What should I look for in a CPA?

Question

Hello BP! I’m a newb, under contract for my “first” property (it’s actually my second, but the first one I’ve bought specifically as an investment property). I started an LLC to hold my properties in and I’m meeting with an accountant this week that I may hire as part of my team. My plan was to have a tax professional who is familiar with real estate on board right away so I’m doing things the most tax-efficient way possible from the beginning. I know the family that owns the firm, I went to school with some of the kids and I’ve known them to be decent, honest people, which is why I’m going to them first. My question is, what kind of questions should I ask and what specifically should I look for in an accountant/tax professional? I am meeting with the owner, the guy in charge of their real estate tax planning services, and a “staff” member, but apart from making sure I hire someone familiar with RE, I’m not sure what else I should be looking for. Any comments/suggestions/tips on what to look for or what to avoid would be greatly appreciated!

Brian Schmelzlen · Answer

That really depends upon the firm you are working with. My firm, for example, generally does not charge for initial consultations if there is a potential of someone becoming a client. Personally, I don't like to charge to answer simple questions because I want my clients to be contacting me and not worrying about being charged. However, for larger consultations and anything that I would have to research, I charge an hourly rate (that is disclosed in advance, as well as a maximum amount of time I will work without receiving additional authorization).

Brian Schmelzlen · Answer

Outside of real estate-related tax knowledge, the most important thing, IMO, is how well they communicate. How quickly do they respond to your calls and emails?

Caleb Heimsoth · Answer

Make sure they have experience with real estate investors and respond well. My cpa responds within a day usually and I can upload stuff to his website. It’s very easy and convenient

Megan Hirlehey · Answer

Brian - they took about 2 days to respond to my initial inquiry to set up an appointment which annoyed me, but when they did it was the owner who called me to set up a meeting so I’ll give them a pass. Beyond that, haven’t had any other experience yet. Yonah - thanks for the link, I’ll check out that post right now!

Yonah Weiss · Answer

@Megan ClancyWelcome to BP. Someone just asked a similar question a few days ago, and there were some great responses, as well as links to other previous forums about this. Here's the link:https://www.biggerpockets.com/forums/311/topics/513285-what-to-ask-cpa-in-initial-meeting?highlight_post=3138971&page=1#p3138971 Best of luck to you!

Megan Hirlehey · Answer

Thank you all. Another question- What is reasonable to expect to pay for ongoing services? Like if I want more help than just filing taxes such as advising and strategy. Are these services usually fee based, or a percentage of earnings or something?

Nicholas Aiola · Answer

Megan Clancy I agree with the others that having a real-estate-savvy CPA as part of your team is important. What I find my clients appreciate the most is quick response time, honesty, transparency, and ability to communicate results/strategies. Above all, you have to find a CPA with whom you feel comfortable and who works best with YOU. Good luck on your search :)

Daniel Hyman · Answer

Experience in the industry (ie: most or all clients are real estate investors) Quick response timeQuick turnaround timePositive & upbeat

Colleen Arends · Answer

Megan, you sound like you are on the right path. Good luck. I'm going to follow to get similar questions answered.

Trevor Mathews · Answer

Megan,I am a virtual bookkeeper, so I spend a lot of time trying to find out what potential clients want in a potential bookkeeper which happens to be similar to what they want in a CPA.1. Getting the job done well and on time. Obviously, this is number 1. Watch out for CPAs who seem to overpromise when talking to them and have to proof to back up outrages promises. Finding a CPA who has a real estate niche is also great because they work with others like you.2. Find someone you can trust. I have skype conversations with all of my potential clients because when we can see each other, we both can get a better feel as to whether we will be a good fit.3. Promptness. If you agree upon a time to speak with a CPA and they show call you exactly at the time requested, there's a good chance they will be able to answer important questions ASAP down the road!Those are the three attributes I personally have found to be most important.Good luck with everything!