Looks like I made some mistakes on my tax return

It’s the week of the Financial Blogger Conference and I’m very excited to meet all my fellow personal finance bloggers. I should have some great content to share with all of you in the weeks following the conference. In the mean time I wanted to talk a little bit about a situation I found myself in recently that may require me to break into my piggy bank.

I received a letter from the IRS about 3 weeks back. The moment I saw a letter from the IRS I wasn’t feeling too good. Receiving a letter from them this far away from tax season can’t be a good sign right? Sure enough it wasn’t. They claimed I had made some mistakes on my tax return and owed about $1,200 dollars in taxes.

Ouch.

Not exactly having $1,200 set aside for tax payments, I figured I’d better figure things out before ponying up the money. Luckily I paid for audit defense when I filed that year (this is for the 2009 tax year — they’re a bit behind I guess), so I called up the audit defense company and sent them the documents they requested (W2’s, the letter from the IRS, etc.).

With any luck we’ll get that $1,200 down to a more reasonable amount, but just in case I’m writing off the money now. Plan for the worst and hope for the best. I try my best to live by that saying. Nevertheless the audit defense company should have everything filed with the IRS before the end of the week, so hopefully I’ll find out soon what the damage will really be (the IRS is trying to charge me taxes on a private scholarship I received).

I’ve been using Turbo Tax Online to file my taxes for the past several years, but after this event I’m considering hiring an accountant to do it for me. If I’d have filed correctly in the first place I wouldn’t have to deal with this (and possibly have to pay interest on the unpaid tax amount). So my question to all of you is this, do you do your own taxes or do you pay an accountant to do them for you (and why)?