3 Questions to Ask When Working With an Accountant 2020
Instead of investing the services of a qualified skilled accountant, relying solely on free or inexpensive online small business accounting software can be a costly mistake that entrepreneurs make all too often. Don't just be one of these. Springing can be worth any extra penny you pay on a licensed accountant, says ff Venture Capital Chief Financial Officer Alex Katz. A trained, certified public accountant (CPA) will tip you off on potentially irreversible financial errors and brand new opportunities for tax savings that you do not know to exist. And we doubt that most automated barebones accounting solutions will bring these red flags to your notice just as effectively as an accountant. When you invest in a reliable accountant's services, it's important to know what to ask and when— not only to make sure that you get the benefit of your money, but also to make sure that he or she helps you do what's best for your company.
What’s the best way to contact you and how often should we be in touch? It may seem too easy a problem but the secret to a good, profitable relationship with your accountant is transparent, efficient and regular contact. Establish early on how often you will communicate, either in person, on the phone or online (via a Skype, Google Hangouts or Facetime video chat app). Decide together whether to meet on a weekly, monthly or bimonthly basis.
How can you help me prepare for (and survive) tax season? The number one reason small companies employ an accountant in the first place is mostly to untangle the time-sucking tedium of tax planning. You'll want to ask yours what tax credits you can receive and deductions. Also ask him or her whether you can take advantage of the new tax regulations to maximize write-offs. “Tax opportunities, such as the R&D credit, accelerated depreciation or panoply of state and local tax opportunities, including tax forgiveness and outright grants or refundable credits, can even be applied for as part of the tax return process,” Katz said. He recommends you get answers to all of your tax questions sometime before the filing deadline of April 15. To escape the year-end rush, include your accountant in helping you gather all of the necessary accounting documents and data during the year.
What are some considerations I should consult with you about on an ongoing basis? A professional accountant can get to know you and your company well enough to keep you constantly aware of— and to respond quickly and correctly— a variety of factors that could affect your bottom line, for better or worse.Your accountant should be well-versed in several disciplines, “including but not limited to GAAP [generally accepted accounting principles], corporate and individual tax, retirement planning and financial planning," Katz says. He or she will also be open to helping you consider the financial implications of such decisions, such as recruiting an independent contractor or a full-time employee, purchasing or renting an office building, or owning or leasing a company car and much more. The accountant will also work with you in such a way that you can clearly consider and appreciate what steps you need to take now and in the future, preferably without the normal complicated accounting jargon. “If an entrepreneur is unable to develop that type of relationship with her accountant, it may be time to look for a new one,” Katz warns.
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