Career

Starting a CPA firm: A complete guide to success

April 24, 2025

8 min read

Opening a CPA firm - a shot of a new office with a computer, shelves, and window

Marketing Manager, Content

If you've been considering going out on your own and starting a CPA firm, you're in good company. For many accounting professionals, this allows you to take control of your career and finding both professional and financial fulfillment. To help you with opening your own firm, we're walking you through why it's a great idea, what you need to get started and how to make it a thriving business.

Benefits of Starting a CPA Firm

Before we get into the nuts and bolts, first, let's look at why starting a CPA firm may be the best option for your career. Below are some of the key advantages:

Control and independence: You have full autonomy over how your business operates, from the clients you serve to the hours you work.
Profit potential: Unlike working for an employer, your income is directly tied to how much revenue your firm brings in, giving you the opportunity to have more control over your income and increase it as your firm grows.
Flexibility: Opening a CPA firm lets you create a work environment and culture that aligns with your values and lifestyle preferences.
Professional growth: Running your own firm builds your skillset beyond accounting as you learn business strategy, marketing, and management.
Legacy building: You have the opportunity to leave a lasting impact, both professionally and within your community, by building a recognized and respected firm.

Take the next step: 6 Benefits to owning your own accounting firm

To make sure you see these benefits, you'll need to take a strategic approach to opening and running your firm. Let's start with narrowing down your niche and defining your services.

Before opening your CPA firm: Choosing your niche and services

One of the most important early decisions you'll make when opening a CPA firm is determining your niche and the specific services you’ll offer. For example, do you want to offer accounting and tax services to small businesses? Maybe you'd rather work with high-net-worth clients? Choosing a niche allows you to specialize, refine your skills, and market more effectively to a targeted audience, but most importantly, you're more likely to find fulfillment in your work.

Identifying your ideal client

Ask yourself: What industries or sectors do I enjoy working with the most? Consider which fields align with your interests or values. For example, do you prefer working with small businesses, the healthcare sector, real estate professionals, or even tech startups? Think about which industries excite you and where you can see yourself making the most impact.

Do I have specialized knowledge or experience in a particular area?

Reflect on your skills and expertise before starting your CPA firm. Have you developed a strong background in tax preparation or financial planning? Specialized knowledge can help you stand out and position yourself as an expert in a specific area.

What type of clientele do I want to attract?

Consider the kind of clients you’d enjoy working with. Would you prefer working with high-net-worth individuals to reduce tax payments and plan for the future, helping startups grow and succeed, supporting nonprofits with their financial needs, or even focusing on freelancers and entrepreneurs? Think about the people you picture sitting across from your office desk (or popping up on a Zoom call) in your ideal business scenario. That's your ideal client!

What value can I bring to these clients or industries?

Identify the unique skills, strategies, or tools you can offer to meet the needs of your preferred clientele. For instance, do you excel at streamlining financial processes, offering innovative solutions, or delivering personalized advice that adds real value to their goals?

What kind of environment or dynamics suit me best when starting a CPA firm?

Do you thrive in long-term partnerships where you guide clients over time, or do you prefer short-term, project-based work? Identifying how you like to work with clients can help you attract the right opportunities.

By defining what you want to do and who you want to work with, you can tailor your services and market your firm to that specific audience.

Determining services in a CPA firm

Your niche should guide the specific services you provide. Some common offerings at CPA firms include:

Tax preparation and planning
Bookkeeping and payroll services
Financial statement preparation
Audit and assurance services
Advisory services and accounting consulting (e.g., financial strategy, business valuation)
Specialized services like forensic accounting or international tax compliance

Once your service list is determined, you’ll be ready to outline the requirements needed for opening a CPA firm.

Requirements for Starting Your CPA Firm

Starting a CPA firm involves both legal and logistical preparations. Here’s a breakdown of the essentials:

1. Obtain your CPA License

To operate your firm, you need an active CPA license. Ensure your license is in good standing with your state's Board of Accountancy and maintain it with continuing professional education. Note: You can open an accounting firm without a CPA license of course, but it will limit the services you can provide your clients.

2. Choose a business structure

Select the appropriate business entity for legal and tax purposes. You probably know all about these, but it can be a bit harder to make the right choice when starting your own CPA firm:

Sole Proprietorship: The simplest entity to establish, often used by small or single-owner businesses. However, it offers no liability protection, leaving personal assets exposed to business risks. Ideal for clients starting small but worth discussing alternatives as they grow.
LLC (Limited Liability Company): A flexible structure offering liability protection and pass-through taxation. Many business owners prefer LLCs for their balance of simplicity, protection, and tax options. Advising on the right state-specific regulations is key here.
Corporation (C-Corp or S-Corp): Provides strong liability protection and is often the best choice if you're seeking to scale, attract investors, or go public. While C-Corps face double taxation, S-Corps can offer pass-through taxation benefits, with stricter requirements. Ensuring compliance with corporate formalities is essential for this entity type.
Partnership: A straightforward option if you're opening a CPA firm multiple owners. General partnerships lack liability protection, while Limited Partnerships (LPs) or Limited Liability Partnerships (LLPs) can limit risk. Clear agreements on roles, ownership, and profit-sharing are critical for success.

