When people think about paying for third-party CPA services, they often focus on how accountants work with businesses. That is a legitimate job within accounting services. However, individuals also can benefit from hiring a CPA. If you're wondering whether your individual finances call for the support of an accountant, here's how to tell.
Some individuals have finances that are as complicated as you'll see at major companies. If you own real estate, stocks, bonds, art, or other assets, simply tracking them can be a challenge. This only gets more complex if you're using trusts or other legal vehicles to insulate your assets from potential liability. For example, a doctor with a lucrative medical practice needs to have a hard partition between their personal and business finances because of the risk of malpractice lawsuits.
No one should pay more taxes than necessary. Controlling your tax exposure can be work, though. For example, people who have large capital gains bills pending may need to enact loss-harvesting strategies to reduce their tax liabilities. You also need to be aware of the limits of common strategies, such as using tax-deferred retirement accounts to keep your taxes lower.
If you have extensive enough finances to require CPA services, then you almost certainly need an accountant to advise you about estate planning. While most practices don't explicitly handle estate planning, all accounting services that work with individuals can provide basic support. Even if you just need help identifying assets and accounts so you can have a lawyer draft some documents, an accountant will be invaluable.
Risk of Public Scrutiny
At a certain level of wealth, public scrutiny can develop. You don't need to be a legitimately famous person, either. People use public records to target individuals for scams, for example. How you handle your accounting will affect just how much outside interest will come your way because of your finances.
Ideally, you can set up your finances to minimize your personal visibility. Some individuals use companies and trusts to obscure the connections between them and their finances. This will allow you to pay your bills and taxes without additional headaches.
Finally, individuals may find that their money and assets aren't generating sufficient returns. Accountants won't offer investment advice, but they can point you toward interest-bearing accounts that may help. Especially if you want to see a return on idled money like what you're holding to pay taxes, this is a good way to realize some gains or at least offset some losses.
For more information, contact a local company like Colasanti & Iurato.