Before the meter starts · checked 18 August 2026
Everything on this site that an accountant would otherwise charge you an hour to explain.
In short
What should I ask an accountant, and what should I already know?
Nine things to settle before the meeting, the questions worth the hour, and four answers that should end the interview
3 credentials that can represent you in an auditA first meeting with an accountant goes one of two ways. Either you spend the first half of it being taught what is already written down, or you arrive knowing it and spend the whole hour on the parts that are actually about you. This page is the second version: what to settle before you book, what to ask, and the answers that mean this person has never had a California licensed therapist as a client.
Check the credentialKnow this firstWhat to askWrong answersWhat to bringSources
Start here, because almost nobody does
Not everyone who prepares tax returns for money is a CPA, and the difference shows up in an audit.
In California, anyone who prepares or assists in preparing tax returns for a fee has to register with the California Tax Education Council unless they are exempt. The exempt list is short: California CPAs, enrolled agents, attorneys who are members of the State Bar, and specified banking or trust officials. Everyone else must complete a 60-hour qualifying course, carry a $5,000 tax preparer bond, and renew each year with 20 hours of continuing education — ten of federal tax law, three of federal update, two of ethics and five of California tax law.
Separately, the IRS requires that “anyone who prepares or assists in preparing federal tax returns for compensation must have a valid” preparer tax identification number for the year. A PTIN is not a credential. It is a registration number, and on its own it carries almost no authority.
What each one can do if the IRS comes back to you
| Who they are | What they can do for you before the IRS |
|---|---|
| Attorney, CPA, or enrolled agent | Unlimited representation. Any matter — audits, payment and collection, appeals — whether or not they prepared the return. |
| Annual Filing Season Program | Limited. Only returns they prepared and signed, and only before revenue agents, customer service representatives and similar staff. Not appeals. Not collection. |
| PTIN only, no credential | Effectively none. They may prepare your return and cannot represent you on it, other than for returns prepared before 1 January 2016. |
From the IRS’s own description of preparer credentials, read 18 August 2026. The distinction costs nothing on a quiet year and everything on a bad one.
Two searches, four minutes, before you send anyone your books
A CPA license is on the same California license search you use for your own — the Department of Consumer Affairs covers Accountancy and Behavioral Sciences in one place, and shows whether a license is current, expired, suspended or revoked. A registered preparer who is not a CPA is on the Council’s own register instead, and the IRS publishes a directory of credentialed preparers.
Both links are in the sources below. Registrations expire and licenses get suspended, and neither event sends you a letter.
Do not pay to be taught these
Nine things this site already answers, so you are not buying them by the hour.
None of this is advice about your situation, and an accountant who knows your numbers may tell you something different about any of it. The point is narrower: walk in already knowing the shape of the question, so the hour goes on your answer rather than on the background.
Not a preference — a statute. The choice is sole proprietorship or a California professional corporation, which may then elect S-corp treatment. The subsection that forbids it →
It costs something every year whether or not it earns anything, and there is a first-year rule. Below a certain profit the structure costs more than it saves. The floor, and where it starts paying →
It buys a tax saving now and sells future Social Security to pay for it, and the trade can be priced rather than argued about. What the trade actually costs →
The pitch is usually made in federal terms only. State employer costs are real and one of them has no wage cap. The costs the pitch omits →
The state schedule is front-loaded and does not match the federal one, which is the single most common way a first year in practice goes wrong. Both schedules, and the safe harbour →
Which is why “write it off” is not a plan. What qualifies, and what it is worth → · The home office, both methods →
At a given profit one of them takes far more than the others, and the right answer changes as the practice grows. The three, at three profit levels →
The pro-rata rule looks at every one of your traditional IRA balances, and the deadline is the end of December, not April. Why yours was taxable →
And the cost question has a break-even caseload. The loaded cost and the rule →
If you want the whole thing priced end to end before you go in, that is the tax strategy page, which puts a number on how much of the bill is actually optional.
The hour itself
Questions worth an accountant’s time, because the answers depend on facts only they will have.
Structure, and whether to change it
- At my profit, does a professional corporation clear its own annual cost, and by how much — after California payroll, not just the federal saving?
- If we incorporate, what does the first year cost in filings and fees that the second year does not?
- What salary would you set, how did you arrive at it, and what would you show if that figure were ever questioned?
- What happens to this if my income drops for a year — what does the structure cost me then, and how hard is it to undo?
The rhythm of the year
- What am I sending, to whom, and on what dates — federal and California, which are not the same schedule?
- Which safe harbour are you aiming me at, and what happens if I have a much better year than last year?
- Who actually presses send: you, or me? Say it out loud now, because this is the thing that gets assumed in both directions.
