Discussion:Hello - any words of wisdom for career changer?

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Discussion Forum Index --> User Introductions --> Hello - any words of wisdom for career changer?

Ggi999 (talk|edits) said:

18 August 2013
Hi, I am strongly considering changing careers from Financial Accounting to Tax and am hoping for third-party feedback/thoughts/stuff-to-be-aware of. I am a CPA but with zero tax experience. I consider my GAAP and financial accounting knowledge to be solid.

I am kind of old, maybe, to be changing careers (born 1971). I don't want to make this too long but I want to give enough info to anyone kind enough to think about responding...I have a wife and two young children and currently earn in the 90's. San Antonio Texas. My wife has been staying home with kids for past five years but is ready to return to workforce to help fill the hole from what would presumably be a significant drop in my income, at least in the short/medium term.

My motivations for career change:

--- I am bored and have been for years. I LOVE tax policy.

--- I think (could be wrong) that I could do tax, at least part time or seasonal, later into life than financial accounting. In Financial Accounting, if you are above a certain age and lose your job, you are going to have a hard time getting another. Thoughts here definitely welcome.

-- Can work with individuals and small businesses. Apart from my current job, I have been in nameless, faceless, big-co anonymous environments.

-- Possibility of going solo after gaining technical competence

Specific questions:

a) How long does it take to get good? By good I mean that you feel confident that you can handle the tax issues of prospective clients. I am blown away by the range of issues people post about on the forum. Blown away. Tax seems way more intricate than Financial Accounting, with a ridiculous number of fact-set scenarios. In Financial Accounting, you are at least guided by underlying principles.

b) What are my best options for gaining technical competence? I am interested in local or regional firms. CPE like crazy? MS in Taxation program part-time? OJT?

c) Would many firms even consider a 42 year old with no tax experience

d) Where in the pecking order of local/regional firms would someone make ~$90K? Tax Manager? How long to get there 3-7 years, depending on how good you are?

e) You can make a difference in people's lives

Wow, longer than I thought. Thanks for reading.


Kevinh5 (talk|edits) said:

18 August 2013
My advice: Take the H&R Block class and get a job working for someone for two or three tax seasons. Honestly. You've got to start with the easy tax returns.

If you do start your own practice after 2 or 3 years of working for someone, have enough cash set aside to live on for another 2 or 3 years. You will need to plow everything back into your practice.

While I am a HUGE believer in CPE, it won't make any sense to you until you actually start doing some returns. Neither will an MST.

I would hire someone who had taken the Block course and worked preparing returns for 3 seasons ANY DAY over a CPA with an MST but no real practical tax prep experience.

Kevinh5 (talk|edits) said:

18 August 2013
Do note that I would say the exact same thing for a new EA without any tax prep experience. I don't need a person to discuss theory with (that's what TA is for, and it's free). I need a person who knows how to prepare some tax returns.

Kevinh5 (talk|edits) said:

18 August 2013
As for what pay to expect from being a Tax Manager, there is a person on this site who may be able to give you good advice: Jeff-Ohio. That is his position with his firm.

Kevinh5 (talk|edits) said:

19 August 2013
If you don't make it to Tax Manager quickly, consider the rule of thumb that in our profession: you should generate billings (and collections of) 3 times what you earn. So if you want to earn $90,000, I'd expect you to put out $270,000 of work.

You won't get there with the easy returns, but you do need to learn the basics before you can advance to the difficult returns.

PHIL MOODY (talk|edits) said:

21 August 2013
Kevin, you put out some cold hard facts. Most people do not want to hear or believe it takes a while to earn a dollar. One thing you did not mention was the hours it takes. There is a big difference between billable hours and total hours, so yes, it does take a while.

Kevinh5 (talk|edits) said:

21 August 2013
Well, the reality is that he's not going to get to $270,000 billable by doing $300 tax returns 4 months of the year, but he needs to understand the $300 returns before anyone will trust him with the $1,500 returns.

Ggi999 (talk|edits) said:

8 September 2013
Thanks for the thoughts. So, you need to bill ~$270K to earn $90K...Billing at $135/hr after a handful of years doesn't seem all that high, but doing it for 2,000 hours definitely does. Or, alternatively, one thousand $270 returns. Or 270 $1,000 returns. Man, looking at it like that, how does anyone make $90K?

But here are average salaries (excluding bonuses) at "small" public accounting firms per the 2013 Robert Half Salary Guide:

--- 0-1 years experience: $43-$54K

--- 1-3 years experience: $49-$63K

--- Senior: $59-$77K

--- Manager: $78-$99K

Somehow, firm economics must work to support the above wages, assuming of course that the figures are accurate (anyone care to chime here?). Clearly (well maybe nearly clearly), you'd have to work on relatively complicated returns. So, my question then is: how do you get from zero to Tax Manager. Or zero to the point where you'd have sufficient technical skills to buy/start your own practice. One step at a time, right.

Tax Writer (talk|edits) said:

8 September 2013
H&R block sent me a recruitment email today, with a link to take an exam to assess my tax knowledge. Email me and I'll forward it to you if you like. It's essentially a headhunting email. I get them all the time now that the IRS is forced to share tax pro information (which I HATE!) but there it is. You can try working for a chain part time this coming season and see if you like it, get some experience and then go off on your own. I worked for a temp service right out of college as a CTEC in CA and became an EA about 4 years after that. Never looked back.

Kevinh5 (talk|edits) said:

9 September 2013
As I wrote, ask Jeff-Ohio about Tax Manager status.

Beckynewt (talk|edits) said:

10 September 2013
I don't post often, but this topic applies to me. I switched careers in my late 30's (from inventory control management). I took the H&R Block tax course (a very good class) and worked for them for one season. Then I decided to go back and get my subsequent degree in accounting and CPA license (I had a finance degree). None of the Big 4 firms were interested in me, but I then worked for a local small CPA firm in town, making a very decent salary.

The H&R Block class and work provided great training on individual returns, but none on business return experience (all the "fun" returns were handled by the old timers - it is impossible for a newbie to earn much there). But by working at a small CPA firm, I got to do business returns right away, and had the advantage of working closely with a mentor (my boss, the owner). I think many small firms would welcome someone with a strong accounting background; I find many tax preparers don't like financial accounting that much. Networking is key - I worked hard to grow the CPA firm's clientele (as opposed to building my own brand) because I felt like I was getting paid to learn.

Since then, I switched gears to Business Valuations and Ownership Transitions - Still do some tax work but have a nice balance.

Good Luck - I say go for it!

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