How to make relationship w/ a CPA?

13 Replies

Hi there!

My husband and I closed two weeks ago on our first duplex and I quit my job to begin working for myself (I am an architect). I am looking for any recommendations to a local CPA in Los Angeles area. And wanted to know how you build relationships with them. My old CPA is a family friend and he retired and moved out of the country. I would bug him with a phone call for every little question that I had. Now that I have a duplex and I'm starting my own business, I need a new CPA. 

There is a CPA in my neighborhood but he charges per consultation and I don't know how to approach him to establish the kind of relationship I had with my old CPA. The type of relationship that I am looking for is that I can call/email her/him for any little question that I have but that s/he knows that I will do my taxes with them. And if they could advise me in the deductions to take, the receipts to keep, etc. I don't think I require any bookkeeping from them yet.

How do you start the conversation and how do you vet CPAs? Also, any recommendations with CPA in Los Angeles, CA area?

Thanks!

To get one like that you probably need some sort of personal relationship. That’s how my relationship with my cpa is but he’s also a friend, so I get a good deal

@Wei Cho Good question and congrats on the duplex! If you are comfortable working remotely with a CPA there are a number on BP that do (myself included). Take a look through Tax & Legal and you'll be sure to find plenty posting here.

Many of us have prepared multi-state returns and are comfortable with the nuances of state taxes.

Otherwise, I'd get a couple of local recommendations and meet in person to see if there is a fit.

Let me know if you have any questions I'd be happy to help!

@Wei Cho  

I recommend talking with a few tax professionals and finding one who is  a good fit for you.

I think having an expertise and experience in your industry is veryyyy important- but it's also important to just kind of click with that person. You want someone you feel like you're having an open/casual conversation with...not where you're scarred to call them, or stressed by the idea. 

Talk to a few people- see who feels right and kind of has the same business approach as you. Same general outlook with regard to investing, life style, ect. I'm all about creating a life by design- when I have clients who call and say their goal is to retire by 40 so they can travel with their kids...shoootttt that resonates with me. Find someone who resonates with you. 

There's multiple tax professionals who have been on BP for years and you can kind of get a feel by reading back through their responses. 

Additionally, if you prefer a face to face I know an Excellent CPA in the LA area who works with a lot of investors.

Good luck in your search! 

@Account Closed that's a great way to open communication! Yes, I try to have people in my team who have the "real estate investor" / retire early mindset. I will PM you, I want to talk to as many CPA as I can.

Thanks everybody is so supportive!

@Wei Cho try reaching out to @Logan Allec who is a CPA in LA and is usually very willing to share his expertise on BP, and I believe offers a free consultation. I have several names for you in San Diego if you’re willing to work remotely. For CA residents, you’ll likely want to work with a CA based CPA or at least one who is very familiar with CA laws. California is sort of its own beast when it comes to taxation and can be very different from the rest of the country. Try asking around or looking at reviews and have a phone call and see who you click with. Feel free to ask the CPA outright if that is a relationship they’re willing to have with you. Also, good advice is definitely worth paying for so if you find someone you feel confident in and like, though they may have a different fee structure, might be worth going with them than someone who doesn’t charge you but gets the answer wrong...

@Wei Cho

I second the recommendation of @Logan Allec - provided he is willing to accommodate the relationship you're proposing.

To be honest, I would not - if you asked me. What you're asking for is free ongoing service (yes, it is service, because it takes our time) in exchange for one annual paid job. It's like expecting free appetizers or drinks from a restaurant year-round because you bring your family there once a year for an anniversary dinner. Or expecting free cleaning from your dentist because you will come to him when you need a crown. Or a free oil change from your mechanic because he is the one you use for major work.

I know we live in the freebie culture, but you use the word "relationship." Relationship involves respect. If you want a win-win relationship with you future CPA, I suggest you approach it with due respect for his/her time and expertise and not expect freebies, at least not until the relationship is strong. (Yes, I will do many favors for my long-term loyal clients, but not necessarily for someone I just met.)

@Wei Cho I think only 5% of Cpa knows what they are doing when I comes to REI tax returns.

That said ask for referrals.

@Wei Cho You already got a ton of great advise, especially from @Account Closed .

What I would add is, come up with a list of questions that are important to you! Meet (virtually or in person) and speak with a few CPA's, depending on the responses make your choice. So the conclusion should not be based solely on the price they charge for the tax return. You must think long term, how much they can save you in a long run by offering maybe solid tax strategies. 

