Top 4 Reasons People Look for a CPA

The deadline to file your taxes is fast approaching, and you might be thinking that this year you should work with a CPA instead of filing on your own. Maybe you worry that you’re missing important details or potential write-offs. Maybe you’ve had a change in personal or business finances and your taxes are getting too complicated. Or maybe you just want help from someone you trust so you don’t have to deal with the stress.

So how do you decide if hiring a CPA is the right move this year? 

Here are 4 common situations where you’d benefit from working with a CPA.

1. You’re spending too much time on taxes

How much is your time worth? 

Try to estimate how much an hour of your time is worth, then think back to how many hours you spent preparing your taxes last year. This will give you a good sense of how much it actually “cost” you to file your taxes. Now you can make a more informed decision about whether it’s worth it to partner with a professional on your tax prep and filing. 

This is particularly applicable if you’re self-employed or own a small business. Your time might be better spent on business development, building relationships, or billable hours. 

2. You’re worried that you’re not getting it right

Tax laws are complex and they change frequently. This makes it challenging to keep up with them on your own. 

There are two sides to this scenario:

• You worry about getting audited
• You worry that you’re missing deductions and paying more taxes than you need to

Either way, it might be wise to work with a CPA. 

A CPA can organize and prepare your taxes to minimize your audit risk. This isn’t a guarantee that you won’t get audited, but you’ll be better prepared if you do.

Also, a CPA will make sure you take advantage of all the tax benefits, credits, and deductions available to you. You might even learn about changes you can make for the next year to put yourself in a better tax situation.

3. Taxes cause household tension

Filing taxes can be a stressful and complicated undertaking. Finances can cause a lot of tension in a relationship. And if you’re married, filing joint taxes can exacerbate this tension. 

You and your spouse might decide it’s worth the investment to work with a CPA who can guide you through the process and help you get a clear picture of your financial and tax situation. By learning about your tax situation, exploring your financial options with an expert, and becoming more comfortable with your finances, you can improve your financial conversations, plan better for the future, and reduce financial tension.

4. Your tax situation has become more complex

There are many things that can impact your tax situation and make it more complex from year to year. Purchasing a home or rental property, starting a business, a change in your employment, or inheritances can all have significant effects on your taxes. 

These major life changes can make filing your taxes more challenging, especially when the changes are new and you’re still adjusting to the impact they have on your finances and taxes. 

Complex tax returns usually involve one of these situations: 

• Rental income and expenses
• Self-employment income and expenses
• Income from multiple states
• Real estate purchase or changes
• Estate and trust considerations

In these scenarios, partnering with a CPA can help you explore all possible deductions and tax credits, ensure that you’re not missing any important details, and offer confidence that you’re correctly filing your taxes. 

20 Questions to Ask When Hiring a CPA

When individuals and businesses decide to hire a Certified Public Accountant it is a good idea to shop around. After all we are talking tax preparation and wealth creation, two very important aspects of a healthy financial present and future. So when choosing a CPA it is advisable to question your candidates to determine if their services will work for you. Here are 20 important questions to consider when hiring a CPA.

#1 Based on my last tax return, am I paying too much too little or the correct amount? Most business owners pay more in taxes then their actually liability. 

#2 What services do you offer other then tax preparation?

#3 Do you receive annual professional education? The tax code changes annually and correct interpretations of new law are vital to proper tax preparation and wealth management. 

#4 How long have you been a Certified Public Accountant? 

#5 How timely is your service? Tax information can become out of date very quickly. With the exception of annual information tax data should be updated at least every thirty days.

#6 How quickly can you respond to questions? A good CPA will return phone calls and emails within 48 hours.

#7 Are you available year round? Many tax preparers work seasonally and may close their offices for several months a year.

#8 What are your hours of operation? It is important to be able to call your CPA during hours that are convenient for you.

#9 Will you be the only person I work with or will others be meeting with me? It is best to build a relationship with one advisor.

#10 Will my accounts and computer be serviced by my primary advisor or will Jr. staff be involved.

#11 How can you help me make more money? A proficient CPA will have reviewed your financial information and have suggestions on how to improve your financial future.

#12 Are you tech-savvy? Accounting software is only as good as the person who installs and runs the application. A good CPA will help you set up your books and instruct you on how to input data, and then review the data for accuracy. 

#13 How have you integrated computers, internet and technology in general to your practice? Has it helped reduce fees and increase service to your clients?

#14 What professional organizations are you a member of?

#15 Are you a member in good standing with the state's CPA governing board. Before hiring any financial partner check to make sure they don't have any complaints or actions against them. 

#16 Who are your other clients? It is important to know your CPA has experience dealing with your type of business.

#17 Do you have any conflicts of interest? If a CPA represents your competition there should be measures in place to deal with any conflicts.

#18 How do you calculate fees? You want to avoid surprises and any disagreements about how and for what you are billed.

#19 How can I help you service my account and keep fees to a minimum?

#20 Why should I partner with you and your firm? A good CPA will not only demonstrate proficient understanding of your finances but also be invested in your continued success.

Choosing a CPA can be daunting especially if you are not well versed in accounting jargon.  A good CPA will make an effort to personalize the process and provide clear easy to understand advice. Tom Bulger, CPA has been helping individuals and businesses thrive for over 25 years. Contact Tom Bulger and find out how he can help you grow and protect your assets.

Did we miss any important questions to ask when hiring a CPA? We appreciate your comments and suggestions below.