7 Tips for Finding a CPA Specializing in Real Estate Investments
If you're involved in real estate investing, you might be wondering about a CPA that specializes on real estate investments. Here are 7 of my top tips.
If you’re a real estate investor or any other small business owner, you’re going to need an accountant. Even if you know something about bookkeeping or general accounting, you’ll still need an expert for your books so that nothing important is overlooked or forgotten. A CPA for your real estate investment would know the laws and rules that you need to follow, even when they change from year to year. This means that when you hire a professional CPA, you’ll always know that you’re on top of your finances. This, in turn, leaves you time to run your business instead.
If you need some tips and recommendations on how to find the very best CPA for real estate investors, below are some to help you get started.
Table of Contents
Always Interview More Than One Accountant
Just as you can’t be expected to buy the first car you test drive, you can’t possibly find a good CPA without interviewing several of them. A good number is three, and if you want to interview more than three, that’s all right too. Make a list of questions before you do the interview and ask all three of them the same questions.
If you do this, you’ll feel confident about the one you end up choosing. And speaking of choosing, take this part to heart. Choose the top-rated CPAs and ask them all the same questions. This is the best way to know that you have the right one in the end.
Consider Their Personalities
While it’s true that the CPAs’ personalities shouldn’t determine the final decision, you still have to take it into consideration. After all, if you don’t feel comfortable with calling them when you need them, what good are they? Establishing a good rapport with your CPA is imperative. CPAs are the same as any other professionals; some you will like, some you won’t. You don’t have to be best buddies with them, but you do have to feel comfortable enough to call them when you need them.
Think of it this way: if you feel uncomfortable in any way, you’ll be more hesitant to give your CPA a call, which defeats your purpose. And it doesn’t matter why you’re uncomfortable; if you’re not at ease, move onto someone else.
Always Vet Them Properly
You can always check out a CPA if you start the vetting process online. Reviews from real-life clients are easy to find and you should also ask each of them for some references to contact. If they don’t want to share references with you, that usually isn’t a good sign. If you’re unsure how to get names in the first place, check with other real estate investors or your real estate attorney for names.
If the CPA has another credential, such as the CFP (certified financial planner) designation, this is even better. The more you can find out about the names you’re checking out, the better.
Check Out Their Experience First
The most important factor to consider should be the CPA’s experience. This is a field that changes with each passing year, so you’ll want someone who’s been in it long enough to know a thing or two. There is no rule of thumb regarding how many years of experience they should have, but the more years they’ve been in the business, the better. CPAs have to take continuing education courses every year so the longer they’ve been doing this line of work, the more they’ll know. Period.
Of course, specific experience in the real estate field is also something to consider. Otherwise, you’re going to be comparing apples to oranges when you’re considering which CPA to choose.
Ask If They’re Available All Year Long
Tax season is not the only time of the year when you’ll need your CPA, so make sure that they’ll be available to you all year long. You don’t want a CPA who is only available until April 15. Businesses have tax forms due all throughout the year so this is an important factor to consider. Not only do they need to have this knowledge, but they also need to keep you up to speed on when your next tax filing is due. In other words, your CPA needs to keep you in the loop and prepare you for what is ahead.
Your CPA should have both real estate and tax experience; if they do, they’ll be able to take good care of you all year long.
Check to See Who’s Going to Do the Work
You certainly don’t want to hire a CPA who’s going to allow ten people to do your work. If they aren’t doing the work themselves, they should at least assign the same person to work on your account month after month. This way, that person will become familiar with your account, be able to guide you in the right direction, and give you the advice and assistance you need. They’ll know just what to recommend so that your business can grow and thrive, in part because they’ll become so familiar with it.
That being said, the person working on your account should have experience just the same as your CPA does. If they have no experience in the real estate business, they should not be assigned to work on your account.
Make Sure That They Give You the Right Answers
When you interview the CPAs and ask questions, they should give you the right answers to questions such as, do you have a PTIN (preparer tax identification number)? How do you bill for your services? Is your first consultation free of charge? Are you aggressive or conservative, and can you give me an example? Do you use up-to-date tax software? What happens if the IRS decides to audit me? Can I file my taxes electronically?
Most competent CPAs offer the first consultation for free, utilize billing services that are transparent, allow you to file electronically because they use the right software, and always have a PTIN because they are legit. If they give you any answers that you don’t like, feel free to move onto the next candidate.