I can share my list of questions, if you'd like.

Best!

Here is my two cents worth.  I am an Accountant. I will take phone calls once a month free as long as it is a quick question from anyone whom i do just their taxes.  If it takes more than 5 minutes there is a charge.  I do consultation free.  If you are a continual client meaning if I look over your books and do monthly reports i charge a fee you can call me whenever you want.  I will also do your taxes for you for a extra fee depending on the scope of the work needed to be done.  

I hope this makes sense to you.

Originally posted by @Michael Plaks :

@Wei Cho

I second the recommendation of @Logan Allec - provided he is willing to accommodate the relationship you're proposing.

To be honest, I would not - if you asked me. What you're asking for is free ongoing service (yes, it is service, because it takes our time) in exchange for one annual paid job. It's like expecting free appetizers or drinks from a restaurant year-round because you bring your family there once a year for an anniversary dinner. Or expecting free cleaning from your dentist because you will come to him when you need a crown. Or a free oil change from your mechanic because he is the one you use for major work.

I know we live in the freebie culture, but you use the word "relationship." Relationship involves respect. If you want a win-win relationship with you future CPA, I suggest you approach it with due respect for his/her time and expertise and not expect freebies, at least not until the relationship is strong. (Yes, I will do many favors for my long-term loyal clients, but not necessarily for someone I just met.)

@Wei Cho

I agree with Michael.  Good advice is worth paying for, and having an accountant do your taxes isn't exactly a huge money-maker for the accountant (most CPAs I know work on a flat-fee for taxes, which works out to fairly small dollar amount per hour).  Their expertise IS their livelihood.  You clearly find value in their knowledge or else you would not be asking them questions about the complex topics and subject matters for which they have such expertise.  Find a CPA who knows what he/she is doing and is also pleasant and respectful towards you, try to do as much research as you can on your own, and pay the CPA for their expertise when needed and save yourself hassle and worse money issues later by doing it right in the first place.  I'm not saying you should find one who nickel-and-dimes you for every phone call, but anything that requires them to spend more than maybe 30 minutes or an hour is worth a billable fee, particularly if you are in search of the correct answer.

@Katie Lepore , @Michael Plaks , @Lane Kawaoka , @Alina Trigub , @Michele B. Thank you all for your responses! I feel like I'm more equipped to go out there and find a CPA whom I can build a trusting, long-lasting relationship. But I suppose you build it over time. My other criteria is that they are real estate investors, or that at least they work with them. Thanks again!

@Wei Cho , I been through it.

Early on, I found a CPA through recommendations, after a few years, he closed his business to go into another line of work. Then I found another one, had him a short while, then he caught the political bug, and joined a campaign for a politician, and then went into politics himself.

I was on my own for a few years, bought a few rentals, then a business. I manage to do all the taxes on my own. But if you're in business, do it yourself, your have to do payrolls, federal withholding, state withholding, workman's comp, unemployment  insurance etc. I did it all by myself, but the problem was if I had a question, I had to find the answers on the internet, or call the IRS etc.

This time around, I didn't have any good recommendations, but I went around the neighborhood, and found a CPA with a store front office. At the time I had my MBA in finance and studied Real Estate at the NYU School, including real estate accounting. I interviewed him, he gave me a few wrong answers on real estate accounting, but overall he had a good grasp on taxes, deductions, doing payroll which I done, so I decided to go with him. In fact, he reviewed the taxes that I did myself a year and two back, and found I missed some deductions, including a major one, costing me a few thousand dollars.

The way we worked it out, that was over 25 years ago, for $175/month, he'll handle all the taxes filing for Federal, State income taxes, file our personal and the business taxes year end which is in an LLC, the partnership 1065 return and K1's. I also have an S Corp. So this way, he gets paid monthly, and if I had a question, I can call him, and if he has to do research, he'll call me back. By paying him monthly, he doesn't get the feeling I'm a once a year customer asking for freebies in between. I'm semi retired now, sold a few of my rentals, and the business that's in an LLC, I sold. He's still my CPA, I no longer pay the $175/month, pay him year end, but he still handle the accounting for the remaining rentals. In fact, if he didn't hear from me for awhile, call to see if I'm OK, and several times a years, I'll take him out for lunch, and he reciprocates taking me out.

Since you're going in self employed, maybe you can work something out along the lines I have. When I started REI, I went to a few local RE club meetings, and people come around to sell services, including CPA's.