Finding a Great Accountant for Your Small Business
If you’re not a bean-counter by nature, then handling the accounting tasks for your small business is probably a giant headache. I’m not a bean-counter either, and my impulse is to find a number-cruncher, and throw all my paperwork to that person as fast as possible.
Not a good idea.
Did you know that the U.S. Tax Code contains over 18,000 pages? And the government keeps adding more pages, addendums, and memorandums to that code every year. Yikes! What does this mean to you as a small business owner?
You need a fabulous accountant.
Actually, you need more than a fabulous accountant. You need an accountant who specializes in your area of small business. If you run a manufacturing operation, you need a specialist who understands how to maximize the tax deductions for manufacturers. If your small business is farming or livestock, you need someone who knows all about IRS Publication 225. I have a couple of businesses, MLM and consulting, so I need an accountant who has the low-down on how to maximize my home-based tax deductions.
Finding a Great Small Business Accountant
To find the perfect accountant for your business, don’t flip through the yellow pages. You’ll just drown in the massive listings there. Instead, follow these three simple steps.
Step 1: Get Referrals
Dig through your network of business acquaintances and ask for referrals from people whom know you well, and who are familiar with your business. You might check with your attorney, your banker, your real estate agent, and your insurance agent. You can also get recommendations from people who own small businesses similar to yours.
Step 2: Conduct Interviews
Remember, your accountant can literally hold your financial future in his or her hands. Don’t be tempted to hand over your bank records to the first recommended accountant. Do your homework first. Be sure the accountant specializes in small business, and has a thorough knowledge of your industry. In addition, find out whether the accountant is more of a paper-pusher (filling out the right forms and sending them in on time) or more of a tax advisor. You’ll want to choose an accountant who matches you goals. If you are willing to do quite a bit of financial research yourself, you won’t need a tax advisor. If you want to focus more on other parts of your business, then you’ll need an accountant who can more actively advise you.
Step 3: Negotiate an Agreement
Most accountants work on an hourly basis when handling normal tax questions or filing simple forms. When it comes to filing federal tax returns, some accountants work hourly while others charge by the page. Find out how your chosen accountant charges for his or her time, and get the deal in writing before proceeding forward. Most accountants, being excellent administrators, will have an agreement already drawn up. If you agree with the terms, all you have to do is sign. If you don’t agree with all the terms, try to negotiate a modified contract, or pick a different accountant. One final point: find out what the accountant charges should you need to defend your tax return to the IRS. Some accountants charge extra fees while others include this kind of work in your tax preparation fees.
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Photo credit: studying till the sun goes down
