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what your cpa needs to know

3 Important Factors: What Your CPA Needs to Know

June 3, 2021

Many people have strong relationships with their CPA because of years and years of working together. If you’re just getting started with a CPA, you might be unsure about what they need to know in order to provide the best services for your Tucson business. Here is a complete list of what your CPA needs to know to provide the best services and save you money and headaches.

Don’t Withhold Information From Your CPA

What is most important for you to know at the start of your relationship with your CPA is the more they know, the better. One of the biggest mistakes Tucson business owners and individuals make is withholding information from their CPA out of embarrassment, or carelessness. If you’re wondering what your CPA needs to know, we would say first and foremost they need to know about your tax history. When we start working with a new client, we ask for a few years of tax returns. This enables us to understand the client’s past so that we can improve their future.

In addition to previous years’ taxes, we also ask for basic financial data such as W2 and 1099 forms, real estate interest statements, receipts for business expenses for the current year. This will help us to dig deeper to ensure a clear understanding of our clients’ businesses and long-term goals.

What your CPA Needs to Know: Life Changes

Anytime a big life or business change occurs, there are several people you should notify… parents, employees, close friends, your children, and you guessed it, your CPA. While we don’t need an invite to the wedding, a major life event like a marriage is definitely something that your CPA needs to know about. A few other examples of events your CPA should know about are as follows:

  • A merger or sale of your business
  • A location change or move (out of city, out of state, etc)
  • Purchase of a new property or large piece of equipment (such as a vehicle)
  • Divorce or marriage

In essence, what your CPA needs to know about is anything that can impact the distribution of your business profits.

Projected Income Change or New Projects/Investments

Whether you anticipate fiscal challenges or you’re about to launch a revolutionary new product that promises to boost your revenue, it’s wise to let your accountant know what you’re expecting. This is one of the biggest parts of what your CPA needs to know because they can help with any cash flow or re-investment concerns. Additionally, if your business is venturing into new markets or about to start offering a new product or service, this change in direction could have an impact on your tax strategies and is something that your CPA needs to know about.

Your Long Term Goals & Retirement Plans

Do you have a timetable for when you’d like to retire? As a self-employed entrepreneur, you might be unclear on the differences between a traditional IRA and a Roth IRA. Regardless of your age, it’s never too early—or too late—to discuss retirement options with your CPA. Setting this plan in place with a professional is the best way to ensure you do it correctly the first time.

If you have long term goals for your business on a financial or other basis, your CPA can also help you put a plan in place to take strides towards those goals. Through budgeting, forecasting, and general planning, it’s amazing what you can accomplish with a great CPA by your side.

If you are on the hunt for a CPA, CFO, or help with your monthly accounting in Tucson or virtually, don’t hesitate to reach out to us for a consultation. We are happy to get you started towards reaching your goals!


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