A Physician’s Guide for Picking a CPA

Keeping more of what you make is a crucial part of your 2013 business model and your 2012 taxes are a great place to start. Tax time has always been an unnecessarily stressful time for doctors, partially because many we have seen wait too long to make meaningful tax-planning changes because they are too busy working to make more money they’ll in turn pay excess taxes on, a vicious circle.

We’ve previously discussed why having a great CPA  is an indispensible part of the core team every doctor needs. A logical follow-up question is how to pick that great CPA in such a crowded field. This is important for several reasons in addition to the savings great CPA will help you realize, not the least of which is the fact that even if you have your taxes professionally prepared, you the taxpayer are legally responsible for the accuracy of the return.

As always a great place to start you inquiry on any tax matter is by looking at what the IRS itself says.The suggestions below come from the IRS’ own consumer advisory:

Verify their qualifications

Are they affiliated with or licensed by a professional organization that provides its members with continuing education, oversight and which holds them to a code of ethics? Current regulations require that all paid tax return preparers including attorneys, CPAs, and enrolled agents have a Preparer Tax Identification Number (PTIN) before preparing any federal tax returns.


Check on the preparer’s history

Check to see if the preparer has a questionable history with the Better Business Bureau and check for any disciplinary actions and licensure status through the state boards of accountancy for certified public accountants; the state bar associations for attorneys; and the IRS Office of Professional Responsibility for enrolled agents.


Ask how they charge and calculate fees

Avoid preparers who base their fee on a percentage of your refund or those who claim they can obtain larger refunds than other preparers.


Make sure you can reach them for future support

Make sure you will be able to contact the tax preparer after the return has been filed, even after the April due date, in case questions arise.


Provide all records and receipts needed to prepare your return*.

Most reputable preparers will request to see your records and receipts and will ask you multiple questions to determine your total income and your qualifications for expenses, deductions and other items.


Don’t sign blank returns.

Avoid tax preparers that ask you to sign a blank tax form.


Review the whole return before signing it

Before you sign your tax return, review it and ask questions. Make sure you understand everything and are comfortable with the accuracy of the return before you sign it. Your signature is your confirming that it is both true and correct.

The preparer must also sign the form and include their PTIN

A paid preparer must sign the return and include their PTIN as required by law.

In addition to these guidelines, here are a few of mine:

1. Don’t ever provide a tax preparer checks that are blank or made out to anyone other than the tax authority itself.

2. Ask if they have experience with clients at your personal income level and at the gross revenue level of your practice if you are looking at the same provider for both.

3. Ask if they have knowledge of any industry specific issues that affect your business or for examples of places they have found opportunities for savings and improvement with others.

* I looked for a good checklist of records to look for and start compiling if you have not done so already to send to my own clients. This link goes to one of the most complete ones I found, and includes the best features of the lists of several other top tax sites. As always, no tax article in a general forum constitutes or substitutes for tax advice, which is the point we are trying to make. Get great help today if you don’t already have it.