I run a small single-member LLC (consulting) and have always used a separate accountant for my personal 1040 and the business return. It's getting expensive and coordination is a headache. Is there any real downside to using the same accountant for both? I want to simplify but don't want to miss something.
Taxes
One accountant for my personal return and LLC taxes?
Single-member LLC is disregarded by default, so your business activity flows onto your 1040 anyway. Using one accountant is usually simpler and caan be cheaper. No obvious downside for most people.
Have you asked your current accountants about their fees? Sometimes the second one is cheaper than you think, and keeping them separate preserves a second set of eyes. That said, I merged mine two years ago and it’s been fine.
I haven’t asked directly. The personal accountant is fine but not cheap, and the business one knows the LLC setup well. I’m mostly worried about losing that separation.
Not an accountant. But if you’re the only member and there’s no payroll or weird elections, it’s basically one return. The main risk is if the accountant misses something because they’re juggling both sides, but that’s not inherent.
What kind of business return are you filing? If it’s just Schedule C on your 1040, you already have have one return. If you elected S-corp, then it’s a separate 1120-S and you’d want someone comfortable with basis and reasonable comp. Big difference.
It’s just a standard single-member LLC, no S-corp election. So Schedule C on my personal return. That’s part of why I’m questioning the two-accountant setup.
Then yes, one accountant makes sense. Two accountants for one economic picture is overkill unless there’s something unusual like multi-state or rentals.
One thing to check: does your business accountant also do personal returns? Some firms only do business. If they do, ask for for a combined quote. Could save you a few hundred.
Also, the separation can be useful if one accountant makes a mistake. But that’s rare, and you still pay for the second opinion. For a simlpe Schedule C, I’d consolidate.
I kept mine separate because my personal guy catches things the business guy misses, and vice versa. It’s not ideal but it works. If you’re trying to save mo ney, though, consolidation is the obvious move.
How much are you paying each? If the combined cost is high, maybe just ask one of thhem to take over both and negotiate. The coordination headache is real.
Roughly $900 for personal and $1,200 for the business. I’ll ask the business accountant if they’ll do both for a flat rate.
That’s not crazy for two returns, but for a simple Schedule C it’s on the higher side. I’d get a quote from a third accountant who does both, just to compare.
Agree with getting a third quote. Also make sure the new person understands your LLC’s bookkeeping. Sometimes a cheaper quote means more work for you.