Sub contract for CPA firm?

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#1
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Suppose I am an EA with a small tax and bookkeeping business.

A CPA wants me to do some tax and bookkeeping work for him/her as a subcontractor. Does this qualify as “required experience” under the supervision of a CPA in order to get my license as a CPA in the state of California?
Assuming I passed all 4 parts.
 

#2
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The hours won't count unless a CPA signs off on them, and most firms are loathe to do that for employees, much less independent contractors. It was a common tactic for firms to "withhold" signing off on hours in order to retain auditors in their existing positions, knowing that many of them would jump ship as soon as they got their license. I saw this at several firms.

That being said, your CPA might be willing to do it, as long as you discuss the issue beforehand. Each state society has different rules, and they change frequently, so I would check with the AICPA to get your answer.
 

#3
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tax prep might not even count. its been years but when I went through it, you needed financial statement preparation, auditing etc. Tax alone didn't cut it.
 

#4
Coddington  
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New York is something of an outlier in that it won't accept tax hours.
-Brian

Director of Tax Accounting Methods & Credits
SourceAdvisors.com

Opinions my own.
 

#5
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Tax_Writer wrote:The hours won't count unless a CPA signs off on them, and most firms are loathe to do that for employees, much less independent contractors. It was a common tactic for firms to "withhold" signing off on hours in order to retain auditors in their existing positions, knowing that many of them would jump ship as soon as they got their license. I saw this at several firms.

That being said, your CPA might be willing to do it, as long as you discuss the issue beforehand. Each state society has different rules, and they change frequently, so I would check with the AICPA to get your answer.


How is that remotely legal?
 

#6
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How is that remotely legal?

It's legal the same way firing someone for no reason is legal. This ain't fantasyland. If the employee makes a fuss, then the employer's first argument is that the hours weren't "qualifying"-- ie, the employee's work product wasn't "up to snuff". Employees that rock the boat get replaced by new hires fresh out of accounting school. I've seen lots of people walk out on these jobs, only to see them replaced within a week.

In 2005, the last time I worked for a big firm, the new auditors only got 38K to start. The required travel and hours were insane. They took their computers to the audit location and worked all day, then went back to their hotel rooms and worked all night. They were basically slaves.

Once the auditors got their CPA license, they often quit, unless they got a pay raise.

Oh, and it depends on the requirements for the state-- tax hours do count towards the license in CA, but if you get your CPA license with only tax hours, it's restricted somehow-- you can't do audit work. Not sure exactly how it works, and it's been years since I've checked.
 


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