Late-season price shoppers

[FDNY]

10 minutes ago, michaelmars said:

Initials don't mean anything, there is book smart and real life smart. All it means is that at some point in time someone learned some book knowledge and regurgitated it at test time.  It does show the person has the ability to learn but not to retain or apply the knowledge.

By best preparer never passed the exam nor bothered going for EA but he thinks about every entry and is very smart.

A CPA can prepare financial statements, it has nothing to do with taxes.  I took some tax classes that mostly dealt with theory. Never saw a tax form in school.

-Michael CPA, MA, BS, BA.    [ oh yeah, EMT, CPA, 1st Dan Ju Jitsu, and according to my staff a real PIA]

Don't be so modest, you're a great EMT, worked in a rough area and most likely saved lives.

[Lion EA]

Calm down everyone.  My response was in answer to Rita who said even the CPAs don't charge as much as HRB (which does sound backwards but wasn't my point).  Just that tax preparers who concentrate on taxes, no matter what license they might have or not have, probably are worth more at tax time than anyone else, with or without a credential, who doesn't spend as much time on taxes as Rita does.  I have clients that tell me a CPA told them they could do something on their return, but when I ask questions find out the CPA works in a corporation preparing reports for the CFO and prepares no personal returns at all, not even his own (he typically pays the CFO to do it; the CFO often has a biz degree, by the way, not accounting).  So, you can't rely on the letters to know what someone is good at.  CPA can, but does not have to, equal personal taxes.  EA should, but doesn't always, equal personal and small biz taxes.  And, either of those without real world experience is probably not yet the equal to Rita or anyone who works hard for their clients, keeping up with tax law.

I have an MBA in finance.  My advisor wanted me to take the one more accounting course that would give me an MBA in accounting instead.  The majority of my courses were accounting (only one less accounting class than accounting majors), but I liked taking the finance courses and statistics and a mix of business classes and writing a thesis, so that's what I did.  And, I did spend years in a corporate environment (COO, controller, etc.) before taking tax courses.  During those years, I prepared my own return and the trust we set up for my son's college with the divorce and my father's estate in IL and then married a school teacher and had to learn all about unreimbursed employee expenses.  I knew it was time to learn a lot more about taxes.  I never would've tried to prepare taxes for pay during those years, because at least I knew that I didn't know what I didn't know.  None of the accounting courses prepared me to deal with the practicality of filing personal tax returns for real people with all their quirks, and none of my work in companies along side CPAs had anything to do with personal income taxes.

[NECPA in NEBRASKA]

We found out that we have a possum living under the shed a couple of years ago when we heard this loud banging on the deck in the middle of the night. We went to look and it was trying to eat the loaf of bread that I had tried to make in my new bread machine. It was banging it on the deck, because it was like a brick. I will never live this down. My husband and son called the bread "muck".That didn't scare the possum away. He still hangs around on the deck at night. 

[RitaB]

11 hours ago, NECPA in NEBRASKA said:

We found out that we have a possum living under the shed a couple of years ago when we heard this loud banging on the deck in the middle of the night. We went to look and it was trying to eat the loaf of bread that I had tried to make in my new bread machine. It was banging it on the deck, because it was like a brick. I will never live this down. My husband and son called the bread "muck".That didn't scare the possum away. He still hangs around on the deck at night. 

Crying.  "It was like a brick...I will never live this down."  Absolutely crying.

[RitaB]

12 hours ago, Lion EA said:

My response was in answer to Rita who said even the CPAs don't charge as much as HRB (which does sound backwards but wasn't my point).  

My guess as to why this occurs here is that HRB is just charging the same rate whether in CA, NY, AL or TN.  Incomes and living expenses are not the same everywhere, but they don't care.  They can rip off a lot of people here because a lot of people are desperate for refundable credits and don't even bother trying to get a reasonable tax prep fee.  Let's face it, it's free money, and they don't care what it costs just lemme have it now. People who earn money are more likely to try to keep it.  If we compared how many EIC returns there are here compared to where some of you live, it would tell the tale. 

