It’s March, you are busy in your first year of business and the last thing on your mind is finding a tax accountant. But, alas, Uncle Sam is creeping in; it’s time to buckle down and hire someone to run your numbers, help you organize your expenses/receipts/deductions and hopefully find a way to make you money this tax season.
Instead of just looking up a certified public accountant in the Yellow Pages, take note of these suggestions on how to find the best person to handle your taxes.
Finding the perfect accountant
There are two ways to locate a great accountant: through referrals and through networking.
“Referrals are the best way, in my opinion,” says Clint A. Costa, CPA and attorney at Chicago-based law firm Shaheen, Novoselsky, Staat & Filipowski. “Talk to business owners who have similar businesses and make sure the person you are hiring has experience with your form or entity and your industry.”
Don’t have contacts in your industry? Drive over to the local Chamber of Commerce and introduce yourself; you are bound to meet dozens of qualified accountants. As Costa explains, accountants generally do not spend a lot of money on marketing, but do often invest in Chamber memberships.
Costa also suggests contacting the American Institute of CPAs, which has branches in every state and listings of specialists in a variety of industry groups.
Questions to ask when interviewing candidates
Consider going through a similar process when hiring an accountant as you do when bringing on a staff member. As Bina Khan, managing partner of Summit Service & Associates, an accounting and consulting practice in Armonk, N.Y., explains, it’s important to interview three or four candidates before making a decision.
“Accountants aren’t just for taxes; they can help you in every financial decision of your business, so it pays to spend time on the outset,” she says. “Make sure you get a free consultation with each one to see what you are dealing with.”
Khan offers a few questions to ask in the interview process.
1. How are you different from a Tax Preparer?
Tax Preparers are persons hired to come in at tax time, get a business owner the largest possible return and then leave. According to Khan, this isn’t always the best person for the job.
“You want an adviser, someone who can look at every angle of your business and give you strategic advice,” she says. “Look for a tax accountant that does advisory work—that is where you will get more value-add out of the relationship.”
2. What experience do you have in my industry?
Not all accountants are created equal. Some are specialists in real estate, others in hedge funds, others in consumer packaged goods, and so on. Before signing a contract, Khan suggests asking for referrals of business owners in your industry who’ve previously hired the professional.
3. Do you perform the work personally?
Often in large accounting practices, the firm’s owner (or a high-ranking partner) will bring in the business only to pawn it off on a low-level staff member. The result: The client (i.e. small-business owner) is stuck talking to someone who can’t make decisions and may leave the firm to pursue a better opportunity. Khan recommends entrepreneurs stick with small accounting firms for this reason.
“It is really important to have a relationship with the partner or owner of the firm; their advice can be much better than the advice you’d get from a junior member,” she says.
If you end up without a choice, inquire into the review process of your financials. Who looks at the work before it comes back to you? Is it reviewed by a partner or owner before signing off or does an entry-level employee manage the entire process?
4. What added value can you bring to the table?
During the interview process, ask the candidate what services they can provide outside of tax season, Khan suggests. Can they come in on a quarterly basis to go over your financials? Can they examine your sales and provide forecasting and planning expertise? Keeping in frequent contact with your accountant can help make tax season far less painful and save you cash in the process.
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Katie Morell is an independent business writer and editor, who over the past 10 years has covered topics ranging from business and politics to travel and social justice. Her work has appeared in a variety of regional and national publications, and she has served as an editor for Meetings Media.
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