Preparing one's own personal income tax returns is not necessarily difficult. Many people have straightforward income from jobs and only a few deductions. Business returns are another story.
I've seen many returns prepared by business owners. A number of them contained mistakes that resulted in larger tax bills than were necessary. The most common is not being aware of what expenditures might be deductible in the first place. Other returns get audited, not so much because of the deductions they took, but in the way the deductions were presented on their returns.
One example is a N.M. gross receipts tax case where the return contained the wrong standard industry code. The code was for a real estate development business. The owner was actually a real estate sales associate. In N.M. those people are not subject to GRT. Using the wrong SIC code caused N.M. Taxation & Revenue Dept. to mistakenly believe this was a taxable business that had't reported its GRT. In the end no tax was due. Nevertheless, there were other consequences. Understandably, the owner worried a lot about having to undergo an audit. The owner had to take time away from earning their living. And they paid for professional representation. (They could have represented themselves; but, hat's a topic for another discussion.)
Another case involved a return where the deduction for office expenses included other types of expenses. The owner used it as a sort a catch-all because they shoehorned everything that wasn't a preprinted line item into office expenses. The result was that the amount of the office supplies deduction was unusually large compared with the business's sales. The IRS noticed this and flagged the return for an audit. While many of the misclassified expenses were legitimate, the IRS uncovered some that weren't.
How about sharing your stories of what went wrong because you prepared your own return or the success you had by having your return professionally prepared.
