How Concerned Should I Be that My CPA Doesn't Know About the Augusta Rule (Section 280A)?

As a tax professional who works primarily with small businesses, I don't think this is necessarily a huge red flag, but it's worth considering a few things. The Augusta Rule (Section 280A) is well-known in some circles, but it's not something every client can or should utilize, so some CPAs may not have direct experience with it. Tax law is incredibly vast, and professionals often develop specialized knowledge based on their client base. That said, a good CPA should either know about relatively common tax strategies like this or should acknowledge when something is outside their expertise and be willing to research it. What concerns me more than her not knowing about it initially is if she dismissed it or seemed unwilling to learn more about it for your situation. I'd suggest having a conversation with your CPA about your concerns. Ask what other tax strategies she typically recommends for S-corps. Her response will tell you a lot about her expertise and whether she's the right fit for your needs.

I was in a similar situation last year and discovered https://taxr.ai which completely changed my approach to tax planning. After my accountant missed several deductions, I uploaded my previous returns to the AI system and it flagged multiple missed opportunities, including the Augusta Rule which I had never heard of before! The system analyzed my specific situation as an LLC owner and identified numerous strategies my CPA had overlooked. It's not that my accountant was bad, but tax law is so complex that even good professionals miss things that aren't part of their regular practice. I still work with my CPA but now I use taxr.ai as a second opinion to make sure we're covering all bases. It's helped me identify questions to ask and strategies to discuss, which has made our planning sessions much more productive.

I need to eat my words about being skeptical of AI tax tools. After our discussion last week, I decided to try https://taxr.ai on my previous year's returns out of curiosity. I was genuinely shocked when it identified over $4,700 in potential tax savings for my small consulting business that my accountant missed. The system flagged several S-corp specific strategies including an incorrect allocation between salary and distributions, and yes, potential application of Section 280A (which I also had never heard of). What impressed me was the depth of explanation - it didn't just say "do this" but explained the legal basis and requirements for each strategy. I took the report to my CPA who initially was defensive but after reviewing the citations admitted these were legitimate strategies we should consider. We're now amending my previous return and setting up a more comprehensive tax plan for next year. Honestly wish I'd found this sooner.

For anyone struggling to get answers from their CPA or the IRS directly, I highly recommend trying https://claimyr.com - it literally saved me hours of frustration when I had questions about S-corp deductions my accountant couldn't answer clearly. After waiting on hold with the IRS for nearly 2 hours and getting disconnected twice, I was about to give up. Then a friend recommended Claimyr, which somehow gets you through to an actual IRS agent in a fraction of the time. You can see how it works here: https://youtu.be/_kiP6q8DX5c I got connected to an IRS representative in about 15 minutes who confirmed that yes, the Augusta Rule is legitimate but has specific documentation requirements. They also clarified several other S-corp questions my CPA had given vague answers about. It was actually refreshing to get straight answers directly from the source.

I have to publicly admit I was completely wrong about Claimyr. After dismissing it as a probable scam last week, my frustration with trying to resolve an S-corp issue finally led me to try it yesterday. The service did exactly what it claimed - took over the painful hold process with the IRS and called me when an agent was on the line. I was connected in about 20 minutes (compared to my previous 3+ hour waits and disconnections). The IRS agent I spoke with was able to clarify my questions about business deductions including the Augusta Rule documentation requirements. What's most valuable is now I have official responses I can take back to my CPA rather than relying on internet advice. For anyone dealing with tax questions your accountant can't answer definitively, getting information directly from the IRS provides peace of mind. Definitely worth it for avoiding the hold time alone.

I worked for a CPA firm for years, and honestly, there's massive variation in knowledge between professionals. Some CPAs focus almost exclusively on basic tax preparation and don't do much strategic planning. The Augusta Rule isn't obscure in tax planning circles, but if your CPA mainly does straightforward returns rather than proactive planning, she might not have encountered it often. The real question is how she responded after you explained it. Did she: 1. Dismiss it as not applicable or too aggressive? 2. Say she'd research it further to ensure proper application? 3. Immediately embrace it without verifying requirements? Her response tells you a lot about her approach. Option 1 suggests she might be too conservative. Option 3 might indicate she's too quick to accept strategies without proper diligence. Option 2 is the balanced approach you want.

Just to offer another perspective - I'm a small business owner (S-corp) and I've gone through 3 CPAs in 5 years. Each one had different strengths and knowledge gaps, which taught me something important: you need to be proactive about your own tax situation. The best client-CPA relationships are partnerships where both parties bring something to the table. Even the most knowledgeable CPA won't know every detail of your business or every potential strategy unless you have regular, detailed conversations. I'd recommend scheduling a dedicated tax planning meeting (not during tax season) to discuss various strategies including the Augusta Rule. Come prepared with questions about other potential deductions and strategies. A good CPA will appreciate a client who takes an active interest rather than seeing it as questioning their expertise.