It depends about your specific needs.

If you are a small business owner or entrepreneur, an accounting firm can help you focus on your core constituencies without worrying about financial minutia.  Unless you have a skilled accountant on board, you will likely save time and money by working with an accounting firm instead of wading through complex financial regulations and tax codes on your own.

The IRS gives a number of different guidelines for keeping financial information, and this information varies depending on whether you are an individual or a businesses

General rules for individuals

• Keep bank statements for 1 year
• Keep loan documents, credit card statements, and other contacts until fulfilled
• Keep annual investment statements until sold
• Keep tax records for 7 years from filing date
• Keep receipts for large purchases, real estate deeds, vehicle titles for as long as you own the property
• You can general discard expired warranties, pay stubs, and cancelled checks

General rules for small businesses and entrepreneurs

• The rule of thumb is to keep all items for at least 3 years
• If you have not yet paid taxes on income that you should report, keep documents for 6 years
• If you claim a credit or refund after you file a return, keep records for 3 years from the date you filed the return
• If you file a claim for securities or bad debt deduction, keep records for 7 years
• Keep all employment records for 4 years from the date that the tax is paid.

First, don’t panic!  Your required action will depend on the type of mistake you made.

• If you forgot to include a certain piece of information, it’s likely that the IRS will contact you to request the specific piece of information.
• If you made a mistake in your calculations, many small mathematical errors will be discovered as the IRS processes the return. It’s unlikely that you will have to correct errors of a small caliber.
• If you forgot to report some of your income or if you forgot to claim a credit or deduction, you will need to file an amended tax return using a 1040X Form. These forms can be found on the IRS website.

First of all, stay calm.  If you can’t pay the full amount due, you should still file your return and pay what you can by your deadline to avoid interest and penalties.  Then you should contact the IRS to discuss payment options.  In some cases, the IRS can offer a short-term extension to pay, an payment installation agreement, or waive your penalties.

Yes, there are three main types of accountants:

1. A financial accountant will gather financial data into financial statements. These statements will be used to organize all records required by internal and external stakeholders.

2. A management accountant will use a business’s financial information to aide managers with any business decisions such as expansion, change of direction, merging, collaborations etc.

3. A tax accountant  applies accounting methods that focus on taxes rather than the appearance of financial statements. Tax accounting is governed by the Internal Revenue Code which dictates the specific rules that companies and individuals must follow when preparing their tax returns.