CPA or DIY? The Definitive Guide to Choosing the Best Tax Filing Strategy

Tax season can feel overwhelming, but the good news is, you have options for filing your taxes. Nearly half of American taxpayers use tax software to prepare and file their tax returns, according to a survey commissioned by The College Investor. There can be a lot more to tax season than filling in some numbers and shooting that return off to the Internal Revenue Service, however.

Key Takeaways

• The rules and training for becoming a CPA are stringent and include continuing education requirements.
• Your choice might depend on whether you have to report income from sources other than a regular job.
• Filing your own tax return can be much less expensive, and the IRS offers programs that some taxpayers can use for free.

“The advantage of having a CPA prepare your tax return is that someone has your back,” says Deb Camp, a certified public accountant in Linwood, NJ.

What Does It Take to Become a CPA?

The rules and requirements for becoming a Certified Public Accountant (CPA) can vary by state but some are common.

All states require that a candidate must have at least 150 hours of college education and a bachelor’s degree to become a CPA. One year of experience or the equivalent is also required although some states set the bar higher. Indiana requires two years and this must be confirmed by an active CPA. Many states also mandate that candidates pass an ethics exam in addition to the Uniform CPA Examination.

CPAs must complete continuing professional education (CPE), including a set number of hours of coursework per year (varies by state), most of which focuses on evolving tax laws.

Simple vs. Complicated Returns

There’s tax preparation and then there’s tax preparation. “People who have only W-2 income should prepare their own returns,” says Camp. “There’s very little that can go wrong if you’re just reporting income from your W-2 form.”

Form W-2 is the Wage and Income Statement you’ll receive from your employer after the close of the tax year. It shows how much you were paid, any benefits you received, and taxes your employer withheld from your pay and forwarded to the Internal Revenue Service (IRS) on your behalf.

1099 forms are another matter entirely. They report income you receive from investments, selling assets, or performing work as a sole proprietor or independent contractor. The 1099 income sources don’t stop there, however. There are 21 different 1099 forms that cover income such as cancellation of debt, pension and retirement plan distributions, royalties, prizes, and third-party network transactions.

Taxes generally aren’t withheld from 1099 income and you can often claim deductions against some of these sources as well. Reporting it opens the door to some complicated tax provisions and rules that you may not be able to handle yourself.

How Much Does Tax Preparation Cost?

The National Society of Accountants reports that the average cost of professional tax preparation can range from about $220 to more than $1,200 depending on the complexity of a taxpayer’s return and their location. Hourly rates span from $150 to more than $200 an hour.

Using tax software is considerably less expensive. The TurboTax Deluxe federal filing fee is $79 for the 2025 filing season, although it’s just $23 with TaxSlayer. These prices apply only to basic returns and state returns are usually extra.

Important

Many taxpayers consider how much tax season will cost them. This is another issue that can vary based on several factors.

Can You File for Free?

The federal government is aware that parting with much-needed money to pay for tax preparation can be a considerable burden for some taxpayers. It provides a few helpful programs.

You can prepare and file your tax return online for free with IRS Direct File but it’s only available in 25 participating states and the program is limited to basic Form 1040 returns.

IRS Free File is available in all 50 states and the District of Columbia and it can handle more complicated returns but your adjusted gross income must be $84,000 or less to qualify for this software from IRS partner companies.

The IRS provides other free services, too, but you must qualify for these as well. Volunteer Income Tax Assistance (VITA) is available to those with incomes of $67,000 or less per year, who have a disability, or who need language support. Tax Counseling for the Elderly is available to taxpayers who are age 60 or over.

If Something Goes Wrong

“To go on your own except for the simplest of returns could end up costing you more money and aggravation,” Camp says. “Particularly if you have to hire someone to fix an error on your return or represent you in an audit. I personally have amended many tax returns done by these outlets.”

The IRS provides services for these kinds of emergencies through Taxpayer Assistance Centers, however, you must call ahead and make an appointment. Many centers offer extended hours from Jan. 21 through May 1, 2025. You’ll need two forms of ID as well and one must be a government-issued photo ID. Note the level of support may not match what you’d receive from a CPA.

The Bottom Line

When deciding whether to file on your own or use a CPA, consider the complexity of your taxes. Tax software is affordable and sufficient for simple returns, but if you have multiple income sources or deductions, a CPA might be the safer option.

“You’ll have someone who is familiar with your return and who will defend it and you if you receive notices of adjustments or an audit notice,” Camp says. “Any deductions that are taken may have some risk associated with them depending on the type of return you have. One of the functions of the CPA is to advise the client of these issues.”