Accountants for small businesses range from a part-time bookkeeper who keeps your records current to a CPA who prepares tax returns and advises on major decisions. Knowing what each kind of professional does helps you pay for the support you need and avoid paying for what you don’t.
This guide covers the types of professionals, what they do, when hiring makes sense, how fees work, and how to choose. It is general information, not tax or legal advice.
Who Helps With Small Business Accounting?
| Role | What they typically do | Learn more |
|---|---|---|
| Bookkeeper | Records and organizes day-to-day transactions, such as expenses, invoices, and bank reconciliations | Bookkeeper vs. accountant |
| Accountant | A broad term. Many review your books, prepare financial statements, and advise owners. Qualifications vary, so ask. | Small business accounting guide |
| CPA | An accountant licensed by a state board of accountancy. Can prepare returns, prepare financial statements, and represent clients before the IRS. | CPA for small business |
| Enrolled agent or tax attorney | Tax specialists with unlimited IRS representation rights | Tax accountant guide |
| Tax preparer | Prepares returns. Credentials and representation rights vary. | Tax accountant guide |
What Does an Accountant Do for a Small Business?
Depending on the agreement, an accountant or bookkeeper may help you:
- Set up and review your books, including your chart of accounts
- Reconcile accounts and complete a month-end close
- Prepare or review financial statements, such as the profit and loss statement, balance sheet, and cash flow statement
- Handle payroll and payroll tax filings
- Prepare tax returns and plan for estimated payments and tax deadlines
- Build a budget and track performance against it
- Advise on accounting software and processes
Not every accountant offers every service. Our guide to small business accountant services explains what an engagement may include.
When Should You Hire an Accountant?
| Stage | Typical situation | Support to consider |
|---|---|---|
| Starting out | Few transactions, no employees | Accounting software, plus a one-time consultation if you have questions |
| Growing | More transactions, books falling behind | A bookkeeper, plus an accountant for year-end and taxes |
| More complex | Employees, several owners, multiple states, inventory, or a lender asking for statements | An accountant or CPA on a regular basis |
| IRS notice or audit | A letter from the IRS | A professional with unlimited representation rights (see our IRS audit guide) |
These are common patterns, not rules. A single big change, such as your first hire, can be reason enough to talk with a professional.
How Much Do Accounting Services Cost?
This guide does not quote standard prices, because fees vary widely. The main factors are the complexity of your business, how many transactions and returns are involved, the condition of your records, the scope of work, and the professional’s location and experience.
Professionals commonly charge by the hour, by a flat fee for a defined job such as a tax return, or by a monthly fee for ongoing work. Ask a few professionals for written quotes that describe exactly what is and is not included.
How to Find and Choose an Accountant
- Ask for referrals from other owners, your bank, or local business groups.
- Verify credentials. You can confirm a CPA’s license with the state board, and NASBA’s directory lists them. The IRS explains the credentials of tax professionals on its page Choosing a Tax Professional.
- Look for relevant experience with businesses of your size, industry, and structure.
- Compare the scope and fees in writing, not only the price.
- Check communication and software. Ask how often you will hear from them and which accounting software they use.
- Review the engagement letter before you sign. It should state the services, responsibilities, fees, and deadlines.
What You Still Own When You Hire an Accountant
Hiring an accountant does not transfer responsibility for your records and tax filings. You still need to:
- Keep receipts and invoices (see receipt management and tax recordkeeping)
- Keep personal and business money separate, starting with a business bank account
- Give your accountant complete and timely information
- Read and understand a return before it is filed
- Keep copies of what is filed
Questions to Ask Before Hiring an Accountant
- What are your credentials and experience with small businesses?
- Which services are included in your fee?
- Do you provide tax preparation, or only bookkeeping and reports?
- How do you charge, and what costs extra?
- Which accounting software do you use or support?
- How often will we communicate, and how often will I get reports?
- What information do you need from me, and by when?
- Can you represent me if the IRS contacts me?
Frequently Asked Questions
Do I need a bookkeeper or an accountant?
A bookkeeper keeps your day-to-day records current. An accountant reviews those records, prepares reports, and advises you. Many small businesses start with software, add a bookkeeper as transactions grow, and use an accountant for year-end and taxes.
Can I do my own bookkeeping?
Many owners do, especially early on, using accounting software. Our bookkeeping guide explains the basics.
How often should I meet with my accountant?
There is no standard schedule. Many owners meet around filing time, and some add check-ins during the year or after major changes such as hiring or expansion.
Is an accountant the same as a CPA?
No. “Accountant” is a broad term, and qualifications vary. A CPA is licensed by a state board of accountancy after meeting education, examination, and experience requirements.
Conclusion
The right accounting help depends on the size and complexity of your business. Start with what you actually need, check credentials, and get the scope and fees in writing. You can always add support as your business grows.
This article is general information, not tax or legal advice. Confirm your own situation with a qualified professional.
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