I am NOT a numbers person.
In fact, I nearly failed algebra 2 in high school.
Why I thought I could prepare my own taxes for my private practice is beyond me.
I Decided to Hire an Accountant
I tried to be SO organized:
I really thought that I could handle the financial ins and outs of my speech therapy private practice but after a one tax season, I decided to hire an accountant.
It’s funny, when I first met with David, I thought I was organized. I had lists and added columns and separated and totalled receipts and I honest thought he was going to be so impressed with me.
The problem was, the way that I had organized my financial information didn’t make it easy for him to input everything into the IRS forms online.
What should have been an hour long appointment became a two hour appointment, which meant I owed double what I thought it was going to cost me.
And I was totally embarrassed and ashamed.
Benefit #1: To Get Organized (and Create a “Tax Binder”)
While I tried to use it, I found the form a bit confusing. I knew what information he wanted but I wasn’t sure how to organized it.
When I actually met David, everything clicked.
His warm personality was welcome as I had feared that he would be a rigid and impatient accountant.
He could tell how much effort I had put into organizing everything and helped me see where I needed to reorganize myself.
He taught me a system based on creating a Tax Binder that I immediately fell in love with and still use to this day. (Instructions on how to create your own Tax Binder can be found in Chapter 7 of The Guide to Private Patients)
Being a nerdy SLP, once I got home from the appointment, I immediately took the main content from his forms, customized them to meet my needs and created home-punched sheets to put in a brand new binder.
Knowledge is power… and so is confidence.
Benefit #2: For Piece of Mind
When it came to entering in my private practice information, I was completely lost. I did the best I could and hit send. I got a refund (yes!) but wasn’t sure if I had really done everything correctly.
I immediately vowed to make enough money in the future so that I could hire someone else to file my taxes. And I did 🙂
Not only was I able to sleep at night knowing that everything had been done properly, I went into the new year completely organized and on top of everything. I tracked my income and expenses in a much more organized way (using Freshbooks) and knew exactly what to pay in quarterly estimated taxes.
The year before I was afraid to spend the money on an accountant. That year, I couldn’t spend it quick enough!
Benefit #3: They Pay For Themselves
After meeting David, I realized that I could write off:
- My professional license
- Any CEUs or educational experiences
- Part of my cell phone and home Internet bill
- My home office
- and much more
I believe the first year I met with David, I paid him $250 and he got me back close to $1500. I’ll take that any day!
The benefit of meeting with someone isn’t as much about keeping track of your earnings (although they will help you with estimated taxes if you have earned enough) but also with making sure you get all tax deductions you’re entitled to. Taking deductions reduces that amount of your income, which reduces the amount you owe / get refunded.
Before my life and finances got more complicated, I paid about $250/year. Now that I am married and have a business, home, child and other expenses, I pay closer to $1,000 (but accountant fees are also tax deductible.)
If you have other friends in private practice, consider asking them who they use. It’s helpful (but not essential) that an accountant be highly familiar with the professional lives of SLPs, OTs and PTs. They aren’t doing billing for you – they are looking at income and expenses.
Another place to check is review sites like Yelp and Angie’s List. Again, try to look for people with experience with therapy practices but if not, experience with small business / freelancers will do.
Hint: You want to make sure that whomever you hire is a Certified Public Accountant or CPA. CPA’s are certified and licensed, having passed rigorous tests and with requirements for continuing education.
Considering Hiring an Accountant For Your Private Therapy Practice…?
Jena’s “Taxes Binder”
The Guide to Private Patients is available here.
Jena H. Casbon, MS CCC-SLP is a speech-language pathologist and private practice consultant. She started her own speech therapy private practice in 2006. She is the founder of The Independent Clinician and author of The Guide to Private Patients and The Guide to Creating a Web Presence for Your Private Practice. Since 2008, she has helped thousands of clinicians get the flexibility, income and freedom they desire from starting their own private speech therapy, occupational therapy and physical therapy practices.