Working with an Accountant: What to Expect and What to Demand

Your Accountant Is Not Just a Tax Filer

Too many business owners treat their accountant like a vending machine. They dump a box of receipts in February, get a tax return in April, and ignore them the rest of the year. That is a waste of money and a missed opportunity.

A good accountant is a strategic advisor. They should be helping you save on taxes, structure your business properly, plan for growth, and avoid expensive mistakes. If they are not doing that, you are either not asking or you have the wrong accountant.

Types of Accounting Professionals

Bookkeeper

Handles day-to-day transaction recording, bank reconciliation, and basic reporting. Does not prepare tax returns or provide strategic advice. This is your data entry person.

Cost: $300 to $1,500/month depending on transaction volume.

Certified Public Accountant (CPA)

Licensed professional who can prepare tax returns, perform audits, and provide advisory services. A CPA has passed a rigorous exam and meets continuing education requirements.

Cost: $1,000 to $5,000+ per year for a small business, depending on complexity.

Enrolled Agent (EA)

Federally licensed tax professional. Can represent you before the IRS. Specialists in tax preparation and planning but generally do not perform audits.

Cost: Similar to CPAs for tax work, often slightly less.

Tax Preparer

Prepares tax returns but may not be licensed (CPAs and EAs are). Be cautious with unlicensed preparers for anything beyond simple returns.

What You Should Expect From Your Accountant

At Minimum (Tax Compliance)

• Accurate and timely tax return preparation
• Quarterly estimated tax calculations
• Year-end tax planning meeting
• Answers to your tax questions throughout the year
• Keeping you compliant with filing deadlines

What You Should Demand (Advisory)

• Proactive tax planning. They should be calling you in October or November to discuss year-end strategies, not waiting for you to ask.
• Entity structure advice. Should you be an S-Corp? When does it make sense to convert? They should tell you.
• Financial statement review. At least annually, they should review your financials and point out concerns.
• Retirement planning input. SEP IRA, Solo 401(k), SIMPLE IRA — which retirement plan maximizes your tax benefit?
• Responsiveness. If you email a question on Tuesday and do not hear back for two weeks, that is a problem.

What to Look For When Hiring

Industry Experience

An accountant who works with contractors is going to give you dramatically better advice than a generalist. They know percentage-of-completion accounting, job costing, retention, and industry-specific deductions. Ask how many clients they have in your industry.

Proactive Communication

During the interview, ask: "What does your year-round service look like? When will I hear from you outside of tax season?" If the answer is vague, keep looking.

Technology Compatibility

They should work with modern cloud accounting software (QuickBooks Online, Xero). If they still want you to mail paper documents, that is a red flag.

Clear Pricing

Get a fee structure in writing. Hourly? Fixed annual fee? Per return? Avoid surprises.

References

Ask for references from businesses similar to yours. Call them and ask: "Does your accountant proactively save you money, or do they just file paperwork?"

How to Maximize the Relationship

Keep Clean Books

The less cleanup your accountant has to do, the less they charge and the more time they have for strategic advice. Use bookkeeping software, categorize expenses properly, and reconcile monthly.

Ask Questions

Your accountant works for you. If you do not understand something on your tax return, ask. If you are considering a large purchase, ask about tax implications first. If you are thinking about hiring, ask about payroll tax impact.

Schedule Quarterly Check-Ins

Do not wait for tax season. A 30-minute quarterly call to review financials, discuss tax strategy, and plan for the next quarter is incredibly valuable.

Share Your Goals

Your accountant cannot advise you on growth strategy if they do not know your goals. Tell them where you want to be in one, three, and five years. That context changes their advice.

Bring Organized Information

When you meet, come prepared:

• Updated P&L and balance sheet
• Questions written down
• Information about major transactions or changes
• Plans for the upcoming quarter

Red Flags

• They never contact you proactively. A good accountant reaches out, especially in Q4 for tax planning.
• They miss deadlines. Inexcusable.
• They cannot explain your return in plain language. If they hide behind jargon, they either do not understand it themselves or do not respect your time.
• They charge for every five-minute question. Some billing is expected, but nickel-and-diming kills the relationship.
• They discourage questions. You are paying for their expertise. If they make you feel stupid for asking, find someone else.
• They are not keeping up with tax law changes. Tax code changes regularly. Your accountant needs to be current.

Bookkeeper + CPA: The Right Structure

For most small businesses, the ideal setup is:

1. A bookkeeper handles day-to-day transaction entry, reconciliation, and basic reporting. They keep your books clean throughout the year.
2. A CPA handles tax preparation, tax planning, strategic advice, and year-end review. They work with the clean books your bookkeeper maintains.

This division of labor is cost-effective. You are not paying CPA rates for data entry, and you are not expecting a bookkeeper to provide tax strategy.

The Bottom Line

Your accountant should make you money, not just cost you money. The right accountant pays for themselves many times over through tax savings, strategic advice, and problems avoided. Invest in the relationship, demand proactive service, and never settle for someone who just fills out forms.