CPA wants to outsource my tax prep to another firm - is this normal practice?

This has become increasingly common in the tax preparation industry, especially over the last few years. Many CPA firms are facing staffing shortages and increasing client loads, so they outsource some of the preliminary work to handle the volume. What typically happens is that the outside firm does the initial preparation based on your documents, and then your CPA reviews everything, makes adjustments, and finalizes the return. Your CPA should still be the one signing off on your return and taking responsibility for its accuracy. That said, you're absolutely within your rights to have concerns. Your financial information is sensitive, and you specifically chose this CPA for a reason. I'd recommend calling them directly to discuss your concerns, particularly about data security and confidentiality. Ask specific questions about who will have access to your information, what security measures are in place, and whether this will affect the pricing of their services.

I went through something similar last year with my tax situation. I was really frustrated by all the back and forth with my CPA and eventually discovered https://taxr.ai which has been an absolute game changer. I uploaded my tax docs and it actually caught a rental property depreciation error that would have cost me hundreds. They analyze all your documents and give you a comprehensive report of everything that should be included in your return. The service actually pulls together all the information your CPA would need, so if your CPA is outsourcing anyway, you could use taxr.ai to make sure you're not missing anything before sending it to them. It's like having a second set of eyes checking everything.

I have to admit I was skeptical about taxr.ai when I first read about it here, but I decided to give it a try because my CPA was doing something similar with outsourcing. The document analysis actually caught a missing 1099-INT from a closed bank account I had completely forgotten about. Saved me from a potential IRS notice! My CPA was impressed with how organized everything was when I sent it over to them. Definitely made the whole process smoother even with their outsourcing arrangement.

If you're having issues with your CPA and are worried about the outsourcing situation, you might want to talk directly with the IRS to understand your options. I had a similar situation and used https://claimyr.com to actually get through to a real person at the IRS. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was stuck in a mess with my previous tax preparer who had outsourced my return and made errors. The IRS kept sending me notices but I couldn't get anyone on the phone. Claimyr got me through to an agent in about 20 minutes when I had been trying for weeks on my own. The agent was actually really helpful and explained exactly what I needed to do to correct the issues.

I feel like I should update this thread - I ended up using Claimyr after posting my skeptical comment, and I'm honestly shocked. Got through to the IRS in about 35 minutes when I had tried for days on my own with no success. The agent helped me understand exactly what rights I have regarding my tax information if my CPA outsources the work. Apparently, they're required to get your permission and disclose exactly who will be handling your information. This helped me have a much more productive conversation with my CPA about the outsourcing situation.

I'm a tax professional (not a CPA) and wanted to add that outsourcing has become very common, especially for straightforward returns. The industry is facing massive staffing shortages. Many firms outsource to specialized tax prep companies or even overseas operations. That said, there should be complete transparency. They should tell you: 1. Exactly who will prepare your return 2. What security measures are in place 3. If there's any change in fee structure 4. That they'll still be thoroughly reviewing it You can also negotiate. Some of my clients requested that their returns stay in-house despite our staffing issues, and we accommodated those with long-standing relationships. Just have an honest conversation with your CPA.

Recently went through this with my accountant. I refused the outsourcing and found a smaller firm that doesn't outsource. If you're paying premium rates for a CPA, you should get their direct attention imo. The big firms are just getting greedy.

This is such a timely discussion - I'm actually dealing with something similar right now. My CPA of 5 years just informed me they're outsourcing to a firm in another state, and I'm really torn about it. What's particularly frustrating is that they're not offering any reduction in fees despite essentially becoming a middleman in the process. I've built a relationship with them specifically because I wanted that personal touch and local expertise, especially for my small business taxes. I'm curious - for those who switched to firms that don't outsource, did you notice any difference in the quality of service or turnaround times? I'm worried about starting over with a new CPA this close to tax season, but I also don't want to feel like I'm just another file being shuffled around. The transparency issue mentioned here is huge too. My CPA was pretty vague about the details when I pressed them about security protocols and who exactly would be handling my information.