How Much Does a CPA Cost for a Small Business?

Three common pricing models

CPAs usually bill by the hour, by project or by monthly package.

• Hourly: you pay for time spent. Good for questions and one-off advice, but costs can be hard to predict.
• Flat fee: a set price for a defined job such as a tax return or entity setup.
• Monthly retainer: a recurring fee that may include bookkeeping oversight, payroll reporting, tax planning and a set number of calls.

Ask what each price includes and what triggers extra charges. Rates differ widely between small-town practices and big-city firms, so collect two or three quotes.

What drives the price

Complexity, the state of your books, entity type and the number of transactions have the largest effect.

Factors that raise the bill include multiple owners or entities, multi-state taxes, payroll, inventory, many transactions, messy or late bookkeeping and rushed deadlines. A sole proprietor with tidy books costs much less to serve than a multi-location company with years of cleanup.

The cleaner your records, the lower your bill. Hours spent sorting receipts are hours you pay for.

Typical services and who needs them

Tax preparation, tax planning, bookkeeping review, financial statements and advisory work are the main services.

1. Tax return preparation: required annually.
2. Tax planning: strategy during the year, often saving more than it costs.
3. Bookkeeping or cleanup: often done by a bookkeeper at a lower rate.
4. Financial statements: useful for loans, investors and sale of the business.
5. Advisory: entity choice, pricing, growth and cash flow.

See our guides on necessary small business accounting reports and business structures for related questions.

CPA, bookkeeper or software?

Use software for routine tracking, a bookkeeper for daily entries and a CPA for tax, strategy and review.

Many small businesses use a layered approach: accounting software for transactions, a bookkeeper for monthly upkeep and a CPA for tax filing and annual planning. This often costs less than having a CPA do everything. If you are very small and simple, software and a CPA at tax time may be enough.

How to judge whether it is worth it

Compare the fee to the tax savings, errors avoided and time you get back.

Illustrative example: if a CPA charges $3,000 a year and helps you avoid a $2,000 penalty, find $4,000 in deductions you would have missed and free ten hours a month to sell, the value is clear. If your finances are simple, a lower-cost option may suffice. Ask about credentials, experience with your industry and how they communicate.

Questions to ask before hiring a CPA

Clarify scope, timing and communication up front to avoid surprise bills.

• What exactly is included in the quoted price?
• How are phone calls and emails billed?
• What is the turnaround time for returns and questions?
• Who does the work: the CPA or staff?
• Do you have clients in my industry?

Get the agreement in writing, and ask for a sample of the reports you will receive. A clear engagement letter prevents disputes later.

CPAs and getting funded

Clean financial statements and tax returns make funding applications smoother.

A CPA can prepare statements that funders and SBA lenders trust. Many fast funding products need only bank statements. ROI Funder considers 500+ FICO, 6+ months in business and $20,000+ monthly revenue, and a complete file is the application plus 3 months of business bank statements. If you also want to plan a bigger project, ask your CPA to review the payback math before you borrow. See how to calculate small business loan ROI and our working capital page.