Tax Season: The Payoff of Hiring an Expert

I'm a big believer in DIY across the board, from home repairs to portfolio management. But sometimes you can gain a lot by calling in the experts.One of our family resolutions for 2018 was to spend our hard-earned dollars taking care of the things we already have, instead of accumulating a bunch of new stuff. After about one minute of deliberation, my husband and I agreed the best place to start was with our house. We have a tendency to put off minor repairs and maintenance, and I resolved to turn this around.We’d been dealing with some minor plumbing issues (or more accurately, not dealing with them). First we lost water pressure in our master shower. Then one of the bathroom sinks began draining really slowly. We made plans to watch YouTube videos and fix everything ourselves, but we never got around to it.Then we lost water pressure in our second shower. And the toilet backed up. Christian gave the toilet a nervous, tentative plunging effort, with no success. Thinking there might be a major problem contributing to all of these issues, we finally gave up our DIY dreams and called in an expert.The results were a huge relief. The issues were unrelated, and Andre, the plumber, fixed BOTH showers for a reasonable price. But the best part was that he also fixed the slow-draining sink and the backed up toilet for free. Why? Because each problem only took him two minutes to solve. With the backed up toilet, he said, “There’s a technique to it. If you know it, you can fix it in 30 seconds. If you don’t, you could cause it to overflow onto your floor.” Not a pleasant scenario.

Sometimes the right choice is to call in the experts.

Last summer, a new client came to my office with a big problem. She had a $25,000 tax liability from selling a rental house in 2017. She and I put together an aggressive plan to reduce her taxable income for 2017 in the hopes that we could cut down part of her tax bill, but I suspected something more could be done.Since I don’t give tax advice, I recommended she call a CPA with specialized expertise. She did just that, and her new CPA went back and re-filed some old tax returns that had been calculated incorrectly. The best part is that when he calculated her 2017 tax bill (correctly this time), her $25,000 tax liability had turned into a $6,600 refund. That’s a $31,600 difference!This is an extreme example, but one that underlines the potential value of hiring experts to handle the issues they are trained to handle.I'm a big believer in helping people DIY their finances. I also know that sometimes it helps to get a second opinion. If you have any questions about portfolio management or the role of a fiduciary financial advisor, feel free to call me or "Get in Touch" via the form below.