Take the anxiety out of tax time by finding an accountant who is the right fit for your home building business
Being audited by the IRS can feel like a disaster waiting to happen if you’re not confident in your accounting methods, and filing taxes can be a confusing and complicated process – especially if you’re a business owner. Unless you’re a wiz at numbers and well-versed in ever-changing tax codes and regulations, the safest and most business-savvy decision is to outsource your finances to a professional accountant.
When dealing with an industry you lack experience in, it’s imperative to hire the very best person for the job. For true peace of mind, you must be able to trust your accountant to perform the work professionally and appropriately in a manner that will not only satisfy the IRS but also inform you of potential opportunities to help you decrease costs and/or increase your profits. Make a list of key questions and considerations before putting the well-being of your business in the hands of a CPA.
Ask about business basics
When interviewing potential prospects, start with the basics and get more in-depth with your questions once you know the candidate is at least foundationally appropriate. Make a list of “need to know” questions and consider including the following:
- What certifications and licenses do you have? When it comes to professional credentials, you’ll want your accountant to at least have their Certified Public Accountant certification, but other credentials like insurance licenses may be beneficial as well such as a being a Certified National Association of Home Builders (NAHB) Trainer.
- What experience do you have? Experience involves more than time. Ask if they specialize in a particular business or customer type. Many accountants specifically work with either businesses or individuals and many often specialize in specific industries. You’ll also want to make sure the prospective accountant has knowledge regarding the home building industry? Can they handle a firm with your size and scope of business?
- What kind of services do you offer? Organizing your accounting system is the bare minimum. Do they offer consulting services regarding strategy or mergers and acquisitions? Can they help with valuation, financial analysis, and bookkeeping?
- Will a specific person be assigned to my account? Many accounting firms have one specific point of contact. At No Boundaries Advisors, we have a team working on each account in order to maximize customer service and continuity. Each customer has a client service coordinator, an accounting or tax manager, and a partner who can address higher level conversations and problem-solving. Inquire about how your prospective accounting firm will handle your account, and choose a set up that will meet the needs of your business.
A more personalized approach
Contractors often use two different methods of accounting, depending on the length of their contracts and the amount of average annual gross receipts (over the past 3 years). Many prefer the cash method of accounting, but it’s not applicable to every type of taxpayer. If the cash method (over the past 3 years) totals more than $25 million, you’ll be using the accrual method.
If you do utilize long-term contracts, the Completed Contract Method of accounting may be an option. This accounting method allows the taxpayer to delay reporting income and expenses until a contract is completed.
Once you’ve found someone who can meet the basic needs of your business, it’s time to get into the details regarding your company’s exact needs:
- Is my corporation set up in the most appropriate way for the business I’m doing?
- Which accounting method should be used for the types of projects I’m working on?
- Are there any deductions that I may not be aware of, and how can I take advantage of those going forward?
As with all things, personality matters too. You’ll want to find someone who can explain things in layman’s terms and who you communicate easily with; you may have a lot of inquiries that feel like general questions, but the answers will be important, so find someone who is patient and understanding of your desire to learn.
The ideal CPA has the ability to wear many hats: bookkeeper, tax preparer, financial planner, business advisor, professional sounding board, and representative if an IRS audit ever does occur. Take the time to find an accounting firm that is the best fit for your specific business so you can get back to work with the confidence that you’ve insured yourself against risk regarding complicated financial matters.
No Boundaries Advisors has been helping businesses like yours grow and thrive for over 25 years. Contact us today to find out how our expert staff can help you meet your financial goals.