Starting to get those tax documents in the mail? I know that I am and the time has come to get my corporate returns ready for March 15 and the personal ones for April 15. If you are new to starting a business, then you might have had a personal accountant do it but if it is not complex you might have done them on your own. Now that you have a business, things get alot more complex and you will need help. There are different kinds of people that can help you and the biggest difference is between the tax accountant and tax preparer. When I was in college getting my accounting degree I interned for two tax seasons with an accounting firm and also got my certification with H&R Block so I could make money during college. So I can tell you from being both roles there are some differences. There will be a good fit if you know what to ask and what to look for to find a match.
Tax Preparers
On About.com they make a good explanation of tax preparers “Retail tax franchises such as H&R Block, Jackson Hewitt, and Liberty Tax Service offer competent tax service for individuals who need to file relatively straight-forward tax returns. Some tax preparers will be more experienced than others, and you can sometimes find CPAs and Enrolled Agents working in these offices. Prices are often determined by how many tax forms need to be filled out. Here’s a tip: ask if you can meet with a CPA, enrolled agent, or senior tax preparer. You’ll pay the same, but you’ll get to speak with a seasoned professional.”
Tax Accountants
These are more seasoned professionals and if you are in need of an accountant on a year round basis, you will probably go this route. I have a CPA that I pay on a quarterly basis to review my books, help with tax and retirement planning and generally keep me from making stupid decisions. I might have a background doing this but it is not my day job and I am a firm believer in paying the professionals to be professionals so you can focus on your business and the reasons you became an entrepreneur in the first place. There are two major tax accountants, the first is the CPA which I mentioned and the second is a tax accountant who is also an attorney. This is more specialized but it is important to know the difference and when you might need them.
- Certified Public Accountants (CPAs) are accountants who have passed the rigorous CPA Exam and are licensed by the state they work in. CPAs will specialize in a specific area, such as audits, tax, or business consulting. CPAs are best at complex accounting work, and not all CPAs handle tax issues.
- Tax attorneys are lawyers who have chosen to specialize in tax law. Often, tax attorneys will have a master of laws degree in taxation (LL.M.) in addition to the required juris doctor (J.D.) degree. Attorneys are best at complex legal matters, such as preparing estate tax returns or taking your case before the US Tax Court.
Which one do you use? What have been your experiences?
Have you used one of these two types in the past? What have been your experiences? What would you recommend for fellow entrepreneurs? Leave a comment.
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