Did you know that there are 664, 532 certified public accountants (CPAs) in the U.S.? Before entrusting your finances to the first CPA whose name comes up on a Google search, consider what makes a great CPA, from communication to services offered. Here’s a little inside scoop to help you prepare for tax season and find a CPA who will provide valuable services.
If you’re not having conversations with us, then we aren’t doing our job.
Do you just drop off tax documents at the local CPA office and receive the completed return—all without any personalized interaction with your accountant? Then, you might be getting ripped off. A CPA should give you actual face-time to confirm all the information on your return is accurate.
TurboTax has the same core engine that professional tax software does, making it simple for you to input numbers just like a CPA can. But identifying errors, finding missed deductions and planning for potential future issues are the areas in which we offer value. So in order to reap these benefits, make sure that we’re asking you questions and conducting a thorough analysis.
Some of the services we offer are significantly more valuable than others.
Our firm is fairly transparent about this, but some companies are not. In fact, CPA firms readily perform any service you’re willing to pay for. Case in point, I do everything for some clients, from receiving their mail and paying their bills to maintaining their books to planning their taxes and filing their returns. But some of these functions have a much greater impact than others.
For example, I refuse to even work with business clients unless they permit me to handle the tax return and agree to meet once a quarter at the minimum. This is regardless of what other tasks they ask of me. Having a professional manage your taxes is often worth the expense. However, other services a CPA might offer are definitely more optional.
You don’t need to hire us to handle every accounting function you might have.
This hinges on the previous point, but it’s generally not in your best financial interest to outsource all accounting needs to a professional. I view tax returns and planning or advisory services as essential. Payroll can have a significant margin of error too. Because of that, I recommend hiring a full-service payroll specialist rather than doing it themselves.
Still, there’s flexibility in other accounting tasks. For instance, client needs can make it impractical or cost-prohibitive for us to handle their bookkeeping, and we tell them so. In those cases, we find a lower-cost bookkeeper or help them train existing staff members to perform this role. But some CPAs are not inclined to lose business and won’t present this as an option.
If we advertise too many services, then we aren’t skilled at doing them.
Although it’s not inherently wrong to offer a diverse range of services, many CPA firms will attempt to generate extra income by broadening their focus too wide. In addition to accounting, they often sell insurance policies, establish LLCs and corporations, or promote investment brokerage.
Most CPAs are not legitimate financial advisors, insurance agents or lawyers though. By overextending their own bandwidth, they become incompetent and not just in these side ventures. In fact, many spread themselves so thin, they become subpar accountants too. So hire us primarily for tax purposes and find another expert for all your financial planning needs.
Does Your CPA Make the Cut?
The preparations for tax season can feel intimidating and overwhelming. A CPA’s job is to ease this burden, not complicate it further. The more you know going into the relationship, the better financial position you’ll be in overall. Now you know what questions to ask and what information to look for—so don’t be shy.
Micah Fraim, CPA owns an award-winning accounting practice, has an Amazon bestselling book, and experience as a business analyst in the marketing department of a Fortune 500 company. As such, he brings a broader perspective than most any other accountant. For years he’s helped my clients find money that others have missed and helped them make maneuvers others had not thought of. He’s been featured on Forbes, MarketWatch, Time and you can learn more about his work at FraimCPA.com.
