Is It Worth It to Hire an Accountant for a Small Business?
Is It Worth It to Hire an Accountant for a Small Business?
If you're a small business owner, you’ve probably asked yourself, “Should I hire an accountant, or can I manage the books myself?” It’s a valid question—especially when every dollar matters in the early stages of growth.
While accounting software has become more accessible, there's a big difference between entering transactions and strategic financial planning. Whether you're just starting out or scaling, hiring an accountant can bring financial clarity, save time, and help you avoid costly mistakes.
In this guide, we'll explore whether hiring an accountant is worth it for your small business, what they actually do, and when to bring one on board.
What Does an Accountant Actually Do for a Small Business?
An accountant does far more than just file your taxes. A skilled accountant can:
Set up your books and help choose the right accounting method (cash vs. accrual)
Track revenue and expenses
Ensure compliance with local, state, and federal tax laws
Prepare and file taxes accurately and on time
Run payroll
Manage cash flow and budgeting
Identify deductions and tax-saving strategies
Offer financial advice for growth and investment decisions
Help you choose the right business entity (LLC, S Corp, etc.)
Represent you before the IRS if needed
With these services, an accountant becomes more than a service provider—they become a strategic partner in your business.
Can I Just Use Accounting Software Like QuickBooks Instead?
You absolutely can—and many business owners do start with QuickBooks, Xero, or Wave. These tools are great for:
Invoicing
Expense tracking
Mileage logging
Basic financial reports
However, software doesn’t replace expertise. QuickBooks can show you what’s happening, but it can’t tell you why it’s happening or what to do about it. It also won’t:
Review tax law updates
Recommend entity restructuring
Catch financial red flags
Ensure compliance with multi-state tax issues
Strategically plan for growth
If you’re relying solely on software, it’s easy to overlook tax-saving opportunities or make reporting mistakes.
Need guidance interpreting your QuickBooks data? Legacy Tax & Resolution Services can help turn numbers into meaningful strategy.
How Much Does It Cost to Hire an Accountant for a Small Business?
The cost of hiring an accountant varies based on your needs and the complexity of your finances.
Typical Costs:
Monthly bookkeeping: $200–$1,000+
Tax preparation: $400–$1,500+
Payroll services: $100–$400/month
Quarterly or annual consulting: $150–$350/hour
Full-service accounting firm: Custom packages based on your business size
Many small business owners start with quarterly consulting and tax prep, then scale up to monthly services as their business grows.
While hiring an accountant is an upfront investment, it often pays for itself through time saved, tax savings, and reduced risk of IRS penalties.
What Are the Signs I Need to Hire an Accountant?
Not sure if you’re at the tipping point? Here are some clear signs it’s time to bring in an expert:
You’re spending hours each week on bookkeeping or taxes
You’ve received IRS notices or made tax mistakes
You’re unsure about deductions or write-offs
Cash flow is inconsistent and hard to predict
You're hiring employees or contractors
You're planning to expand into a new market or state
You’re unsure how to pay yourself legally
If you checked even one of these, an accountant can bring clarity, peace of mind, and measurable savings.
Can an Accountant Help Me Save on Taxes?
Yes—this is one of the top reasons business owners hire accountants. A good accountant doesn’t just fill out forms—they create a tax strategy that helps you:
Maximize deductions
Avoid penalties or audits
Time expenses and income for optimal tax impact
Choose the right tax classification (sole proprietor, LLC, S Corp, etc.)
Identify tax credits and incentives
They’ll also help you plan ahead to avoid surprises—like a big tax bill you weren’t expecting.
Want to explore how much you could save with tax planning? Schedule a consultation with Legacy Tax & Resolution Services to get expert, personalized guidance.
When Is the Right Time to Hire an Accountant?
The best time to hire an accountant is before you run into financial confusion or tax issues. Ideally, bring one on when:
You’re forming your business
You’re earning consistent income
You’re hiring help
You’re applying for business credit or loans
You’ve outgrown spreadsheets or DIY tools
Even a one-time meeting with an accountant early on can prevent major headaches down the road.
What’s the Difference Between a Bookkeeper and an Accountant?
Many people confuse bookkeepers and accountants, but they serve different functions:
BookkeeperAccountantRecords daily transactionsAnalyzes financial dataReconciles bank accountsProvides tax planning and filingManages payroll data entryAdvises on business structure and growthPrepares reportsInterprets reports and suggests improvements
Some firms offer both services under one roof—saving you time and ensuring accurate records flow directly into tax returns and strategic planning.
Is It Risky to Handle Business Finances on My Own?
Doing your own accounting isn’t inherently risky—but the margin for error increases as your business grows. Mistakes can lead to:
IRS audits or fines
Overpaying taxes
Missed deductions
Payroll compliance issues
Inaccurate cash flow forecasting
Unless you have formal training, you may not even realize something is off until it’s too late.
Hiring an accountant helps you identify financial blind spots and fix them before they become costly problems.
How Can an Accountant Help Me Grow My Business?
Accountants don’t just look backward—they help you plan forward. Here's how they contribute to growth:
Cash flow management to ensure you can scale safely
Profitability analysis to cut unnecessary costs
Business structure changes for tax savings
Loan and funding strategy
Budgeting for new hires, products, or expansion
They also help you set realistic financial goals and measure progress. It’s like having a CFO—without the six-figure salary.
What Happens If I Get Audited and Don’t Have an Accountant?
If you're audited and don’t have an accountant:
You’ll be solely responsible for providing documentation
You may struggle to understand IRS terminology
You’ll be less likely to successfully dispute findings
The process can become overwhelming and time-consuming
But if you’ve worked with a qualified accountant, your records will be clean, organized, and easy to defend.
Accountants can even represent you before the IRS—reducing your stress and increasing your chances of a favorable outcome.
What Should I Look for in a Small Business Accountant?
Here’s what to look for when hiring an accountant:
Experience with small businesses
Familiarity with your industry
Licensed CPA or Enrolled Agent (EA)
Clear communication and responsiveness
Transparent pricing
Comfort with your software or tech tools
Proactive about tax planning, not just compliance
Choose someone who sees your business as more than a file—look for a long-term partner who’s invested in your success.
Final Thoughts: Is It Worth It to Hire an Accountant for a Small Business?
Yes—for most small businesses, hiring an accountant is not just worth it—it’s essential. You’ll gain:
More time to focus on your business
Confidence in your financial reports
A smarter tax strategy
Fewer surprises from the IRS
Better business decisions backed by data
An accountant is one of the few investments that directly impacts your bottom line and peace of mind.
If you're ready to stop guessing and start growing with financial clarity, contact Legacy Tax & Resolution Services today. Their experienced team understands the challenges small business owners face—and they’re here to help you succeed.
References
IRS – Small Business and Self-Employed Tax Center
SBA – 10 Steps to Start Your Business
AICPA – What Is a CPA?
