What is the difference between certified public
accountants (CPAs) and accountants? If you get an
audit by the IRS, can both of them represent you?

A CPA has demonstrated professional competence by passing a rigorous examination and meeting high standards of education. In addition, they must meet strict continuing education requirements, undergo peer review, and adhere to a stringent set of ethical standards.

CPAs are authorized to represent taxpayers in an IRS audit, as are attorneys and other professionals known as enrolled agents (EA). An EA is an individual who has demonstrated technical competence in the field of taxation and are the only taxpayer representatives who receive their right to practice from the U.S. government. An accountant can only represent a taxpayer before the IRS if he or she is an EA.

How do I know if I can do my own taxes or if I need
to consult a certified public accountant?

The IRS estimates that it can take 28 ½ hours to research tax law, organize your records, and complete a standard 1040 return with three common schedules. Tax law is constantly changing, so it is important that you are educated about these changes so you correctly fill out your forms. Being technologically savvy is also important as tax preparation software can help eliminate errors, both mathematical and technical. If you're not comfortable with using this type of software, you may want to contact a CPA.

If you're a salaried employee who takes the standard deduction, your return is likely to be simple. However, if you've encountered a major life change, such as marriage or divorce, or own a vacation home or rental property, your tax situation may be more complicated.

Self-employed individuals and small business owners are more likely to be audited by the IRS, and working with a CPA will help lessen that risk. In addition, if you have a high income, live in a state with high income taxes, or have a lot of miscellaneous itemized deductions; you could be subjected to the Alternative Minimum Tax (AMT). The AMT, which eliminates many itemized deductions and was created to ensure that the wealthy pay their share of taxes, is now affecting more middle-class taxpayers. If you think this might affect you, consult a CPA.

The American Institute of Certified Public Accountants (AICPA) provided the answer to this question.

Should I consult a CPA if I am starting a new business?

I am starting a new fashion business that is costing me $10,000. We are a wholesale company, and we pay our employees 10-15 percent commission-based pay. Do you think we should start the sales of our products at $1,800 and up in order to make a profit? Companies purchasing our products must purchase at least three products from us, which will cost them $5,400. Do you think I need to sit down with an accountant?

It's impossible to say what the selling price of your product should be since there are innumerable factors that go into that decision, such as cost to produce or purchase the product, target gross profit on the product, the gross profit the market will bear for the product, overhead, etc. The price should be based upon your own internally generated factors. Do not shy away from a figure just because the price tag seems large. Large to you may not be large to potential customers.

It is imperative that you contact a CPA. You will need to discuss the organization of your company for tax purposes as well as numerous other issues relating to operations, not the least of which will be setting your target pricing and gross profit margins. Don't wait until the year-end to have this discussion. You could be making decisions without the proper advice, and that could wind up hurting you financially or legally.

How much should I have withheld out of my paycheck?

It depends on your financial personality. Do you prefer to have more withheld today so that you can get a refund next year? (This is really an interest-free loan from you to Uncle Sam.) Or are you disciplined enough to set aside some of your paycheck today and save it to pay your taxes next year? (You could invest the money in the meantime.)

It is also depends on your prior year tax liability. Do you know how to avoid an underpayment penalty situation?

We can tell you how to avoid the underpayment penalty and we can compute approximately how much you will get back or have to pay in.

Do I really need to pay a CPA to prepare my financial statements? Couldn't I save money by doing it myself?

First you need to ask yourself, “How valuable is my time?” Imagine what you could be doing to build your business with that time. Could you earn more than what a CPA would cost? The answer to these questions will change as your business grows.

Second, you need to ask yourself if you have the skills and the desire to do it yourself. Will you have to learn these skills? Will you have to keep yourself updated? Do you really want to crunch numbers? Do you want more than just a report when you are done?

How can I know which CPA is best for me?

Any professional you choose should not only have the technical knowledge required, but should also treat you with respect.

Does your CPA and advisor take time to listen to you? Does your CPA and advisor return your calls in a timely manner? Do you feel comfortable asking your CPA and advisor a question?

When you need a professional in the region who will make you their top priority, call us!

What do CPAs do?

A significant contribution of CPAs in the practice of public accounting is the audit, whereby an independent opinion is expressed as to the fairness of financial statements. CPAs also perform almost every conceivable financial and management advisory service for business and individuals. CPAs do general accounting, tax planning and advice, tax return preparation, estate planning, personal financial planning and representation of clients before government agencies. CPAs also help clients choose and implement accounting systems. They help in the development and analysis of financial models, cost controls, profit plans, and internal reports. CPAs are often consulted on business, civic and other problems on which their judgment, experience and professional standards permit them to provide helpful advice and assistance.

Are there things I should consider before I talk to you
about being my CPA?

