25 Questions Everyone Should Be Asking Their Accountant According to Financial Pros

Many people successfully manage their finances on their own without the need for professional assistance. However, consulting an accountant is the best way to make the most of your money, no matter what your financial situation may be.

I had to learn the hard way. After transitioning from a freelancer to an online business owner, I thought I had all my finances figured out. What I didn’t plan for was business growth and how this affected my business structure, tax obligations, and financial goals. My accountant helped clarify topics beyond my knowledge, and I’ve been consulting with them yearly since.

We reached out to some licensed financial professionals to get their take as well, and asked what they feel clients should really be asking! In order to make the most of your finances, the following are some important concerns to raise with your accountant. 

1. What Upcoming Legislation Do I Need To Be Aware Of?

It’s hard to keep up with new or revised state and local tax laws, business accounting standards, Internal Revenue Service (IRS) rules, and other financial legislation. 

Accountants are on top of what’s happening in the industry—it’s a major part of their job. They should be able to explain any legislative changes that could impact you or your business. With their help, you can make informed financial decisions and comply with legal requirements.

2. How Can I Optimize My Tax Deductions?

Identifying eligible deductions and credits is integral to achieving a person’s or business’s long-term financial plans. They can lower taxable income and reduce overall tax bills, but not everyone knows how to execute it. 

Accountants can recommend tax-saving options that fit your current situation while ensuring compliance with tax law and minimizing the risk of tax-based penalties and audits.

Arielle Tucker, CFP & EA, explains:

“As an enrolled agent (EA) who has the privilege of representing taxpayers before the Internal Revenue Service and a Certified Financial Planner(TM), I look holistically at my client’s tax and financial planning situations. Here are some questions I encourage my clients to ask potential accountants they interview:

1) Can You Share Your Experience with Similar Clients?

This is especially important if you have a unique situation like real estate, business or complex compensation considerations. Finding an accountant who specializes in your situation means they have the experience to report the information correctly and save you money by spending less time researching and may see reporting errors.

2) What Technology Tools or Software Do You Use for Tax Preparation?

A tax accountant’s efficiency often relies on the tools and technology at their disposal. Inquiring about the software they use provides insights into their commitment to streamlined processes and accuracy. Additionally, it helps gauge their ability to adapt to digital advancements in the accounting field. Be sure you are filing electronically (required by the IRS) and receive an electronic copy of your tax return at the end.

A good follow-up question to this is,

2a) What security measures does your firm implement? You are sharing a lot of personal information with your accountant; be sure they are utilizing secure file sharing and other best practices to keep your personal information secure.”

3. How Frequently Should I Consult With You?

Most people should consult an accountant at least once a year when filing their tax returns. Some have complex financial situations that would require quarterly meetings with an accountant. Ultimately, you should determine the frequency of your consultations based on your personal or business requirements. 

Brenna Baucum, CFP, CTS, sheds some light on the situation by telling us:

“My happiest clients typically have three pillars to their professional team: an accountant, a CFP, and an attorney. I recommend clients ask their accountant whether they’re willing to collaborate with their financial planner.

Tax planning is more than a once-a-year activity; a planner can often provide proactive support to mitigate tax issues before they arise, but they don’t have the depth of knowledge a CPA does. Partnering can provide amazing value for clients.”

4. How Can You Help Me Grow My Money?

Accountants provide tailored insights on investment opportunities and strategies based on your financial goals and risk tolerance. 

Consulting with an accountant helps you build a balanced investment portfolio, maximizing money growth. They ensure tax efficiency by structuring investments to minimize liabilities and maximize after-tax returns, boosting overall wealth growth.

If this is your first consultation with an accountant, asking this question also gives you a good idea of their competency. 

5. What Financial Statements Should I Review Regularly?

For people overwhelmed and lost on where to start their financial planning, accountants could give them a list of documents to compile and review. 

Regularly reviewing your financial statements like income statements, balance sheets, and cash flow statements help monitoring business performance, identifying trends, and improving profitability. 

If you don’t have a business, financial statements can still offer insights for decision-making on budgeting, investment, and effective resource allocation. 

6. How Should I Prepare for Tax Season?

An accountant can file and remit your tax liabilities on your behalf, or you can do them yourself. Either way, consulting an accountant ensures compliance with tax laws and avoids penalties and stress related to tax season. 

