TurboTax vs. CPA: Which Is Better for You?

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We’re nearing tax time and that means one thing – you must decide how you’ll complete your taxes. Will you go the DIY route or pay a CPA to do your taxes for you?

A common debate at tax time is TurboTax vs a CPA (Certified Public Accountant) – which is better and/or right for you? Check out this guide on the difference between the two and how to tell which option will suit you the most.

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When Would I Need a CPA?

Using a CPA to file your taxes is important when you’ve had major changes in your life, or you have a complicated tax situation.

Tax Updates with couple meeting tax advisor wondering which is better: turbotax vs cpa

What makes a tax situation complicated varies by person, though. For example, you may run your own business and be perfectly comfortable filing your own taxes using TurboTax. Your neighbor, however, may find it much too complicated and opt to hire a Certified Public Accountant.

Here are a few other situations when a CPA may be a good fit if you:

A CPA can walk you through what you’d need to file your taxes given any complicated situations and can ensure that your taxes are file correctly, reducing the risk of an audit.

What is TurboTax?

TurboTax is tax software you can buy to do your taxes yourself. TurboTax is one of the most popular tax preparation software on the market today, although there are many other options too.

TurboTax Home Page Screenshot
TurboTax Home Page Screenshot

Anyone can use online tax software as long as they know what documentation they need and are capable of inputting the information into the program.

Once entered, TurboTax does the rest of the work for you. Even if you don’t know much about tax code, the program asks enough questions to get you through the process easily.

Is TurboTax Completely Free?

When comparing TurboTax vs a CPA, most people assume TurboTax is cheaper. But it’s not always.

TurboTax Home Page Screenshot with black lady
TurboTax Home Page Screenshot

Is there a free version?

Yes, but not everyone is eligible. Only taxpayers with a ‘simple tax return’ are eligible. Basically, this means if you have only W-2s or unemployment income and take the standard deduction is TurboTax free.

If you don’t qualify for a free program, the costs might be higher than you’d expect.

How Much is TurboTax?

TurboTax has several plans to choose from, each with a different cost:

  • TurboTax Deluxe $60 Federal/$50 State – If you’re a homeowner or want to make sure you maximize your deductions, this is the program for you. It will walk you through all possible tax deductions and credits and even help you calculate your charitable deductions.
  • TurboTax Premier $90 Federal/$50 State – If you’re an investor, this is the plan for you. TurboTax Premier walks you through all deductions and credits for real estate investors and stock market investors, plus get all the features included in the Deluxe plan.
  • TurboTax Self-Employed $120 Federal/$50 State – If you own your own small business, are a freelancer, or consultant, this plan will help you have the most accurate tax return. You’ll learn how to maximize your business deductions and plan your income/taxes for next year.

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How Hard is it to do your own Taxes?

Preparing your own taxes without tax preparation software is difficult unless you know what you’re doing. But, with tax software programs, like TurboTax, it can be easy. If you can read and follow the prompts throughout the program, you can file your own taxes.

Small business owners happy to be doing taxes with turbotax vs cpa

If you’re unsure about certain income or whether or not something qualifies you for a deduction, you may want help, but even TurboTax provides assistance (typically included) from a live CPA.

Key Differences Between TurboTax and a CPA

You may wonder why anyone would use a CPA when TurboTax and other tax software programs offer step-by-step instructions to file your taxes.

There is one key difference – tax planning. TurboTax can ensure you are following all tax laws, but it doesn’t help as far as tax planning.

If you’re an investor, business owner, or have other complicated tax situations, you may benefit from the assistance a CPA could provide. Not only would he/she help you file your taxes, but they would also help you plan for future years, especially if you overpaid in taxes this year.

8 Easy Tips for Filing Taxes This Year

  1. Keep careful documentation of all income, expenses, and potential deductions
  2. If you run a business, keep your personal income and business income separate
  3. Thoroughly cover all available tax deductions and credits and if you’re unsure ask a professional
  4. Make sure you report all income, no matter how small
  5. Consider contributing to a pre-tax retirement account to lower your tax liability
  6. File your taxes on time
  7. If you can’t pay the full liability, work out a payment arrangement with the IRS right away
  8. Pay your estimated quarterly taxes if you’re self-employed

Remember: Keep track of your expenses and income on a spreadsheet or bookkeeping program such as FreshBooks.

Final Thoughts

When looking at TurboTax vs a CPA, it’s a big decision. But, if you use a CPA to handle your finances outside of your taxes, it’s a no-brainer. Consistency is key and who better to handle your taxes than the person who already handles your finances?

If you’re a DIY person, though, TurboTax is a great platform to use. It makes filing your taxes simple, almost as if you know what you’re doing.

TurboTax vs. CPA Which Is Better for You
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Honestly, though, if you have the necessary documentation and are confident in the information you have, filing your own taxes isn’t as hard as it seems.

If you’re ever in doubt though, there’s always a professional CPA ready and willing to help.

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The Handy Tax Guy Tax Service

Disclaimer Statement: All data and information provided on this site is for informational purposes only. The Handy Tax Guy makes no absolute representation of the correctness, mistakes, omissions, delays, appropriateness, or legitimacy of any information on this site. **Note: Each client circumstance will vary on a case-by-case basis**

Nikida Metellus

Nikida Metellus is a financial freedom advocate, author, and the reimagined voice behind ThemeParkHipster.com, now focused on helping you achieve a debt-free life and financial success. Based in Orlando, Florida, she combines her love for theme parks with actionable financial strategies, offering a unique perspective on balancing fun and finances. As the author of Complete Tax Planning Guide, she has now expanded her expertise to guide you on the road to financial freedom. Co-founder of Bramework and a coffee enthusiast at heart, Nikida is committed to empowering you with practical tips and insights to manage your money wisely. When she's not blogging or exploring Florida's attractions, she enjoys quality time with her husband and two daughters. Welcome to your journey toward a financially free life!

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