What's the benefit of having a CPA?

Question

Does anyone have a CPA and what exactly do they do for you if you're really into investing into properties. Could do write offs if you have a LLC or something?

1. What are some questions you would ask a CPA?

Daniel Hyman · Answer

Some CPA's try to remain on the compliance and tax filing side.

Others provide tax strategy consultations, tax projections, tax planning, bookkeeping, etc.

Having a firm that prepare your return and give you strategies as needed is nice combo.

Questions to Ask:

1) What is the value that your firm provides?

2) What is the fee structure?

3) What is the preferred method/frequency of communication?

Bill Hampton · Answer

Fahadbin,

I recommend finding an accountant that specializes in real estate taxation. You may want to consider working with your accountant remotely to expand your options.     I would also recommend looking for a tax strategist who is willing to work with you throughout the year, not just when preparing your tax return. You want an accountant that can help you strategize and who is responsive when you want to know the tax consequences of the decisions you are making throughout the year.

A good accountant will save you more than you pay them.

Good luck and let me know if you have any questions.

Brad Hammond · Answer

Hey @Fahadbin Alam, my CPA primarily just does my taxes for me.  If you are looking for someone to do your books, get a bookkeeper since they are less expensive.  I like that I can email her any time and ask a simple tax question if I need a quick answer.  That is an underestimated benefit of having a CPA.  In my opinion, you need to ask the right questions to any CPA.  Don't ask "can I do ..." but ask "how can I use my vacation as a tax write off" for example.

Besides that, you should have a strategy meeting every year and talk about what you can do ahead of time to reduce your tax liability.  There isn't as much that they can do after the fact.