A tax advisor for your small business can play an integral role in helping your business to succeed in the long term. Ideally, you want to choose a small business tax advisor such as Asena Advisors, who will be able to meet the increasing needs of your company as it grows over the years.
It’s beneficial to work with a company that fully understands your business model, how you started and where you want to be in the future. Here are some things to consider as you choose a small business tax advisor for your company.
Know What A Tax Advisor Does
A small business tax adviser is a licensed tax expert who is retained year-round to assist with the preparation and filing of business taxes, to provide tax and other financial advice, and to represent the business in the case of an audit. Other tasks include record keeping, tax planning, and optimizing tax returns for businesses. The company should not only have the skills and expertise to assist with taxes, but also be familiar with the complexities of business taxes.
Different Kinds of Small Business Tax Advisors
Technically, anybody can call themselves a small business tax advisor. Legally, all they would need is an IRS preparer tax identification number (PTIN). However, to be sure that your business and taxes are in the most skilled hands, you should be aware of the many types of IRS-certified tax consultants. These tax counselors fulfill the IRS’s extra standards for ability, education, and experience. Also, they are all permitted to represent you before the IRS:
- Registered agents – An IRS-licensed tax expert is an enrolled agent. These experts have either completed a three-part test demonstrating their tax expertise or have worked with the IRS for at least five years.
- CPAs – Certified public accountants (CPAs) are accounting experts who have passed the CPA Exam and abide by the CPA criteria. CPAs provide a variety of services, such as tax preparation and filing.
- Attorneys – Attorneys are professionals in the legal field who have passed the bar test and been granted a license to practice by their particular state.
Finding A Small Business Tax Advisor
If you currently rely on a CPA for other accounting purposes, he or she may also be qualified to act as your company tax counsel. In addition, referrals are an excellent approach to locating a tax consultant for small businesses. Consult with other business specialists you employ and respect, or speak with other small-company owners for recommendations.
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If you don’t have a recommendation, you could reach out to professional tax organizations to locate qualified company tax consultants in your area. The website of the Association of International Certified Public Accountants (AICPA) contains a database of CPAs, whereas the National Association of Enrolled Agents may assist you to locate an EA.
What To Ask When Choosing A Small Business Tax Advisor
When choosing a small business tax advisor, ask yourself the following questions. These questions can help you evaluate your firm’s tax requirements, and the business tax advisor’s suitability for your company:
- What function will the tax consultant play on my financial team?
Will your tax adviser collaborate with the other members of your team to ensure the success of your financial plan? Will they have access to all of your organization’s financial tools, including accounting and bookkeeping software?
- How much experience do they have in areas where I need assistance?
Request that the tax counselor provide some successful examples from previous clients. The majority of tax experts will be able to provide you with tales, testimonials, and even references. Make certain you investigate them. What you don’t want to hear is proof that the adviser has utilized aggressive methods that might generate red flags with the IRS, or strategies that are just plain unlawful.
- What experience does the tax consultant have with my particular industry or business model?
Does the advisor have expertise in your industry? Do they currently collaborate with anyone in your industry? Are they aware of any relevant trends or recent developments? What can you do to either capitalize on these trends or protect yourself from them?
You need to consult with a tax expert who understands your firm and its tax difficulties, such as the small-business tax rate. If you need to educate your tax expert on how your firm typically functions, they are likely not the best fit for you. If your business is not their specialty, a tax specialist should suggest you to someone else.
- What does the adviser do for their customers throughout the year?
Business goes on throughout the year, not just during tax season. You’ll need to have year-round access to your tax adviser so that when relevant circumstances arise in which you require help, you’ll be able to obtain it on a timely basis, maybe even prior to a particular transaction or occurrence. If your tax advisor only works from January to April and takes the rest of the year off, this might not be the best fit for your small business.
You need someone who knows how to apply the tax code to your specific scenario. You also want an advisor who will keep in contact with you throughout the year and notify you of any potential tax savings possibilities.
- To what extent will they be responsible for my tax return?
Finally, you want a consultant who will stand by their work. If issues arise with your tax return, your adviser must be able to resolve them. If you are subject to an IRS audit, your adviser should be able to assist you throughout the process.
When you take time to choose the best small business tax advisor for your company, you’ll be able to enjoy a professional working relationship that you know benefits your business concerns. Vetting a tax advisory business and asking the right questions will help you to find a company that suits your business needs.