Should a CPA prepare your tax return?


The AICPA says “Simply put, a CPA will save you money in the long run and look out for your best interests.  Anyone can drop numbers into software to prepare a tax return.  However, a CPA will analyze your specific situation for tax savings opportunities and help you plan for next year.” This blog post expands on some of the details.


More than half of all Americans hire a professional tax preparer. The top tier of professional tax preparers are Certified Public Accountants, Enrolled Agents, and Tax Attorneys. All three of these professional designations offer access to solid tax expertise.

Clearly there are advantages and disadvantages of using a Certified Public Accountant to prepare a tax return. For many taxpayers with a simple tax filing, a CPA might be unnecessary ‘overkill’. This post lists eighteen of the most cited advantages and the #1 potential disadvantage, particularly as they pertain to tax returns prepared by this specific CPA (the author).


1) High level starting point: The CPA knows that the tax return is not the beginning and the end of your financial world. It is possible that the tax return preparation is the least valuable service that a CPA will provide. A CPA is trained and tested in a wide range of business and financial issues including Financial Accounting and Reporting, Regulation, Auditing and Attestation, and Business Environment and Concepts. Awareness of data security and privacy issues are foremost. Your tax accounting might incorporate the application of a range of accounting systems and principles. Annual continuing professional education requirements in all these areas are rigorous.

2) Professional judgement: Taxation is often not a ‘black and white’ field. Many issues require judgment balanced between understanding of the technicalities of law and the practicalities of tax procedure and practice. Social media and misinformation raise the risk of taxpayer and preparer misjudgment. The intangible quality of professional judgement may well be the most valuable asset a CPA brings to the engagement.

3) Accountant-Client privilege: Some states allow additional legal rights to further protect your privacy in the event of a legal dispute or investigation. In states where this privilege is not incorporated into law, a CPA knows how to achieve the same level of protection through engagement by your attorney.

4) Extended access and mid-year review: The CPA is available year-round, not just during tax season. Access outside of business hours is available by arrangement. Basic tax preparation service includes the ability to ask a question any time of the year and includes at least two mid-year checkups to make sure that your tax planning is on track to maximize savings.

5) Flexibility: You can use any combination of paper or electronic communications: in person, hand delivery, mail delivery, email, fax, secure document portal, text message, or telephone communications. It’s your choice as to whatever works best for you.

6) Timeliness: You can make arrangements for completion on a specific timeline, including rush services when necessary. Your written work plan agreement will include a timeline for completion of the work. A CPA can plan to make your tax return filing one of the first of the year if you need a fast refund or delay until the last minute if you need to wait for things outside your control.

7) Bundled services: Tax preparation is bundled with other year-round tax services, including audit response and representation, mid-year tax review and tax planning for next year.

8) Reliance on professional position: One of the strongest defenses a taxpayer can offer in the event of a tax dispute is that you relied on the advice of a competent tax professional. This alleviates some types of potential tax penalties.

9) Confidence: CPAs do not offer to lower your tax bill, as compared to other tax preparers, or say that you are less likely to be audited when your tax return is prepared by a CPA as opposed to unlicensed tax preparers. It would be unethical of a CPA to do so. However, your confidence is likely to be higher when using a CPA than another type of tax preparer. We commonly hear statements like “I just like knowing that my tax return was prepared by a CPA”.

10) Review process: CPAs are trained in professional skepticism; a form of work review that requires discipline and skill separate from the tax return preparation. The tax return review is a separate procedure, performed on a different day than the tax return preparation, using a different logic and approach. Our review process concludes with recording a personalized video for your reference later.

11) Financial planning: The tax return is often the most practical launch point for a discussion into a wide range of personal and business financial planning issues. A CPA with expertise in both tax and planning can extract useful suggestions for further discussion.

12) Access to additional areas of expertise: The CPA has additional training and expertise in small business operation, real estate, compensation and benefits, and investment portfolio management. These optional additional services are available from the same professional who is already familiar with your tax details.

13) Longer than one year service available: While most preparers offer service for one year’s tax returns, the CPA can offer a time period to match your needs. This can be for a period in the past (when missing filings or amended returns are necessary) or into the future (for an estate or complex business transaction).

14) Audit representation: In the event of an audit or tax dispute, a CPA can be your legal representative before the IRS or state tax authority. There are often significant advantages of having the same person who prepared the tax return defend their positions in an audit.

15) Secure records storage: CPAs are required to maintain secure storage of the tax returns and supporting documents. In fact

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, we keep a lot more than that; just to refresh our memories and provide support in the future. Your tax returns are kept in a secure storage facility, monitored for access, along with copies of your business licenses, contracts, ownership agreements, trust documents and other important papers. Clients often call during the year to say “I can’t find a copy of…” and we always have it ready to send.

16) Best version of tax return: There is not one single version of your tax return. In fact, there are multiple versions used for different purposes. When an elementary school asks for a copy of a tax return to verify address and dependents, for example, they should receive a different version than when a mortgage lender or the county auditor asks for a copy to verify eligibility for local tax credits. Certain private information may be excluded or redacted, depending on the specific need. A CPA keeps up to a dozen different versions of your tax return for different specific customized purposes.

17) Integration with bookkeeping: If you have investments, cryptocurrency, real estate, or a business, then the task of converting your bookkeeping records to a format that can be used for preparation of the tax return can require significant amount of work. Accountants refer to this as “book to tax” adjustments. The CPA who controls the bookkeeping and prepares the tax return optimizes the system so that one flows easily into the other with little or no additional work or expense.

18) Letter from CPA: If you are a real estate investor, an investor in certain qualified investment programs with limited access, or a business owner, then you may be required to provide a letter from your CPA by the lender or government agency. In some cases, this can prevent a significant obstacle. Some third parties even make requests that a CPA is not allowed to fulfill. But a skilled CPA tax preparer can use a cover letter accompanying your authorization to release the tax return to satisfy the third-party request without the snags and potentially expensive additional requirements of a separate CPA letter. Some leveraged real estate investors say this is the single most important reason that they use a CPA tax preparer.


The primary disadvantage is cost. A CPA or attorney with an advanced tax designation (LM or MT) and many years of professional tax experience is more likely to be the most expensive type of tax preparer. Some tax professionals use a rule-of-thumb ratio that tax compliance services should not cost more than one percent of your gross income. In today’s more complex tax environment, that cost limit rule is no longer always possible. CPA clients typically budget more for ancillary tax support services than for preparation of the tax return itself.

To help ease the disadvantage of this expense, a monthly payment option may be to spread the cost evenly over the full year.