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The Right CPA for You and Your Business

Mature financial agent in meeting sitting with young couple. Happy consultant talking with couple about their savings plan. Insurance advisor in a meeting with man and woman.

It is critical for businesses to have the right strategic partners around it for lasting success. A key part of the network every business needs is an effective, trusted CPA to manage tax and other compliance aspects. The world of tax is very complex, and evolves far more often than people realize. Couple that with an evolving business, and the alignment of a business with its tax professional is essential. We have business owners tell us quite often things like, “I’m not totally happy with my outside CPA”, “I’m not sure how to leverage them” or “I’m not sure how to make the relationship work better.” It is a vital ally to have, so how do you get it right? Be educated, be engaged and be selective.

What to Expect

An essential part of the relationship with a tax professional is that they are proactive. If you are not doing any proactive tax planning before the year ends, or getting tons of questions about the past year right before filing day, you likely have the wrong team. Conversations should be frequent throughout the year, both forward looking and past. At times you should have your own agenda, at times they should have theirs. They should be asking questions about where the business is and where it is going and bringing ideas to the forefront. You may suddenly be eligible for tax deferrals or credits that were not relevant in the past. And on the flip side, you need to do your best to keep them informed of big changes in the business. They need that context. You should get to know them, and they should get to know you. There should be no big surprises in either direction. And in the long run, it will save you time and money, so do not worry about paying for that extra couple hours of meetings, with the right fit, the ROI is many times over. This iterative conversational component is a mutual commitment and what you should insist on and nothing less.

Match Up Expertise

There are tons of tax professionals that have wide bases of experience. There is nothing wrong with that. You do want someone who is comfortable and competent with business you are in, its size and the geographies in which you operate and the tax considerations accordingly, of not just today, but tomorrow. The needs evolve over time. We have often seen the classic case where what got you to point A is not what will get you to point B. Tax is no exception. Ask questions of your current CPA and who their clients are today. Do the same if interviewing new ones. A client of ours materially grew a B2C arm, only to find out their tax firm was not skilled in sales tax. That is a problem. We recently had a horror story with a technology company that has developed patents and made huge investments over the years that had not only not taken advantage of, but not even aware of tax benefits around research and development. Given that CEO’s business, I have no idea how that was never a topic of conversation. Don’t assume they can handle it all. Ask, and ask tough questions. Make sure the capabilities are there. This is not a one-size fits all.

Match Up Fit

This is a key partner. Do they align culturally with you? Do you communicate well with each other? Do you feel they understand you and vice versa? This is often overlooked, but no less important. Can you be vulnerable with them? Much of the time, the same CPA will handle both personal and business tax matters, and even if that is not the case, there is still crossover. Can you share worries and excites you and not hold back? They also need to fit with your team of strategic partners. They need to communicate with your financial planner, your legal advisors, lenders and other external stakeholders. If they don’t “fit”, their effectiveness will be limited. You cannot afford that.

Finding the right CPA has certainly become harder, with firms merging and longtime CPAs retiring. With the right expectations and commitments, the right CPA for your business is within your reach, and could be the one you already have, with just a simple reset conversation needed. Some of this may seem like such common sense. I can speak from experience with the tax mistakes we saw in the past tax year, that many businesses do not follow this approach, and leave themselves exposed to unexpected costs, anxiety and frustration. That does not have to be you. Be diligent and make sure you have a tax CPA in your corner that is there for you today and tomorrow.