The arrival of the new year presents more than just a time for reflection, celebration, and resolutions. It’s also the beginning of tax season. And if you’re a business owner, then you’ll need to start getting prepared to file your company’s taxes.
At Brennan and Company CPA, PC, we provide expert financial consulting services in Philadelphia, and we can help you and your small or medium-sized business get ready for tax season. In fact, every single business, regardless of how small, needs a financial and tax advisor; And not only that, but a Certified Public Accountant (CPA).
Let’s take a look at the differences between an accountant and a CPA, and why you need the latter to take full advantage of tax laws:
CPA Vs. Accountant: What’s the Difference?
The term “accountant” is a general one, and it refers to professionals who follow the rules, regulations, and guidelines set up by the Financial Accounting Standards Board (FASB). While CPAs are accountants, they have also passed a licensing exam in the state in which they practice. While many small businesses will employ the services of an accountant, there are significant benefits to utilizing the services of a professional CPA for your small business.
Each CPA is licensed by their state and must keep up with current tax laws in order to maintain their licensure. By comparison, accountants are not licensed. The examination for CPA licensure is rigorous, typically taking place over several days and covering numerous facets of tax and other financial expertise. CPAs must also complete continuing education classes and adhere to other standards of practice that accountants do not.
Knowledge of Tax Laws
Tax codes and other laws impacting small businesses can be quite complex, but knowledge of these intricacies makes up a substantial part of the CPA exam. Additionally, CPAs take courses every year to stay updated on changing tax laws and codes. Although an accountant might be able to prepare and sign tax returns, they cannot provide assurance of certification, and their ability to represent you before the Internal Revenue Service is considerably limited. In fact, the IRS classifies accountants as “unenrolled preparers,” a category which is wholly different from the “enrolled agent” classification that CPAs have.
Expert Financial Analysis
Even though a bookkeeper can perform a variety of financial tasks for your small business, a CPA can do a more thorough and nuanced review and analysis of your small business’ finances. Often, CPAs can offer advice on not only tax matters, but financial ones as well.
Audits From the IRS
Perhaps one of the most crucial reasons your business needs a CPA is their ability to represent you in an IRS audit. Sure, an audit can be a stressful and even scary situation, but hiring a CPA will offer you peace of mind knowing that they have the full authority to represent you in an audit and make claims on your behalf.
It’s simple—if you own a small business, then you need the expertise, knowledge, and protection that only a CPA can offer you. And at Brennan and Company CPA PC, we can help by providing you with trusted tax services and Safety…In Number$.
To schedule a tax consultation for your small business, or to speak with financial consultant in Philadelphia, call us today at 215-951-5585.