Tax Consulting: 10 Tips for Hiring Licensed CPAs to File Your Taxes: The average person will pay $189 to prepare their taxes. This is a relatively lower charge, since you’ll save a lot of time and money.
Licensed CPAs are people who have the right accreditation to provide tax services in a specific area. These experts can plan and prepare taxes for individuals and businesses. In addition, they can offer financial advice and do estate planning.
But how do you get the best CPA? Here is a guide that you should follow when hiring a CPA consultant.
1. Experience
Getting a CPA who has experience with a particular area of expertise is a good idea. For instance, real estate agents should look for CPAs with property experience.
A CPA with the right experience will understand the unique problems of your business. They’ll also have dealt with your particular type of business and can suggest tax-saving strategies. Moreover, such a CPA will know the latest tax laws relating to your industry.
Therefore, the potential CPA experts should send you a list of their previous jobs. You’ll first look at the number of contracts that they’ve done in the past. Tax experts who complete hundreds of tax preparation documents every year have the right experience.
It’d be best if you also looked at how many of those completed jobs concerned your industry. In general, the majority of their completed work should have been for clients in your industry.
2. Determine Your Needs
Every business has unique cash flows, revenues, and wages. It’s crucial to determine the type and scope of your accounting needs before you choose a CPA. This ensures that the CPA knows what they’re supposed to do, and you can easily monitor their progress.
The first task is to create a list of all the actions that the CPA must complete. These tasks should be listed in terms of priority, so that you can choose a CPA who can do the most important things for you. You can then create questions for each task and see if the potential CPA can provide the correct response.
Most business leaders think that their revenue plays the most important role in accounting needs. This may be true for some businesses, but it’s usually not the case. For instance, art galleries may sell five paintings in a month, but each of them will be valued at millions of dollars.
So the art gallery will have revenue, but it won’t require many accountants. Consequently, the size of your inventory and the type of products or services will determine your accounting needs.
3. Choose Full-time or Part-time Accountant
Your business may require a part-time or full-time accountant, depending on your workload. Generally, most companies hire part-time accountants during the tax season. That’s because it’s cheaper to employ part-time CPAs.
Part-time CPAs are cheaper because they’ll charge an hourly rate instead of monthly wages. Once they finish the job, you’ll terminate the contract. You’ll only require them again when you need accounting services.
4. Look for Red Flags
CPAs who give unrealistic promises from the beginning are not qualified. A person should only make suggestions once they have analyzed your company’s financial situation. Similarly, people who promise astronomical deductions and tax benefits don’t have the right skills.
In addition, somebody who fails to provide their tax identification number may be a fraud. That’s because the IRS doesn’t recognize the CPA. If you feel uncomfortable working with somebody, terminate the contract immediately.
5. Non-Accounting Qualifications
Accounting isn’t just about crunching numbers. It’s also a job that requires personal skills and communication abilities. You need somebody who can explain the accounting process in simple terms.
Therefore, the ideal accountant must have other qualifications. Good communication skills are the hallmark of a great CPA. They should respond quickly to your phone calls and emails.
The CPA will have to interact with most of your employees to get the right data. If they have good communication skills, they will interact very well with everybody. Bombastic and arrogant CPAs may not offer the best tax help.
In addition, CPAs need to have other skill sets, such as patience and honesty. Somebody who is always asking tricky questions and is impatient will frustrate workers. You can determine these skills when you are interviewing an accountant.
6. Interview Candidates
You’ll need to talk to different tax preparers to know a qualified one. Hiring a tax preparer during the tax season can be difficult because they’ll be busy. The option is to call them and request an interview of about 15 to 20 minutes.
If somebody is too busy to grant you an interview of a few minutes, then they won’t have enough time to work on your taxes. Therefore, it would be best if you had somebody who could listen to your ideas and requests. Here are some things that you will ask if you are granted an interview with the tax accountant.
● When did you start doing accounting work?
You’ll need to ask this question because you want somebody who has several years of experience.
● Can you produce any credentials?
Any person can put a sign on their office or website and claim to be doing tax consultation work. It’d help if you had somebody who could produce a series of accreditations. For instance, they should be certified public accountants and show that they can do accredited tax advisory work.
You can check your state’s licensing board and professional bodies to see if the tax accountant’s name appears in their records. If it doesn’t, you should report them to the relevant authorities.
● Do you specialize in any of the accounting disciplines?
Your business may have specific requirements which can only be handled by a specialist. For instance, you may have a restaurant that requires particular tax needs. On the other hand, you may need a person conversant with real estate tax codes if you are a realtor.
7. Look for CPA Licenses
The ideal CPA expert, such as www.taxfyle.com/tax-preparation-outsourcing, should have accreditation from the relevant authorities. They should be licensed and accredited to do tax preparation work. In addition, they must have successfully done the Annual Tax Filing Season course.
These are some tax consulting jobs that need ongoing education and varying study time. You can check on the IRS website to see if somebody has completed these programs. The tax preparer will have provided a PTIN that you can verify on the IRS database.
8. Membership of Professional Bodies
Qualified tax experts should be members of several professional bodies. The most common body is the AICPA (American Institute of Certified Public Accountants). Also, there are other accounting bodies at the state and regional levels.
A person who is a member of a professional body must observe ethical requirements. In addition, they must maintain a high level of professional conduct. They must also have not received complaints from their previous clients.
A person who isn’t a member of a professional body may not display the required level of expertise or professional conduct.
9. Pricing
You must also know the fees that the accountant will charge when they help with taxes. As indicated above, the average person spends $189 to receive tax preparation services from a CPA. Consequently, it’d help if you had somebody who doesn’t charge too much money.
In most cases, the tax preparation expert will charge based on the hourly rate. However, they may also have a flat fee if your workload is light.
The fees will increase with the complexity of the job. If you have several departments and an extended inventory, you’ll probably pay more. It’d help if you avoided anybody who tries to base their fees on your average revenue.
10. On-boarding Your CPA
Your final task is to introduce the CPA to your business. You can give them a tour of what you do and access to documents. If this is somebody you’ve worked with before, there won’t be a lot of onboarding steps.
You should also provide the guidelines that they should be using. There should be a way to determine whether the accountant is doing their work correctly and quickly. The hired accountants should know the milestones before they start their work.
You should also know how you’ll receive reports and updates from the accountant, especially if they’re working remotely.
Get an Edge by Hiring Licensed CPAs to File Your Taxes
Licensed CPAs will prepare your taxes and maintain financial statements. You need to hire somebody who has the right qualifications and experience to do the job. You can use the tips that we have provided above to get started.
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