Most house flippers need a team of professionals to help ensure success. A team might consist of a real estate agent, contractor, insurance agent, lender, and a Certified Public Accountant, or CPA. A CPA can help you create a defined accounting strategy specific to your business needs. Having an accountant is good for your day-to-day business activity;  a CPA can perform duties an accountant can not and has a fiduciary responsibility to put their clients’ interests first.

But not all CPAs are alike. For your flip-and-fix business, consider an investor-friendly CPA, someone who may have real estate investments themselves, or many clients who do. A good investor-friendly CPA can provide tax strategies that can save you money down the road.  Stessa, an app for landlords, outlines some of the benefits below:

Real estate CPAs can perform specific duties that an accountant legally can’t, such as preparing audited financial statements for investors in a limited liability company (LLC) or representing real estate investors in meetings with the IRS.

• A CPA can do things that an accountant can’t, such as preparing audited financial statements for group investments or representing an investor during an Internal Revenue Service (IRS) audit.
• The benefits of hiring a real estate CPA include minimizing potential tax liability, getting guidance for structuring a real estate business and optimizing current and future investments.
• A good real estate CPA can help an investor remain tax-compliant during a 1031 exchange and provide advice on more sophisticated investment strategies, such as real estate investment trusts (REITs).

Where do you find a good investor-friendly CPA? You can begin with an online search, get recommendations from other investors in your real estate networking group, or through Bigger Pockets, a website community for investors. The Bigger Pocket forum is ripe with discussions on vetting CPAs and you can connect with a tax strategist through their site. You will want a professional who stays educated and up-to-date on the ever-changing tax laws.

Once you have narrowed the field, use CPVerify.org to check the licensing for your state then set up an interview. Most CPAs will offer a free initial consultation to help determine if the fit is right. Fast Trac Consulting, an online accounting service offers a list of questions to ask:

• How did they get started in doing what they do best?
• When did they delve into real estate?
• If not all of it, what percentage of your practice today is in real estate?
• What is their previous experience?
• What education has the tax preparer received?
• Why did they want to be a CPA or EA? (This question helps you understand if they are truly invested in your business; you do not want someone who does not care. Also, make sure to ask if their CPA license is still active!)
• When are they available? (Make sure you are working with somebody who is available when you need him or her. Ask them if they can work year-round or if they are only free during tax season.)
• Will they be able to represent you at an IRS audit?
• Can they provide an example of how they helped save a real estate client before?
• What other services do they offer?
• Any recommendations for accounting software?
• Would you help in creating new entities? (Structure such as LLC, S-Corp, C-Corp)
• Are you familiar with other state filings? (You should ask this because, given that today there are no bounds of traveling or virtual investments, it might be pertinent in the future even if it is not right now.)
• Do you own any investment properties yourself? If so, what kind are they (e.g., rental properties, vacation homes, farmland, properties you’ve sold on land contract, etc.)?  (This is definitely a more personal question, and anybody who owns a house is going to say yes–but it still gives you the chance to see if they partake in real estate investing themselves outside of their own home!)

If you are planning to grow your business, a good CPA can help you stay tax-compliant and create a winning strategy for your financial future!