sense because they lose the opportunity to get the EITC and the child tax credit, which tend to be an important income boost for low-/mod-income parents. But it doesn’t sound like the OP would qualify for either of those tax credits, and as a result of the IBR she has an unusual situation where MFJ could actually end up costing her more than MFS. Of course, without having the full picture, it’s impossible to say for sure–best thing is to do a test run of MFJ and MFS and see how the financial difference between those two options compares to the $8,000 that her student loan payments would increase annually if she filed jointly and in doing so, was forced to exit IBR.

  • epric002

    i’m surprised at all the endorsements of turbotax. i used it for years and never got anything more than a few bucks back, usually i owed money. i also found it difficult to use. i used a CPA for the first time last year and his fee was WELL worth what i got back in refunds.

    • Can you share what your CPA find that TurboTax didn’t?

      • epric002

        i’d have to go back and look for specifics. but my situation had changed (similar to the OP)- newly wed, student, bought a house, etc.

        • I guess then I wonder if it was the difference between a CPA and TurboTax or just the changed situation that led to the refunds.

          • epric002

            i’m not sure, though i suspect it was both. either way, i’m happy to shell out a little extra for the accountant if it means i’m actually getting a refund, where as i’ve been paying for turbotax every year and getting nothing back, and usually owing money.

          • Based on my research a CPA is going to cost you around $400. Are you really getting that much more back?

          • epric002

            i shouldn’t have chimed in here since i don’t have/remember the specifics, BUT, yes, i got back much more than the cost of the CPA.

  • We really like Mike Fine at Finesse Tax. He’s in the neighborhood and does a great job for us each year. He is very responsive and his rates are fair.

  • I am the one who sent the question in, so I thought I’d pipe up early since I anticipated that many people would quickly chime in with, “You really don’t need to see a professional!” (In fact, I joked about how this was sure to happen in my emails with PoP.) Anyway, for the people who think this is such a cut and dry tax situation, please consider this: I’m currently on Income-Based Repayment for my loans, making “qualifying” payments towards the ten-year Public Student Loan Forgiveness program. My loan bill each month is about $600, based on my single income. If I were to start making the standard ten-year payment each month, that bill would be between $1200 and $1300. If I file my taxes jointly with my new husband, my loan servicer will take both of our incomes into consideration when calculating my IBR loan payment and we will be making too much, by their standards, and my payment will by default become the ten-year payment amount. To spell it out for you, my loan payment will more than double. So that’s an extra $650/month, or roughly $8000 a year in high loan payments. If I keep filing on my own, the loan payment stays low, but I presumably lose some or all of the tax benefits of being married. The entire premise of the PSLF program is to make as low of a qualifying payment as you possibly can now, and maximize the amount that the government forgives at the end of ten years. So maybe some of you can now understand why I feel skeptical that paying $8000 a year more in student loans will be offset by whatever benefit we may be eligible for, tax wise, as married people. Maybe it is ultimately worth it, but I would feel better about making this decision if someone who knows more about this than I do can walk us through the options we have. Considering how much money is at stake, for two people who aren’t making that much to begin with, it seems at least reasonably prudent to seek a more informed opinion.

    That being said, thank you to the posters who offered concrete professional recommendations and for those of you who are willing to suggest a professional to me only via email, I’m happy to let PoP put us in touch.

    • We hear you, and it’s your money, but all you need to do is run TurboTax twice, once filing jointly and another separately, and you’ll get the answer you need.

      • You act like that’s so easy. 🙂

        • An extra hour (max) in front of TurboTax in your PJs with a cup of tea on some miserable March Saturday. Way easier than pulling together the files your CPA needs, getting yourself to their office, waiting around, etc. And several hundred dollars of CPA fees saved to buy beer to celebrate finishing your taxes!

        • That is the thing. It is not that hard. People tend to have such a phobia about taxes and how complicated they seem but most people with basic reading comprehension skills can handle it. OP, you definitely sound like you can handle it since you have already identified the issues you need to look out for. Before turbo tax I used to calculate my stuff using the worksheets. I got a 550 on math SAT mind you (prior to the new scoring system) and have zero accounting training.

      • And you’ll only pay for TurboTax once, when you file. You can change the numbers as much as you want up until then, and TT provides a running tally off to the side of what your tax refund/bill will be.

