As we near the end of the year, many people begin to think about to-do lists for the early part of the next year. Often, these thoughts will include preparing for taxes.
If you’re starting to see some growth in your speaking or writing business, you might be wondering if it’s time to hire a tax professional.
I want to answer that question, but first let me clear up a couple other questions you might be wondering about first.
Can we trust you as a Certified Public Accountant to answer these questions?
Absolutely. I would never push someone to hire me or another CPA when they don’t need it. That’s bad business and unethical. I have regularly turned people away as clients after giving them a few minutes of advice.
What type of tax professional is best for creative entrepreneurs?
There are three options for tax preparation: do it yourself, go to an H&R Block or similar organization, or find a CPA.
I recommend finding a CPA if you’re a small business owner, especially a speaker or writer, because you need someone with the expertise necessary to handle the specific needs of a creative business owner.
A CPA is required to have a masters’ degree in business and regularly take courses to stay current, whereas an H&R Block tax preparer has about a month of training on specific tax software. It’s just no comparison.
When to hire a CPA
I’ve counseled people to consider these three factors to determine whether or not to hire a CPA:
- Time. After a certain amount of growth, the time and effort it takes to do your own taxes competes with other ways you could be growing your business. Between writing, sending proposals, developing speaking sessions, and actually speaking, you have to choose carefully where to invest your time.
It’s normal for a business owner to eventually feel like it’s too much to manage independently. Delegating your taxes to a trusted professional gives you more time to do all the things you love—the reasons you got into this business in the first place.
- Complexity and risk. How comfortable are you with the tax and accounting decisions you are making for your company? The tax code is complex, and it changes every year.
Often, a CPA has the expertise to save you more on taxes than the fee he charges. When you hire a professional, you’re not liable for mistakes or miscalculations. If you begin to feel uncertain that you’re making the right choices, or obsessing about being subject to an audit, then it’s probably time to hire a CPA.
- Motivation or interest. Most people don’t get excited about taxes. Not even CPAs, if we’re being honest. I understand that you will never jump out of bed with a grin on your face and declare, “YES! Today I get to do my taxes!”
If you find yourself scrolling through Facebook, watching reruns of The Bachelor or deep cleaning your kitchen every time the thought of taxes comes up, then it’s probably time to hire someone to do it for you. There’s no need to stress or procrastinate. Just bring in a professional.
Chris Morris is a CPA and the founder of the creatively-named firm Chris Morris CPA. He focuses his firm on creative entrepreneurs, and has the privilege to include photographers, authors, publishing presses, public speakers, and magazines as his clients. http://chrismorriscpa.com/