- If a notice arrives, what do you do and what does it cost? Their answer here is where the credential above stops being theoretical.
Retirement, which is where the real money is
- Given my profit and whether I have employees, which plan takes the most — and what is the deadline to open it, as opposed to the deadline to fund it?
- Do I have any traditional IRA balance anywhere that would make a backdoor Roth partly taxable, and what would you do about it before December?
- If I hire someone, which of these plans forces me to cover them too, and what does that cost per employee?
Records, and the part that is specific to this work
- What are you going to need from me that identifies my clients — and can we do this with figures rather than names?
- How do you receive and store documents? A superbill carries a client’s name and a diagnosis code, and email is where that usually goes wrong.
- Who else at your firm sees my file, and are they bound the same way you are?
- If I am ever audited, what of mine gets handed over, and do I get to see it first?
That last group is not a tax question and a general accountant may never have been asked it. It is worth asking anyway: what you hand over is client material, and what a superbill has to contain is why. An accountant who takes the question seriously is telling you something useful about the rest of the relationship.
How to tell in ten minutes
Four answers that mean this person has not done this for a California therapist.
This is the one that should end the interview, and it is the most common advice a therapist gets. A California-licensed marriage and family therapist, clinical social worker, professional clinical counselor or psychologist cannot form one to deliver licensed services. Someone who opens with it has confused your profession with a consultancy, and everything downstream of that assumption is also wrong. The statute →
The figure matters less than whether they can say how they got there and what they would show if it were challenged. “Everyone uses this” is not a method.
That is the federal shape. California’s is not, and a practice that pays evenly into the state has underpaid twice by June. The two schedules →
If the pitch has not mentioned California employer payroll, the number is bigger than the reality. Ask them to redo it with the state costs in. What they are →
None of this makes a generalist a bad accountant
Most accountants have never had a licensed therapist as a client, and the entity rule genuinely is unusual — it surprises lawyers too. The point of the four above is not to catch anyone out. It is that you can find out in the first ten minutes whether you are the one who is going to have to teach them, and decide knowingly whether you mind.
The practical part
What to have with you, and what to settle about the fee.
What to bring
- Last year’s returns, federal and California, and any notice you have received since.
- A profit figure for this year so far, and an honest guess at the full year. Everything above depends on it and nothing can be answered without it.
- Whether you have employees or contractors, and whether any of them is pre-licensed.
- Every retirement account you hold, including old ones you have stopped thinking about — that is what the pro-rata question turns on.
- Your license type and status, because the entity question depends on it.
On fees, ask how they charge and what changes the number — a return, payroll for a corporation, and answering a notice are three different pieces of work and are often priced separately. This page deliberately quotes no fee range: what accountants charge could not be traced to a primary source, and a plausible-looking made-up range would be worse than nothing on a page whose whole promise is that every figure comes from somewhere. Ask two or three, and compare what they said about the entity question while you are at it.
Where every figure came from
Sources.
Who may prepare a return for a fee, and what they may do
- California Franchise Tax Board on the California Tax Education Council - who must register, who is exempt, the $5,000 bond, the 60-hour course and the 20 hours of continuing education
- The IRS on preparer credentials - unlimited representation for attorneys, CPAs and enrolled agents; limited for the Annual Filing Season Program; effectively none for a PTIN-only preparer
- The IRS on who needs a PTIN
Where to check somebody before you hire them
- California Department of Consumer Affairs license search - Accountancy and Behavioral Sciences in one place, with license status and discipline
- The Council's own register, for a preparer who is not a CPA, an enrolled agent or an attorney
- The IRS directory of federal tax return preparers with credentials and select qualifications
The figures above, each on the page that computes it
- Why a California therapist cannot use an LLC, and the two structures left
- What a professional corporation costs to run every year
- What a low S-corp salary costs in Social Security later
- The California employer payroll costs the S-corp pitch leaves out
- The two estimated-tax schedules and the safe harbour
- What is deductible, and what a deduction is worth
- The home office, both methods
- Solo 401(k), SEP and SIMPLE at three profit levels
- The backdoor Roth pro-rata rule and the December deadline
- The whole tax bill priced, and how much of it is optional
- Hiring an associate: classification, loaded cost and break-even
- What a superbill and a Good Faith Estimate have to contain
The preparer rules above were read on 18 August 2026 from the Franchise Tax Board, the California Tax Education Council and the IRS, and the link beside each is the authority rather than this page. Every other figure on this page is carried from the page on this site that computes it, and introduces nothing new. This site earns nothing from any link here and does not recommend or receive anything from any accountant, firm or directory. Nothing here is tax or legal advice, and a question is not an answer - the whole point of the page is that the answers depend on facts only you and your accountant have.
