What CPAs Do (and Don’t Do): A Candid Talk About Tax Strategy, Bookkeeping, and Small Business Survival

• Tim: Small business owner, curious and skeptical about CPAs
• Linda: Experienced accountant with strong opinions about how CPAs operate
• Gene: Small business financial analyst and strategist

Most CPAs focus on tax filing, not tax planning. They often take your income statement and balance sheet at face value, without verifying entries or offering advice unless asked.

CPAs Bug Me!

Tim: All right. I want to ask you both something that’s been bugging me: what’s the deal with CPAs? I’ve worked with a few and, honestly, I’m not sure they’re doing much more than plugging in numbers. Linda, you’ve worked with CPAs on the accounting side—what’s your experience?

Linda: Honestly? Not that great. Most CPAs I’ve dealt with are really focused on just one part—the tax return. They rarely dig into the day-to-day accounting. They assume the books are clean and just grab the income statement and balance sheet, plug those into their tax software, and move on.

Tim: So, they’re not checking if the numbers are even correct?

Linda: Not usually. If something is categorized incorrectly, unless it’s glaringly wrong, they won’t flag it. They just input what they’re given.

Do CPAs Care?

Tim: But shouldn’t they care? Isn’t that part of their job?

Linda: You’d think so, but no. Most see their job as filing the tax return. They’re not reviewing your books unless you pay extra for that.

Gene: Linda’s right. The industry norm is that tax preparation assumes the books are accurate. CPAs aren’t auditors. Their job isn’t to verify every entry unless you hire them for a review or audit. They’re focused on compliance, not optimization.

Tim: That’s wild. So how’s a small business supposed to know if something’s wrong or could be improved?

Mind The Gap

Gene: That’s the gap. Most CPAs aren’t proactive. They don’t offer tax-saving strategies unless asked—or paid—for it. That’s why many small businesses leave money on the table.

Tim: Then why do we even need CPAs? If they’re just copying numbers from a balance sheet into software, couldn’t the software just do that itself?

Linda: That’s what it feels like. A lot of the time, it’s a glorified data entry process.

Gene: Technically, yes, software could do it. But CPAs are needed because they’re licensed to file tax returns and are legally responsible if something goes wrong. If you’re audited, they can represent you. Software can’t.

Tim: That makes sense. Still, if the CPA isn’t catching errors, isn’t that risky?

Gene: Exactly. If your books are off, your return could be too. That’s why you need a clean set of books to start with—and someone who can give you proactive advice.

It’s In Your Books Where Money Can Be Saved

Tim: So, Linda, have you ever caught things on the accounting side that saved a client money?

Linda: Sure, especially when reclassifying expenses. If you can log something as cost of goods instead of just a general expense, it can change the tax outcome. But I don’t always know the tax implications. That’s where the CPA should step in—but they often don’t.

Tim: Sounds like what’s missing is strategy. Is there a way for someone like me—who’s not a finance expert—to fix that?

Tips For Business Owners

Gene: Definitely. Here are some tips for business owners:

1. Keep clean books—Use software like QuickBooks or Xero and categorize everything properly.
2. Separate personal and business accounts—Avoid commingling.
3. Time your income and expenses—Buy equipment in December if you want the deduction this year.
4. Understand deductions and credits—Track everything, especially mileage, home office, and subscriptions.
5. Consider retirement plans—Solo 401(k)s or SEP IRAs can reduce taxable income.
6. Pick the right entity—S-Corp can save on self-employment tax if set up properly.
7. Talk to your tax advisor mid-year—Not just in April.

Tim: That all sounds good, but also like a lot. Are there tools that can help without needing a full-time finance team?

Tools For Business Owners and Bookkeepers

Gene: Absolutely. You’ve got options:

Bridging The CPA GAP

Most CPAs focus on tax filing, not tax planning. They often take your income statement and balance sheet at face value, without verifying entries or offering advice unless asked.

Tim: So, I could use something like Bench or Collective, skip the CPA until I really need one, and still be covered?

Gene: Exactly. You get clean books, tax filing, and even advice if you choose the right service.

Linda: And if you still want a CPA for filing, at least you’re handing them clean, categorized data. That alone improves the odds of a better return.

Tim: This is exactly what I needed. Thanks to both of you. I feel like I finally understand how to bridge the gap—and not overpay Uncle Sam while I’m at it.

Gene: That’s the goal. Don’t just file—plan. The right tools and strategy can save you thousands.

Don’t Just File—Plan. Why Good Books and Smart Tools Matter More Than Ever

Key Takeaways from the CPA Conversation

• Most CPAs focus on tax filing, not tax planning. They often take your income statement and balance sheet at face value, without verifying entries or offering advice unless asked.

• There’s a critical “strategy gap” between bookkeepers and CPAs. Many small business owners assume their CPA is optimizing their taxes—but in reality, most CPAs are reactive, not proactive.

• Software can handle bookkeeping and even tax prep—but not judgment. While automation is improving, a good CPA still plays a role in legal compliance and audit defense.

• Business owners must be proactive. The best way to reduce tax liability isn’t during filing season—it’s through year-round planning, smart categorization, and choosing the right entity and tools.

• Modern solutions are bridging the gap. Services like Collective, Bench, Pilot, and Keeper Tax offer bookkeeping + tax advisory combos that minimize reliance on old-school, form-filling CPAs.

• A hybrid model is ideal. Use software for the heavy lifting, then bring in a tax advisor or fractional CFO for high-value strategy and oversight.