8 Questions to Ask When Interviewing a CPA

By
May 18, 2018
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Some people believe that one of the most frustrating words in the financial world is the word “taxes”. But it doesn’t have to be…and it actually shouldn’t be. Understanding the world of taxation takes enormous amounts of education, understanding and application. The average person doesn’t necessarily want to become an expert on taxes, but they certainly don’t want to pay more than they have to, either. Hence the reason many people and businesses reach out for help. Finding a tax professional can be complicated; hoping to find the right kind of tax professional for the services needed tends to be the number one challenge.

When starting a search to find the right tax professional, there are basically two major things to consider. Firstly, it’s important to understand the differences between the types of tax professionals. Secondly, it’s important to ask the right kind of questions to help discern if a working relationship with a particular tax professional is a good fit.

Start with having a basic understanding of a few different types of tax professionals.

TYPES OF TAX PROFESSIONALS:

Tax Preparer – A tax preparer can help individuals, families, and businesses prepare tax returns. They cannot represent clients during an audit. Their role is limited to tax preparation. A large percentage of the general population might find that a Tax Preparer is a match for their filing needs.

EA – An Enrolled Agent (EA) has passed an IRS examination that puts them in a position to not only help clients prepare tax returns, but they can also represent their clients in the event of an audit. Generally speaking, EA’s may tend to have more thorough knowledge and understanding in regards to tax preparation than that of a Tax Preparer. Individuals, families, and business owners might find that an EA is helpful due to the complexities that their tax preparation needs may entail.

Tax Attorneys – Tax Attorneys can not only prepare tax filings, but they can also represent their clients during an audit, as well as represent clients in court proceedings. Tax attorneys play a significant role in helping their clients through complications with tax liabilities, responsibilities, and other issues that may arise.

CPA – Certified Public Accountants are tax professionals who have a degree in accounting or a related field. They have passed the state CPA exam, and are able to perform a myriad of services for their clients. They can prepare tax filings, represent clients during audits, prepare and certify audit statements. They cannot, however, represent their clients in court.

There are additional types of tax professionals, but the above mentioned tend to be the most widely sought after by individuals, families, business owners, non-profit entities, and others.

Secondly, it’s important to ask questions that are relevant for finding a professional that might be best suited for the specific needs at hand. Here are a few questions to consider when interviewing a tax professional:

QUESTIONS TO ASK:

  1. What is your designation, or professional title?
  2. What industries or types of clients do you have?
  3. How many years of experience do you have?
  4. How many people do you have in your organization, and what are their roles?
  5. Do you help clients with tax planning strategies, as well as tax preparation?
  6. Do you work in collaboration with financial planners and other professionals?
  7. What kind of ongoing service model do you have?
  8. What is your fee structure?

When discerning which tax professional to work with, having a basic knowledge of the types of tax professionals might go a long way with helping to build a productive relationship, and subsequently, possibly more favorable tax solutions. Taxes are a major part of life, and having a strategy around how finances are built, managed, and maintained could possibly help significantly. It’s important to be responsible with taxes, and having a professional that can help discern taxation with efficiencies could have significant importance to overall financial planning.

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By
Zach Swaffer, CFP®
May 9, 2019

Whenever new technology enters the world there are two inevitable emotions: excitement and fear. The thrill of new possibilities tempered by fears of new tech failing to live up to the hype. Take, for example: Robo-advisors. A great example of the complexities surrounding emerging tech, Robo-advisors provide automated digital financial advice based upon algorithms and/or mathematical rules.

When Robo-advisors launched in 2008 they were heralded as the dawn of a new era in financial planning. Some experts even believed this advancement signaled the end of financial planning (and real, human financial planners) as we know it. Not so. Over a decade later Robo-advisors are still around; however, they have failed to take over the financial planning world as predicted and in fact many are shuttering their doors or seriously scaling back on size.

So what happened? Why did Robo-advisors fail to eliminate the role of humans in the financial planning process? At the end of the day, it comes down to human connection. While an algorithm can crunch numbers, make predictions, and even offer investment advice, it cannot form impactful and lasting relationships like a real human. Investment selection and management is a part of what financial planners do – but that is only the tip of the iceberg. Real, effective financial planners are there to prepare you for and coach you through life’s unexpected inevitables. What happens when some life event inevitably occurs or you have a pressing question about your financial plan and when you try to get an answer you reach an automated phone tree that leads nowhere? Unlike a Robo-advisor, a financial planner is a real human available to provide advice and support when you need it. Think of them like a coach for your finances!

True, a human financial planner may cost more than a Robo-advisor. But in return they provide much more value. A study conducted by Vanguard found that working with a financial planner can add about 3% to client returns with 1.50% of that coming from behavioral coaching (that’s half the value coming from coaching alone!). When you start working with a planner you are not simply hiring an investment manager. Instead, you are partnering with someone who will work with you as life evolves to achieve your unique priorities. As you progress along your financial journey you form a trusting relationship with your advisor, so whenever you have questions or concerns you know there is a real human you trust who will answer the phone and provide clarity for you.

By
Jeff Motske, CFP®
January 7, 2019

When we look outwards, most of our world can seem like chaos. Political events impact the market. Technological changes create new employment opportunities and put others to rest. Illness and misfortune affect those we love. It is easy to fall under a sense of helplessness in these moments. The key to weathering these storms is to focus on the elements you can control to make for a better financial future.

The first step is to create a solid plan. Many hope for a good outcome, but hope is not a strategy for a sound future, financial or otherwise. Your plan should reflect personal and financial goals. If you have created a personal mission statement, the goals in your plan should be inspired by that. The key aspect to a plan is that it identifies possible issues and gives you concrete steps to take to weather any storms.

Part of your plan should always include paying yourself first. There are going to be numerous obligations and goals to funnel your finances towards. Be sure that saving for your financial independence is one of them because there aren’t any do-overs when it comes to retirement savings. Just as important as saving is how you save. Make sure to fill your three buckets for more financial flexibility when you retire. The more options you have, the more control you have over your financial future.

After all that work, make sure to protect your plan. Life insurance will cover your debt and obligations, should you pass. Other forms of insurance can also provide during retirement or should you become disabled. Preparing for unfortunate or far-off events is a difficult thing for many to do, but a little planning in this area can protect everything you’ve worked so hard for, for your loved ones and your legacy.

None of us can see the future or know what tomorrow will bring. With a little forethought and planning, though, you can make sure you’re prepared for whatever life throws your way. Be sure to focus on what you can control and those strategies will help you build a better financial future.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

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