A certified public accountant, also known as a CPA, can be confused with an accountant. The word accountant is a very general term, basically discussing someone who works with finances and taxes. A certified public accountant is an accountant with specialized training. They have also passed a state licensing examination, making them a better fit for most businesses.
Here are some reasons why you should hire a certified public accountant over an accountant for your business.
- CPAs are licensed which means that they stay current on new tax laws in order to keep their title. It is a tough process to become a certified public accountant. The examination lasts for several days and ensures that your financial professional really understands finances and taxes. They must also continue their education on a yearly basis so that they are well versed on any new laws that come out.
- Certified public accountants usually understand tax laws more than most accountants. Although most accountants know about taxes, certified public accountants often know and understand the tax laws better. Their licensing examination, as well as continuing education, revolves around knowing and understanding tax laws. Though accountants are able to do your taxes every year, they are considered unenrolled preparers. It does not signify that they are certified or able to represent you before the IRS.
- If you get audited on your taxes, certified public accountants are able to represent you before the IRS. This is big. If you ever get audited, a CPA will be able to help you through this difficult process. They will be able to execute claims on your behalf. If you are going to spend money on someone to do your taxes, don’t you want to choose someone who is going to help you through an audit?
- Certified public accountants go above and beyond when it comes to analyzing your finances and taxes. Although accountants and even bookkeepers are able to take care of your financial records and give you reports, certified public accountants often give you a more detailed and thorough analysis on how you and your business is doing. They are also more qualified to give you good financial advice.
- Certified public accountants can help you run your business better. They can help you budget properly to ensure that your business runs with a good profit. They can help you set up a good system for your paperwork such as a good accounting software. They can help with payroll, your cash flow, and even be a sounding board with any purchases that you are thinking about making.
Though you might not want to spend the extra money on a certified public accountant, you and your business will be in a better place financially and when it comes to your taxes. They have to go through extra courses to become certified and they also take continuing education courses every year to stay up to date on the latest laws that they need to know and understand. Because of this, they understand the laws much better than regular accountants.
Certified public accountants can also be helpful during tax season. They are able to represent you if you ever get audited, which can make the stressful process go a little smoother. It is simply smarter to have someone do your taxes who is going to stand behind you if any problems arise.
It can also be quite helpful to have a certified public accountant to help you analyze your business financially. They are able to look through your paperwork and determine how well your business is doing – much more than just to let you know if you are making a profit. They may even be able to help you run your business even better by letting you know what smart financial moves that you can make.