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Choosing a tax advisor for your small business

In your search for the right tax advisor, it’s important to carefully explore your options, according to Gene Fairbrother, a nationally recognized small business expert and consultant. Fairbrother says that choosing the right tax advisor will set you on a clear course to profitability and save you headaches down the line.

“Not all tax advisors are created equal,” Fairbrother says. “And finding an advisor who’s truly committed to your business success is absolutely paramount.” For that reason, he says, selecting the right advisor should be a process not unlike selecting a full-time employee who’s the right fit for your business.

Tips for choosing the right tax advisor

Write a job description.

Hiring a professional is no different than hiring an employee. Outline specifically what you want them to do. Are you expecting your candidate to accept regular bookkeeping responsibilities? Are you looking for an advisor to help you make your financial planning decisions? Or are you looking for someone to prepare your year-end federal taxes and financials?

Be your own recruiter.

Once you have ferreted out a few good candidates, interview at least three or four before making a decision.
  • What is the candidate’s educational background?
  • What qualifications does the candidate have? (The person who does your income taxes may or may not be the right person to best identify the tax needs of your business.)
  • How long has the candidate been doing tax advising?
  • Will he or she provide at least three references of current clients?
  • What is the evaluation process they go through and how long does it take?
  • Have they been cited by any professional or regulatory body for disciplinary reasons?
  • How and what do they charge?
  • Do they provide ongoing reviews and planning strategies for you?

Ask questions.

Don’t let any professional intimidate you, Fairbrother says. “If you get the impression they think they’re above answering your questions, don’t waste your time and money on them.”

Match personalities.

It’s important for your personality and that of the people you engage are in sync. It’s not unusual for a professional to have a great relationship with one client and not satisfy another. The problem could be a simple personality clash.

Communicate.

“If you dump your whole financial future in the hands of a tax advisor without ongoing communications, you’re asking for trouble,” Fairbrother says. “Nobody is going to have as much interest in the financial future of your business as you. Make sure you have a strong line of communications with your advisor.”

Demand results.

“If you don’t like the gas station down the street, what do you do? You go someplace else. It’s no different with a tax advisor,” Fairbrother says. “If you don’t like the way they do business or the results they get, fire them and find someone else.”

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