Well-organized records expedite tax preparation, saving time and potentially reducing costs. Ask your accountant what you need to gather information and how to streamline record-keeping. 

Terry Parham Jr, Certified Financial Planner & Founder at Innovative Wealth Building, suggests:

“Inquire about way to lower taxable income and to move yourself to a lower effective tax rate. This could include: the use of retirement accounts, deferring certain forms of income, utilized tax-advantaged vehicles (HSA, 529, etc.) or even restructuring your compensation in order to achieve more net income after taxes.”

7. Can You Help Me With Tax Planning for a Major Life Event, Such as Marriage or Divorce?

Consulting an accountant for tax planning during major life events like marriage or divorce is crucial. What is more crucial, is figuring out if the professional you are considering working with has the expertise to successfully advise you through specific situations. With the right accountant’s recommendations, you can better execute tax-saving strategies and ensure transition stability.

Kelly Klingaman, CFP, RLP, explains:

“One of the top questions I encourage people to ask when interviewing financial advisors is, “What expertise do you have in working with clients like me?” This is a fair question to ask an accountant you might hire to prepare your tax return, too, especially if your situation is more complex.

Perhaps you’ve got complicated equity compensation, you manage investment properties, or you’re a business owner – all of these things mean your tax preparation is more involved than someone who receives a W-2 salary from a company. Financial professionals often attempt to be all things to all people rather than focus on a niche, so look for an accountant who has built their business entirely around the needs of someone like you.”

8. How Can I Improve My Credit Score After Recovering From Major Debt?

Going knee-deep in debt can be hard. If you’ve successfully got out of debt and need assistance starting from scratch, an accountant could help rebuild your credit score. 

Accountants can conduct a thorough credit analysis, identifying factors affecting scores. They can assist in creating a tailored long-term financial plan focusing on budgeting and credit-building techniques. 

9. What Tax Obligations Do I Have for Receiving Inheritance?

You must consult an accountant about the tax obligations associated with receiving inheritance. This way, you can navigate the complexities of tax law, minimize tax liabilities, and ensure compliance with legal requirements.

If the inheritance involves a sizable estate, accountants can also assist in preparing and filing estate tax returns.

10. Can You Help With Student Loan Interest Deduction?

If you’re paying interest on your student loans, you may be eligible to deduct the student loan interest from your federal income tax. Borrowers can subtract up to $2,500 of interest paid on qualified student loans from their taxable income.

While this tax break sounds good, it could confuse many individuals with student loans. Accountants can clarify eligibility criteria. They can also assist in calculating the deductible amount and ensure accurate reporting on tax returns. 

11. What Strategies Should I Use To Improve Cash Flow Management?

Every business owner should consult an accountant to learn about effective cash flow management, covering obligations, and fostering growth.  

Accountants are finance experts who can offer tailored advice based on your specific circumstances. They analyze income, expenses, and cash flow patterns, recommending optimization strategies like expense reduction or revenue increase.

12. Are There Tax Consequences to Debt Forgiveness?

Debt forgiveness may result in taxable income, potentially leading to unexpected tax liabilities if not properly accounted for. Accountants can advise you on how to report forgiven debt on tax returns. Doing so ensures compliance with IRS regulations and avoids penalties.

13. Can You Help Me Grow My Business?

For your business to grow, you’ll need the financial expertise of competent accountants. They can analyze your financial statements and performance metrics to identify strengths, weaknesses, and areas for improvement. 

Accountants assist in budgeting, forecasting, and investing. They can advise you on managing debt, accessing capital, or changing your business structure to adapt to the current market. 

14. What Business-Related Expenses Can I Deduct?

If you’re a business owner just starting, you can benefit from the expertise of accountants. 

Accountants can guide you through eligible deductions, such as costs for operating and maintaining your business, purchasing equipment, marketing and advertising expenses, professional fees, rent or mortgage payments for business premises, travel expenses, and employee salaries or benefits. 

15. What Do I Need To Know About Paying Estimated Taxes?

Asking accountants about paying estimated taxes ensures your tax payments’ accuracy, compliance, and optimization. 

Accountants can accurately calculate the estimated tax amount you owe based on your income, deductions, and credits. It reduces the risk of underpaying, overpaying, or even forgetting your tax obligations. 

