When you shop around for a new small business accounting firm, salespeople will often promise how much they can save you in taxes.
But how do they know? They don’t know your business at all. Let’s look at this with a hearty dose of skepticism, especially if you left your last accountant because you felt you overpaid in taxes.
At CSI Accounting & Payroll, we’ve provided monthly accounting and business tax services for nearly 60 years. That means we’ve spoken to thousands of prospective clients about their tax outlook, answering questions like:
- Why can’t CSI tell prospects how much we’ll save them in taxes?
- What can monthly accountants do to change your tax liability? What can’t they do?
- How far out can we project tax liability for clients?
We Can’t Tell Prospects What They’ll Save in Taxes
If we haven’t worked with you, we won’t know what your tax liability will be. Just looking at a tax return doesn’t give us enough to make a real projection, and it would be unethical of us to quote savings that we can’t guarantee.
So, what do we need to start on tax projections for new clients? The bare minimum is:
- Your last tax return.
- Everything your last tax preparer needed to generate your last tax return.
- Full context on your business’s financials, current situation, and predicted big changes.
That’s enough for a start, and some new clients who come on board early in the year will get an updated tax projection later on as we get to know their business more.
Another reason why we can’t promise tax savings to prospects is that we haven’t had the chance to try to improve their tax outlook yet. Let’s talk about that next!
How Monthly Accountants Change Your Tax Liability
Let me quote two opposite statements that are both kind of true. “Accountants can’t change what you owe in taxes. They’re predetermined.” “Accountants can minimize your tax liability with tax strategy.”
An accountant can’t wave a magic wand and save you in taxes, but they can advise you on the actions you need to take to minimize your tax liability.
Advice topics may include:
- Maxing out your retirement contributions.
- Choosing the most tax-advantageous way to pay yourself.
- Evaluating whether you’re in the best entity structure.
How Far Out We Project Client Tax Liability
Tax projections are part of a complete tax strategy.
When we provide projections for our clients, our goal is to let clients know their tax liability – several months ahead of time. This helps you prepare for a large tax bill if your business has been growing.
We can even project out past one year, although this number is less accurate. It can’t account for unexpected changes to your sales, expenses, and situation. Fortunately, most businesses aren’t looking past the current tax year.
Know Your Tax Liability
Now that you know why we can’t tell prospects how much we’ll save them in taxes, what we can do to change your tax liability, and how far out we can project taxes for clients, are you ready to check out monthly accounting services?
If so, please consider CSI Accounting & Payroll! To see if we can be a good fit for your business, click the button below for a free consultation:
Not ready to talk? That’s okay! First, learn more about what it’s like to work with us by clicking the image below:
