Are you looking for a CPA that can handle your finances and do your taxes? Do you have a tax debt situation that needs handled immediately?
If you’ve felt frustrated with the CPAs that you hired previously and now want to ensure that you hire the best CPA possible to do your taxes, pay close attention here.
A CPA is a person that's not only capable of doing your taxes but can also advice you on your financials and help turn your financials around.
The right CPA can make a massive difference to your financial life. He will not only help you save on your taxes and file them but will also advice you on investments that you can make to gain increased returns and achieve your financial goals faster.
Here are two critical things you need to know before you go out looking for a CPA...
1. Define your purpose
Clearly define your purpose for hiring a CPA. Are you looking for a CPA that can help solve your current tax debt situation you have? Or are you interested in a CPA that can help plan your investments so you can save on taxes in the following years? Or are you interested in a CPA to help you gain maximal interest from your investments?
Just like how lawyers are specialized, accountants also have their own specializations (although they don't have a formal qualification or a name attached to define their specialization). There are some CPAs that are tax resolution specialists.
These CPAs work with people that have a serious tax debt situation with IRS penalties. They plead their client's case with the IRS and help reach a compromise.
Similarly, there are CPA's who are financial planners (that help manage your investments), SME auditors (that help you audit and file returns for your small business) and so on.
Take a piece of paper and write down the purpose as to why you need a CPA. Define it in just one line and then you can start searching for an effective CPA that can help you with your financial situation.
2. Reach out to people you know
The classifieds isn't the only place to ask for a CPA. Make sure that you ask for word of mouth referrals within your network. Social networking websites have made this easier.
Contact people you know who are in the financial field and ask them to recommend you a good CPA that can handle your unique financial problem. You can also Google them or call up Yellow Pages to find a service.
If you ask for a generic CPA, you'll find a generic CPA. The generic CPA will have little knowledge about the specifics of each financial law and won't really be able to assist you.
He may be able to file your taxes but he won't be well-versed with the latest tax laws. This will prevent you from claiming any deductions that you can make by taking advantage of the laws (tax avoidance strategies).
Now you'll find yourself with a bunch of phone numbers of different CPA's. Some CPA's may actually be reaching out to you already. How do you choose the best one from them? Well... read on.
Here's how to choose the best CPA from all the options that you have...
1. Speaks to your PERSONAL Problem
An excellent CPA does not advertise his pitch blatantly. He listens to your problem and does not offer generic advice or make a generic pitch. Rather, he specifically addresses your problem and talks to you. Poor CPAs make blatant claims and just talk. The best CPAs listen. This is the raw truth in any industry or line of work.
The best people in any industry are those who listen and speak uniquely to your situation. Call up the CPA and tell him about your problem.
How does he respond? Does he make a generic recommendation or a personalized suggestion? You can figure out who's the best with just this test.
2. Well-versed with the latest law amendments
Financial laws change from time to time. This is especially important when you're looking to save on your taxes. Make sure the CPA is an aggressive individual that's well-aware of the latest tax laws.
Some of the tax avoidance strategies that were allowed a couple of years ago are no longer allowed and are classified as a method of purposeful tax evasion. You can actually go to jail for that. It is very crucial that your CPA is aware of the latest amendments.
We recommend that you pose some genuine questions in regard to the new laws and see if the CPA is aware of them. If he's not, you're probably dealing with a stubborn CPA who thinks that education is over once he completed school.
Any profession requires you to constantly educate yourself and innovate yourself. Good CPAs are aware of this fact and constantly educate themselves with the latest laws to help their clients in better ways.
How many years of experience does the CPA have (if he's freelancing)? If the CPA is just a beginner working at an organization, you don't have much to worry about because the organization's experienced staff will always double check on the soundness of the junior CPA's strategies. Make sure that you work with a CPA that has at least over 3 years experience.
But here's the thing - Do not say no to beginner CPA's directly. There are some desperate beginner CPA's that are looking to prove themselves. They just need a client. Be on the lookout for CPAs who are willing to offer you services to try for free for a month before you become a permanent customer.
4. References and testimonials
And lastly... do not forget to ask your potential CPA for references and testimonials. This is essential and it's the only way you can determine his/her legitimacy. Get in touch with the previous clients of the CPA and ask them your opinion.
You can easily reach out to them via social networking websites. If you’re dealing with a good CPA, he will have already presented you with references and testimonials to destroy your objections.