How to Find a Tax Accountant Who Protects Both Your Wallet and Your Business
If you are new to our weekly entrepreneur newsletter, I want to first extend a warm welcome! Each week, we research the issues that are currently impacting small business owners and entrepreneurs the most, and provide our insight, strategies, and expertise to help you solve the challenges you face and succeed in achieving your personal and professional goals. With tax deadlines coming up, we wanted to take some time to provide some tips for getting the most value from your relationship with your tax accountant. We hope you enjoy the content!
In This Issue:
- Common Pitfalls of Bad Tax Accountants
- Why Specialization Matters for Effective Tax Planning
- Balancing Tax Savings with Healthy Cash Flow
- Where to Turn for Help and Advisory Support
How to Find a Tax Accountant Who Protects Both Your Wallet and Your Business
Not too long ago, a business owner asked their tax accountant how to reduce their tax bill before year-end. The advice? Spend thousands of dollars on equipment and supplies—items the owner didn’t truly need. Sure, it shaved a bit off their tax liability, but it also left them strapped for cash when they needed it most. This scenario captures a fundamental problem with many tax professionals: focusing so heavily on short-term tax savings, they miss the bigger picture of maintaining a healthy, profitable business.
Common Pitfalls in Tax Accounting
- Barely responsive, often only available once a year.
- Charging by the minute, without considering revenue or complexity.
- Failing to offer genuine guidance beyond plugging numbers into tax software.
- Overemphasizing quick tax reductions—like pushing unnecessary expenses—at the expense of long-term financial stability.
- In the worst cases, an under-qualified accountant might even risk filing inaccurate returns, opening you up to scrutiny or penalties if you’re ever audited.
Why Specialization Matters
Some CPA’s try to handle both tax filing and day-to-day bookkeeping, which can dilute their expertise. They end up spending so much time on basic data entry that they have little bandwidth left to explore advanced tax strategies. Look for a tax accountant who focuses on tax law and strategy so they can devote their energy to where they provide the most value: strategic tax planning and saving you money. When an accountant specializes, they often have a deeper grasp of industry-specific regulations and creative, yet legally compliant, tactics to reduce liabilities.
Balancing Tax Savings with Healthy Cash Flow
A good tax accountant recognizes that while saving on taxes is important, it shouldn’t come at the expense of your business’s cash flow and growth. Buying unnecessary equipment for a $20,000 tax write-off might save you $5,000 on your return, but it still depletes $15,000 of your working capital—a decision that can cause financial strain later on. Ideally, your CPA should understand your long-term vision, personal goals, and immediate business needs, crafting tax strategies that improve profitability without depleting cash reserves.
Where We Can Help
While we don’t file taxes at our firm, we can still help you! If you’re not sure how to find a reliable, responsive tax accountant, we can make referrals to professionals we have used and trust. Alternatively, we can help you vet any accountants you’re already considering. We know the right questions to ask, how to recognize tax accountants that will really work in your best interest, and we speak their language.
Plus, our own bookkeeping and advisory services are available to ensure you have clean, up-to-date financials ready to hand over—reducing the time (and fees) a tax accountant spends piecing together your numbers. The bonus? With real-time, accurate financial data, you can make smarter decisions year-round instead of waiting until tax season to see how you did.
Click here to schedule a free strategy session now!
See you next week!