16. What Should I Consider When Tax Planning for Real Estate Investments? 

If you have real estate investments, there are some tax considerations you need to know. For example, if you invest in rental properties, the income generated from rental payments is subject to taxes.

If all the tax planning confuses you, consult an accountant to clarify your questions. Accountants can also advise on the optimal structure for real estate investments, managing capital gains taxes, optimizing rental income, and complying with IRS regulations. 

17. How Can I Keep My Financial Data Secure?

Accountants aren’t just about crunching numbers. They can help keep your financial data secure by implementing secure accounting software and encryption. 

Aside from setting up cybersecurity and training employees to handle financial data securely, accountants ensure you or your business comply with data protection regulations.

18. Can You Recommend the Safest Investment Option for Me?

Not all investments will fit your risk tolerance, financial goals, and preferences. Accountants can assess these factors, recommend investment options that align with your risk profile, and help minimize the risk of capital loss.

Accountants could also advise on diversifying your investment portfolio, capital preservation, and long-term financial planning. 

19. Do I Need To Pay Anything After Receiving a Commission or Bonus?

If you just received a significant commission or bonus, an accountant can help you understand payroll taxes, income taxes, and other tax implications of such a payout. 

Accountants can also calculate tax liabilities and ensure compliance with relevant tax laws and regulations.

20. How Can I Minimize My Self-Employment Tax?

If you’re self-employed, having a trusted accountant is a privilege. Accountants can identify deductible business expenses, credits, and deductions that can offset self-employment income. 

Minimizing self-employment tax allows you to retain more earnings to reinvest in your business, fund personal expenses, or pursue other financial goals. 

With that said, it is important to ask your accountant whether saving now, could end up costing you down the line.

As Freeman Linde, CFP, EA, puts it:

“Accountants can often be short-sighted, looking in the rearview mirror at last year and trying to maximize single-year tax savings. You should look out the windshield to determine how much you’ll pay in total. What should you be doing to minimize lifetime taxes? We’ll pay the IRS every dime we owe them, but let’s not them a tip.”

21. What Triggers an IRS Audit?

Accountants can help you understand the factors that may increase your likelihood of being audited by the IRS, such as high deductions or fluctuations in income. 

Knowing what triggers an IRS audit and being proactive in addressing potential audit risks gives you more time to focus on your business or personal finances. 

Garrett Harper, CFP, explains: 

“For home office deduction users, question your CPA as to what the total amount of the deduction is and also ask to brainstorm if there are potential expenses that you have that you are not currently deducting from your income that can be used instead of the home office deduction. The home office deduction is overused in many cases, therefore, it tends to draw scrutiny and the potential for an IRS audit.”

22. What’s the Best Way to Finance Future Growth or Expansion?

Accountants could assess your current financial situation as a business owner or individual planning for future financial growth. 

Accountants can walk you through the pros and cons of debt financing, equity financing, or other sources of capital so you can make an informed decision that fits your business goals and growth plans the best. 

As Terry Parham Jr, CFP, suggests:

“Discuss the role of tax planning in your retirement strategy. Many parts of a person’s financial situation are interconnected, so it’s important to develop your tax strategy in conjunction with your other financial strategies vs. taking a siloed approach. The focus should be on long-term (perhaps lifetime) tax efficiency/ savings vs. just maximizing tax savings for one particular year. ”             

23. Am I Making Any Mistakes?

Accountants possess expertise in tax laws, accounting principles, and financial regulations, allowing them to identify errors or discrepancies in your financial records or tax filings. 

You can promptly rectify mistakes and avoid potential penalties or audits by consulting with an accountant. Fixing errors maintains financial integrity and transparency if you’re running a business.

24. What Are My Financing Options for X?

Accountants can evaluate your financial options for various purposes. They can help you analyze your financial situation, goals, and available resources to provide recommendations tailored to your specific needs and objectives. 

Whether choosing investment strategies, financing options, or budgeting plans, accountants can offer valuable insights and guidance to assist you make informed decisions and achieve your financial goals.

25. How Can I Streamline My Bookkeeping Processes?

Accountants utilize the best software tools, personal finance apps, and accounting practices for efficient bookkeeping. Accountants can assess your methods and identify weak points if you already have a bookkeeping process. They can then recommend strategies—such as automation—to streamline processes.