Yes. The more you understand about your needs, the better
job we can do together of matching our services to those needs. Your first step is to decide what you want from your
us. Different CPA firms offer different levels of experience and provide different services. Prior to meeting with any CPA you are considering you should review your present and future financial goals and needs. Some general questions you should ask yourself might be:

 Will you need help with personal financial issues, 
individual or corporate tax returns, retirement, estate 
or college planning? Are you seeking investment help?

 Do you need financial statements prepared for your 
business? Must those statements be audited or 
reviewed? Will you need special financial reports for 
government agencies?

How comfortable are you in your own ability (or in 
the case of a business, your staff's ability) to handle 
financial and operational details. Do you want to do 
as much as possible in-house or are you considering 
out-sourcing some of your bookkeeping, accounting, 
or CFO functions?

Do you need help preparing a business plan or a 
personal or business loan application?

Will your business need other services such as
technology planning, strategic planning, process 
consulting or costs analysis?

 What is your budget for CPA services?

How much do you charge?

We base our fees on a number of factors including the type of services required, the time required to perform the services, the level of expertise and experience required, and the complexity of the work. The fees at Riani & CO LLC. fall into three categories.

Hourly based fees — For much of our work we are 
compensated based on the numbers of hours it takes 
to complete the work. We are happy to quote our hourly 
rates and to provide fee estimates for specific tasks.

Task based pricing— Our payroll processing service 
is priced based on the number of pay periods per month, 
the number of checks in each pay period, and the costs 
of any expenses (such as delivery fees).

Fixed fee services— For some longer term projects 
or commitments such as monthly write-up we charge a 
fixed fee

Different types of services command different rates because of the expertise level of the people who perform them. We will talk frankly with you about our fees and put together a plan that utilizes the right CPA or staff person for the services you need so that the value of the service and the price of the service make sense for you.

How do I know what exact services you will perform
and what they will cost?

We use engagement letters that define the work and the associated fees before any work is performed. The letter is designed to prevent any misunderstandings and describes in detail the services to be rendered, fee ranges and other terms and conditions of the engagement. It is a contract determining our responsibilities and your responsibilities and sets both of our expectations for a successful relationship.

How can Riani & CO serve me, my business
or governmental entity?

We can help by:

Recommending tax planning strategies 
Preparing tax returns 
Advising individuals on personal financial planning, 
including retirement and estate planning 
Reviewing a company's accounting system and 
recommending improvements 
Consulting on business problems and advising ways 
to improve the use of a client's resources 
Assisting in the design and installation of data processing 
and management information systems 
Conducting special studies (financing, inventories, cost 
accounting, credit, and collection) for business, 
government, and nonprofit organizations 
Helping clients apply for loans and credit by gathering 
and preparing information required by lenders 
Working with clients, attorneys, and bankers on mergers, 
acquisitions, and expansions

What do CPAs and Advisors at Riani & CO do?

Our team acts as advisers to individuals, businesses, financial institutions, not-for-profit organizations, and government agencies on a wide range of financial matters. Many individuals turn to CPAs for help not just with their tax preparation, but also with their business and personal financial planning.

Most CPAs meet substantially the same education, training and licensing requirements. Nonetheless, they provide a broad and varied range of services. We specialize in small business, tax or financial planning, audit/assurance services, to name just a few.

In order for you to get the most value from any CPA relationship it is important to first analyze your current and future financial needs. This will help you to select someone
who can address your particular concerns.

How can Riani & CO help my family and me?

We can help…

Develop a personal financial plan 
Create a family budget 
Plan for retirement 
Develop an estate plan 
Assess insurance needs 
Advise on divorce settlements 
Devise savings and investment strategies 
Build college funds

How can Riani & CO help me as a taxpayer?

We can help…

Develop tax strategies 
Prepare tax returns 
Minimize tax liability

How can Riani & CO help me as a business
owner?

We can help…

Set up accounting systems 
Secure financing 
Analyze operating results 
Provide management consulting services on such 
subjects as data processing systems 
Develop budgets and business plans and forecasts 
Prepare tax returns 
Audit, review, or compile financial statements 
Assess benefit and compensation plans

What can I do to get the most value out of a
relationship with Riani & CO?

The primary step is to commit to a partnership with us. While we believe we are very good at what we do, we are only as good as the information we have. For our relationship to be successful for you, you need to:

Be prepared to discuss your plans, goals, problems, 
and questions. We can most effectively advise you 
and serve your best interests when we understand 
your goals.

Gather all relevant personal and business financial 
information so we can get anaccurate picture and 
ask specific questions.

Be clear and candid about what you expect from 
our services.

Keep us informed of changes in your professional 
and personal life. A marriage or divorce, the birth 
of a child, an inheritance, a career change, or a 
generous bonus can have a significant impact on 
your tax liability and financial goals.

Be open to new ideas, tools, and opportunities

And, of course, you need to make sure you (or your 
staff) meet your commitments to deliver appropriate, 
accurate, and timely information so that we have the 
information we need when we need it