My guy I'm talking about in this thread is not one of those refundable credit recipients.  He moved here in 2014 and probably came from an area where a chain store was the reasonable fee.  Well, now he knows.  It's not that way here.  I wind up with several every year who try it once and then ask around, "Who does your tax return?" 

Rita.  Rita does my return.  You know, that girl that traps possums under her office and takes them to the movie theatre.

[Lion EA]

But you know you're good and your clients know you're good and now people just asking around know you're good at tax preparation, so they will pay more than they would pay the not as good preparer, whether HRB or anyone not as good as you, with or without letters after their name or with or without possum movie dates.  You're not in competition with anyone else any longer.  You've already won.  You can raise your prices, which would allow you to fire some PITAs and still make as much.  Do less work for the same money for college tuition.  Or take new, nice clients and do the same work for more money to buy popcorn at the movies.

[Gail in Virginia]

I think being able to take a possum to the movies should be worth a higher fee.  IMHO

[jklcpa]

Well darn. Who knew possums make good dates, and I turned mine away for lack of referral.  At least I see they are cheap dates with all that's needed is a brick 'o bread. 

Dying of laughter here.

[BHoffman]

I do believe having "CPA" after your name makes people expect to pay more. so it's easier to charge more.  I think EAs get the short end of the stick sometimes because no one know what an Enrolled Agent is, or what it takes to get that designation.  I have a lot of forum friends who are noncredentialed or EAs.  I'm a CPA.  I help them with business tax returns and quickbooks accounting stuff.  They help me with weird 1040 things.  It all works out.  EAs don't get much benefit of training in accounting, and accounting is what business returns are all about.  CPAs don't get any training in how to prepare 1040 forms in school.  If you're a CPA and you want to prepare tax returns, you almost always have to work like a dog and get paid peanuts for a few years in a CPA firm as an employee in order to get the experience.

[Don in Upstate NY]

The difference between CPAs and EAs is evident on some of the other forums.  EAs cite publications and CPAs cite code and regulations. Could be because back in the old days the IRS sent out a box of publications as the EA "study kit".  And they both ask Tax 101 questions.

And of course, initials ARE important.

Don, EA, MBA, NCI

[Catherine]

The initials are more important because your clients and acquaintance-level colleagues respect them.  They are meaningless without the actual knowledge and skills to back them up.  I got the EA over a decade ago to represent clients coming to me with prior-year problems.  My degree is in earth & materials sciences but I put myself through college doing bookkeeping and accounting.  Worked for an agency and got to work in so many different fields and that has been really useful.  I've seen know-nothing bookkeepers make a muck of things.  I've seen know-too-much bookkeepers make a muck of things (including on purpose, by theft).  I've seen know-it-all CPA's make a very impressive muck of things.  I've seen CEO's make a muck of things (the one I'm thinking of, by embezzlement) and the CPA in charge of financial statements to the board most definitely did NOT want to follow up on my very leading questions.   I've found errors in audited financial statements prepared by a high-end chartered accountancy firm, brought in by a client with interests in a foreign company.  I resolved issues in a month that led a guy with a Master's in Accounting a merry chase for three years.

I always figure, there are no differential equations involved, so how hard can accounting be?  The answer:  not terribly IF you are willing to look with an open mind, dig into and DO the messy grunt work, and not muck with things-as-they-stand until you understand what already works and what does not.  The big issue with EA's and corporations is that it's really hard to do anything but tiny corporations as a one-person shop, and still serve other clients.  That's where a CPA firm comes in handy - they tend to be larger.  They also tend to work with companies big enough to have a competent in-house accounting staff.  

The alphabet salad means nothing if you can't back it up.  Lack of alphabet salad means (or should mean) nothing if you can produce the results.  

And the alphabet salad I like best is on my Constitution teaching cards; "Catherine G White, CLFBM."  Came from the first big presentation I did, years ago.  Lady who had hired me to talk to her group (and was very surprised at my lack of height; had expected me to be much taller) told me the next day that I was a "cute little fire-breathing munchkin" and I just loved that.