Updated · Angel Wallace, Advanced QuickBooks ProAdvisor
A bookkeeper records and reconciles your transactions and produces monthly reports. An accountant analyzes those records and often prepares returns. A CPA is a licensed accountant who can also represent you before the IRS. Most small service businesses need a bookkeeper all year and a tax professional at tax time.
I'm a bookkeeper, not a tax preparer. I work alongside your CPA.
What does a bookkeeper do?
- Records every sale, payment and expense in the right category
- Matches app payouts to the client payments and fees inside them
- Reconciles each bank, card and app account to its statement
- Produces monthly reports: profit and loss, balance sheet and a short note
- Keeps the books ready for the person who prepares your return
What does an accountant or CPA do?
An accountant works from the books to analyze, plan and, often, prepare tax returns. A Certified Public Accountant has passed the CPA exam and holds a license from the state.
Who can represent me before the IRS?
According to the IRS, CPAs, enrolled agents and attorneys have unlimited representation rights, which means they can represent a taxpayer on any tax matter. A bookkeeper does not. That is one more reason the two roles work together rather than compete.
Which one does a small service business need?
For a cleaning company, a dog walking business or a lawn crew, the usual setup is simple: a bookkeeper keeps the records current every month, and a CPA or other tax professional prepares the return once a year from those records. Clean books make that job faster for them, which usually makes it cheaper for you.
When owners skip the bookkeeping step, they end up asking tax questions without the numbers to answer them. One pet sitter on a public forum described "getting such mixed messages... One CPA said I could deduct... One cpa said I could not." Clear records will not settle every tax question, but they give your tax professional what they need to answer it.
What is a QuickBooks ProAdvisor?
A ProAdvisor is a professional certified by Intuit in its QuickBooks software. Advanced is the higher level of that certification. I'm an Advanced QuickBooks ProAdvisor, certified in QuickBooks Online at Level 2. It is a certification in the software, not a tax license.
Do bookkeepers and CPAs work together?
All the time. I keep your books reconciled and current through the year, then hand your CPA or tax preparer clean reports. If they need a correction or a detail, they ask me directly, so you are not stuck in the middle.