    • If it is an $8,000 difference in higher student loan payments, I can save you the time, you are better of filing single, as any sort of marriage deductions you get will not come close to $8,000. Unless your partner makes like $400,000, and you make $35,000.

    • I understood the IBR implications of your question, but I still think that you could get some clarity–at least as a first step–by using a self-directed system like Turbotax or H&R Block online. They make it pretty easy to input your info by asking you questions about your circumstances and all the forms you received–and you could experiment with filing jointly vs. filing separately and see the tax differences with each option. (I’ve never used Turbotax, but H&R Block will let you tinker with your information and will show a running ticker of your refund/amount owed before you get to the part where you have to pay and hit the “file” button. I imagine Turbotax is similar.) Everyone’s tax situation is different, so without running two versions of your taxes, it’s hard to say whether MFS would be substantially more expensive than MFJ. I do taxes for low-/mod-income individuals, and in most cases we discourage MFS because MFS filings aren’t eligible to take the Earned Income Tax Credit or the Child Tax Credit, both of which can be major for a low-wage worker; however, if you don’t have kids, and you have a middle-class income, you wouldn’t be eligible for those credits, anyway. The crux of your question seems to be the IBR issue, and I would actually NOT assume that a CPA will automatically be knowledgable about IBR (or any other student loan issue) and how your tax situation will impact that. Having said all that, you should absolutely choose whatever tax-filing option will make you feel comfortable and give you peace of mind. I have a bias toward do-it-yourself filing because many people’s tax situations are not as complex as they think (we’ve been conditioned to think taxes are unsurmountably complex and scary, even when they are not), and I hate to see people spending hundreds of dollars on a CPA unnecessarily. You could also get a couple of price quotes from a CPA as well as give Turbotax or H&R Block a test-run–as I said, you don’t have to pay until you actually file, so you can input your info online, see what those systems say, and then just not go through with the filing if you ultimately decide you feel more comfortable going the CPA route. Just be aware that if you use a professional, it is ALWAYS a good idea to review the tax forms yourself as a backup, to make sure everything that should be entered was indeed entered. I have seen some really egregious mistakes made by CPAs (not necessarily out of ignorance, likely just carelessness, because they were very simple/obvious mistakes); also, it is not uncommon for the CPA to be your point of contact, but then hand off your return to someone junior in the office to complete, and then the CPA does the final sign-off on it.

    • Hey OP, I’m with you. We are in a nearly identical situation. It seems easy enough to make a straight comparison for this year, but my concern is it will have implications for years down the road. Perhaps all I’d be paying for is peace of mind, but I just don’t want to make a short-sighted decision. I would love to hear the recommendations as well. And FWIW, in years past I have actually enjoyed using TurboTax, and I like math.

  • If your loan forgiveness program depends on the income per your tax returns and if your spouse’s income will impact your payments, then it might be worth it to file separately. Even then, it isn’t necessarily more complex, if you have any student loan deductions, they stay on your return, any joint deductions (such as home loan interest, gets split in two).

    One thing that many newly married couples fail to update is their personal withholdings on their W-4s, which can definitely impact if you owe or get a refund. Or, they don’t fill them out properly.

    • I agree with this in general, but married persons filing separately are not eligible for the student loan interest deduction. In your case it doesn’t sound like filing together to take the student loan deduction would be worth it because it might result in $500 refund max.

      • The student loan interest deduction is totally eliminated once you hit ~$85K in salary. Not worth worrying about if you’re the typical over-educated PoP’ville yuppie.

  • I was on the fence about getting a CPA one year, so I called a couple. I actually got them to answer the biggest question I had, about whether we should file jointly or separately, without having to pay them anything. So I took their advice (filing separately) and did TurboTax.

  • I highly recommend John Caldwell at Malvin, Riggins & Company, P.C. They do our tax returns and are fantastic. Very professional and very prompt in response. Even to texts. We tried 2 other CPAs in DC, which were awful. Can’t recommend John and his team enough.

  • Hi OP
    My husband and I were in a similar situation about 2 years ago. We go to The Original Tax Center up in Cleveland Park. We started going there in 2011 and have been really pleased. I know it can be stressful and for us it was worth sitting down with a professional the first time we were filing together. Good luck!

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