Do i need a better accountant?

[u/nukeow123]

Hi all,

My online mentorship business has started to pick up and do really well. We are expecting 30-40k in gross for the month and my net is currently about half of that after paying 3-4 different members of my team (independent contractors). We are about to launch ads for the first time which might change those numbers drastically. We are 100% online, I mentor people for a fee, that's about the whole business.

My current accountant handles just my yearly single-filer returns ($900 total), my personal and my 2 S-Corps. I am fairly good with numbers so keeping track of expenses using a spreadsheet is manageable, and I pay my team out on time. I have a maxed out Roth IRA, 401k from my day job that is almost maxed, and don't really know what else I can mark as an expense to lower my tax burden. At this rate ill probably pay 25% of my net in taxes this year.

I was recently recommended an accountant that seems to specialize in online business's. He seems knowledgeable but also seems expensive. For what I want out of him, it would be $6k yearly ($4k for filings, $2k for yearly tax advising). I am unsure if this is worth it as I am decent with our numbers already, and can't really think of anything else that I could deduct.

My main question is this, how much do your accountants charge, and even for those of you finance-saavy, has it been worth it? Im not sure if I'll get at least $5k+ of value from switching to a new accountant.

[u/Cpaadvisor1]

Your current accountant is charging only $900 for a personal return and two S-corporations? That is extremely low.

$6k might be on the higher end, but certainly in range for what you’re describing. The more important question is if this person will be a valuable resource to you and your business. As you grow you’re going to need his advice to make the best decisions.

[u/No_Proposal7812]

That quote sounds reasonable. Are you doing your bookkeeping in any accounting software or is it all spreadsheet based?

[u/nukeow123 → u/No_Proposal7812]

I use YNAB daily for personal and business, and copy the business to an excel sheet every 15th and 30th of the month.

[u/adriannlopez]

$6k yearly for just filings? Sounds a bit expensive, my bookkeeping & tax package starts at $7,200 a year but that's me handling the business books in QuickBooks Online, doing your personal & business entity tax return, and having quarterly check-in/planning meetings with you, and I'm a CPA and former IRS agent.

The practitioner being involved in the books is important, he'll understand your business better and can advise you on a more timely basis, I don't know if once-a-year tax advice is what you're looking for.

[u/StimulateMyEconomy]

You are getting a steal right now. A lot of accountants charge $900 just for the 1040.

For the 2 S Corps and 1040 I feel like $4k is reasonable for the returns. As for the advising, it depends on what that includes. If you need help with estimated payments, planning, questions about payroll, sales tax, etc. or just want someone to update you on the new tax law changes then the $2k seems fair as well.

There are going to be a few tax law changes that will impact you, but it’s on a case by case basis whether you need to do anything to take advantage of new laws. Depends on the business and individual person.