cpa faqtax accountants austin texas laura cannon cpa small business financials irs representation

cpa faq tax accountants austin texas laura cannon cpa small business financials irs representation

When do I need a CPA?

Many people choose a CPA to prepare their tax return when they become self-employed or receive Schedule K-1s from partnerships, LLCs, or S corporations.  Other complex tax issues not handled easily by common tax prep software include oil and gas investments, stock options, new IRC Section 199A deductions, and rental property.  Small businesses often use a CPA to prepare financial statements so they have accurate bottom line information throughout the year.

How do you bill for your services?

Our fees are based on the time it takes to complete your work.  Our billing rates range from $80 – 250 per hour, depending on the services being provided and the level of staff doing the work.

What happens if I get audited?

We’ll represent you before the IRS if you receive a notice or letter.  Most audits are merely requests for clarification regarding a specific line item on your tax return.  These can typically be taken care of via written correspondence or phone call, which minimizes our time. IRS representation is a separate engagement and will be billed accordingly.

I'm an independent contractor — what income do I have to report on my tax return?

All taxable income received must be reported on your tax return, regardless of whether you received a Form 1099-MISC or not.

How do I know if I need to make estimated tax payments?

Basically, estimated tax payments are required if you have income that has no tax withheld on it.  For example – investment earnings (capital gains, dividends, interest), gig income, small business income from sole proprietorships, partnerships, LLCs, S corporations, or rent houses that make a tax profit, could all result in the need for estimated tax payments.

Which is better — LLC or S Corporation?

This is a complex issue.  S corporations are best for those that want to save on self-employment taxes and don’t mind filing quarterly payroll reports.  LLCs are best for those who dislike the idea of filing quarterly payroll reports and are less concerned about minimizing self-employment taxes.  This analysis also needs to include discussion of employee health insurance, employee retirement plans, how to qualify for the IRC Section 199A deduction, and legal liability issues.