How and Why I Hired My Tax Accountant

Until I owned my business, I had always prepared my own income-tax returns. No longer. I’m glad to say that I have an accountant.

Finding the right person wasn’t easy. It took me time and some personal evaluation to decide on the best one for me. Here’s the process I went through.

First, I considered doing my own taxes — for about a nanosecond. I had always prepared my tax returns. Since I had only my income, and then my wife’s, to report, the process was straightforward. A couple of hours using tax software, and I was ready to file with the Internal Revenue Service.

That changed when I bought my hobby-and-game store. The complexities of owning a business and all the tax rules that come with it made the job much more difficult.

I realized this after spending hours on the phone with various city and state agencies trying to compile the tax-identification numbers needed to apply for a bank loan. I was astonished by how many taxes a small-business owner has to pay. Assessments may be levied at the city, county, state and federal level, and the rules and regulations change frequently. Complicating matters, a separate identification number is required for each tax. Failing to file just one of the returns triggers a penalty, something I didn’t dare risk.

In short, I quickly concluded this was no job for an amateur. Plus, for small-shop proprietors like me, time is money, and unless I hired a professional, I’d be doomed to taking the latest tax-preparation class instead of focusing on my business.

By JOHN CANTER

Full Story: http://www.startupjournal.com/columnists/entrepreneursdiary/20050224-canter.html?sjcontent=mail