Should You Do Your Own Accounting or Hire an Accountant?

Whether you are managing financial accounts as a private citizen, a freelance worker, or a business owner, you may reach a point where hiring an accountant seems like a good idea. Different factors such as your lifestyle, your current methods of account management, and where you expect to be in the future may affect your need for professional assistance.

As a private citizen, one of the most important factors in determining whether you need an accountant is analyzing where you are at in your life. As you obtain more capital, you might want a professional to manage your assets. Those who are just starting their professional lives may find that hiring an accountant is not necessary since fewer assets and liabilities make for simpler taxes.
Additionally, the benefits of hiring an accountant should be seriously considered. Tax breaks change from year to year and as your accounts become more numerous or complex, bringing in a professional may save you a significant amount of money.

If you find that the benefits of hiring an accountant are outweighed by the costs, it may be best to stick with personally managing your accounts or utilizing one of the many online accounting programs. Low cost programs such as Turbotax and Taxact are a great choice for private citizens who wish to file their own taxes. These programs may not catch all of the breaks available to you, however, they often prompt you with leading questions about your lifestyle which may take you to other parts of the process crediting you with various tax breaks.

In some cases you can get free tax help by making an appointment with volunteers at your local library. Be sure to call well ahead of tax day to see that you get an appointment.

For those considering bringing an accountant into their business, it is pertinent to analyze the demand and work available for such a position. You may find that keeping a CPA on staff is too costly. For owners of smaller businesses who typically handle most of the daily accounting, it may be feasible to train an office manager or administrative assistant in some of the bookkeeping to help lighten the workload, while paying an accountant on retainer to do your tax returns.

Alternatively, business owners may find that among other challenges of running the show daily, there just isn’t time to pay special attention to crunching numbers. As small businesses grow, the demand for a bookkeeper becomes greater. Aside from the fact that you may not have much space in your day to devote to accounting, you also may not be current on annual money saving methods, which an accountant would have expert knowledge on.

Keep in mind that whether you are running a business or managing your personal accounts, you will still want to know accounting basics to verify that your bookkeeper is a straight shooter. There is a lot to be said for referrals, so as you are searching for a trustworthy candidate, don’t forget to put your feelers out there and ask friends, relatives, or other business owners who they trust to manage their assets. Even if you can’t find a recommended CPA by word of mouth, most accountants can provide you with referrals.

Emma Martin works for Accounting Degree where you can find information on a  Associates of Accounting degree and research online accounting programs.

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