3. Register your business

Comply with your state’s regulatory requirements by registering your firm with the local Secretary of State or governing authority. Depending on your location, you may need to apply for a Firm Permit or submit additional documentation.

Take the next step: CPA firm requirements

4. Obtain necessary licenses and insurance

Employer Identification Number (EIN): Required by the IRS for tax purposes
Business licenses: Check local and state licensing requirements to ensure compliance
Professional liability insurance: Protect your firm from potential malpractice claims.

5. Open a business bank account

Keep personal and professional finances separate by establishing a dedicated business bank account before starting a CPA firm. This step will make bookkeeping and tax preparation significantly easier.

6. Secure accounting technology

From tax preparation software to practice management platforms, having appropriate tools will allow you to streamline operations and deliver high-quality service.

Take the next step: Accounting software for accountants and CPA firms

With the foundational requirements in place, it’s time to focus on launching your firm.

Steps to starting a CPA firm

Okay, you know that starting a CPA firm is the right decision, you know what you want your business to be, and how to get started. But now, it's time to actually work on opening your CPA firm. This might feel overwhelming but breaking it into manageable steps can help ensure a smooth process.

Write a Business Plan

A solid business plan is your road map for success. Include:

Your vision and objectives Services you’ll offer Target market and niche Marketing strategies Financial projections and startup costs Operational plans (e.g., staffing, technology needs)

Take the next step: A how-to-guide to writing your CPA firm business plan

Estimate Startup Costs

The costs to opening a CPA firm vary greatly, ranging between $2,500–$25,000 depending on requirements such as:

Office space, if you're not working from a home office
Licenses and registration fees, including LLC costs and business insurance
Technology and software purchases
Website and marketing expenses

Develop a Marketing Strategy

Your next challenge is attracting clients. Consider implementing a multi-channel advertising strategy:

Website: Build a professional, SEO-optimized site listing your services and expertise
Social Media: Use platforms like LinkedIn to engage potential clients and share financial tips.
Networking: Attend industry events or partner with local businesses for referrals.
Content marketing: Produce eBooks, blogs, and webinars to establish your firm as an authoritative resource and generate leads from your ideal clients

Take the next step: Marketing your CPA firm

Set Competitive Pricing

Research pricing models in your area to establish fair, yet profitable fees. Common models include:

Hourly Rates: Suitable for detailed projects requiring unpredictably timed services.
Flat Fees: Offers clients transparency and predictability, fostering trust.

Build Relationships and Gain Referrals

Quality client service is critical for steady referrals. Stay engaged with existing clients, solicit testimonials, and reward referrals through incentives.

Refine Operations

From managing schedules to securing client data, efficient operations will set the stage for growth. Invest in:

Encrypted cloud storage for secure file management
Online appointment scheduling tools
Automated billing systems for seamless payment processing

Common obstacles when starting a CPA firm (And how to overcome them)

Even with careful planning, you're going to run into challenges. Here are some you might encounter and strategies for tackling them:

Finding Clients

Building a strong client base starts with networking and establishing meaningful relationships within your niche. Attend industry events, join online communities, and participate in discussions to increase your visibility. Leverage targeted digital marketing strategies—such as social media ads, SEO, and email campaigns—to connect with potential clients who align with your services. Create a compelling portfolio or case studies to showcase your expertise and attract interest.

Managing Time

Time management is crucial for productivity and growth. Automate repetitive tasks like invoicing, scheduling, or email follow-ups using tools like CRM software or task management platforms. Delegate administrative duties or non-core tasks to a virtual assistant or team member so you can focus on higher-value activities. Prioritize your day with a clear schedule and stick to deadlines to stay organized and efficient.

Cash Flow Issues

Maintaining healthy cash flow is essential for sustainability. After starting a CPA firm, make sure to track cash flow closely by using budgeting tools or accounting software to monitor income and expenses regularly. To create stability, introduce retention packages or subscription-based services that provide ongoing revenue. Additionally, consider offering discounts for upfront payments or implementing payment plans to encourage timely transactions

Build strong skills before starting a CPA firm

Becker has over 700 on-demand CPE courses, plus 1,000 live webcasts and weekly CPE podcasts. You can build skills in taxation, accounting, and audit, plus learn more about marketing, management, and communication to ensure you know what you need when opening a CPA firm. Check out these options: