| Certified Public Accountants (CPAs) do small | | | | Certified Public Accountant (CPA) may be more |
| business tax returns. But sometimes bookkeepers | | | | adept to provide sound tax advice and future tax |
| prepare tax returns as well. For your company | | | | savings than the bookkeeper. Again, if your return |
| tax preparation, should you use a bookkeeper or | | | | is more complicated, CPA tax preparation is more |
| a certified public accountant? | | | | vital. A Certified Public Accountant can do to |
| Many would look at cost first. The Certified Public | | | | reduce your tax obligations if you own a small |
| Accountant will probably have a greater hourly | | | | business. If you are an employee with no |
| charge than a bookkeeper. The Certified Public | | | | deductions, a Certified Public Accountant is not |
| Accountant may be fast. However, the entire fee | | | | required for your tax preparation. |
| will probably be more with a Certified Public | | | | A specific case may illustrate. I completed a tax |
| Accountant (CPA). Use a bookkeeper then? Not | | | | return for a client. As part of my service, I |
| so fast. There is more at stake than the tax | | | | reviewed prior returns which were prepared by a |
| preparation fee. The CPA may be more equipped | | | | different tax preparer. One return had a |
| to find all possible tax deductions. Especially if you | | | | substantial net operating loss (NOL). The NOL |
| have a more involved tax return. If your only | | | | occurred in a tax year where taxpayers were |
| income is as an employee and you have no | | | | allowed a NOL carryback of five years. Though |
| possible deductions, a bookkeeper, or some other | | | | the return was technically correct, the importance |
| low cost alternative may be the best choice. | | | | of the NOL was not conveyed to the taxpayer. |
| This does not mean your tax will definitely be less. | | | | Prior to the statute of limitations expiration, I |
| You could owe more if the tax return is prepared | | | | prepared amended returns to utilize the NOL, |
| by a Certified Public Accountant. The Certified | | | | resulting in a large refund from a couple returns, |
| Public Accountant may be mindful of limitations on | | | | four and five years earlier. The taxpayer received |
| deductions unknown to the bookkeeper. The | | | | a refund of over $44,000. |
| bookkeeper may include the deduction, resulting in | | | | It may be helpful to consider your tax preparation |
| lower initial tax. An audit, tax penalties, and | | | | fee similar to fee you pay for other insurance. It |
| interest may follow as a result. All your tax | | | | is improbable that you home will suffer a great |
| preparation fee savings, and significantly more | | | | casualty loss (e.g. fire) next year. Appropriate |
| could be gone. | | | | insurance could result in a substantial savings if |
| So far, we have discussed the actual return | | | | there was a fire. If there is no fire, you still have |
| prepared only. Certified Public Accountant tax | | | | piece of mind through this insurance. Likewise, you |
| preparation could result in future tax savings, | | | | probably will not receive an additional refund of |
| versus bookkeeper tax preparation. By completing | | | | $44,000 just because you hired a CPA. The small |
| your tax return, the Certified Public Accountant | | | | additional fee, however, is your best protection |
| (or bookkeeper), will become familiar with your | | | | from making a large error on your return. Thus, |
| small business. | | | | there is more piece of mind. |
| With this knowledge of your finances, the | | | | |