Start a virtual bookkeeping practice

  1. Draw the line between bookkeeping and tax advice
    45 min

    This step produces the one-page scope boundary that becomes the practice's liability line: the services you sell, the services you refer out, and your referral rule. It is tricky because the line runs through everyday client questions — “is this deductible?” is a tax question wearing a bookkeeping costume, and answering it is where unlicensed bookkeepers get hurt.

    1. Write the “you sell” column: bank and credit card reconciliation, transaction categorization, monthly profit-and-loss and balance sheet, and data preparation for the client's tax preparer.
    2. Write the “you refer out” column: tax return preparation, tax planning, payroll tax filings, attestation such as audits and reviews, and anything that requires a CPA license or enrolled-agent authority.
    3. Add the gray-zone rule: entering and categorizing a transaction is bookkeeping; telling a client how to treat it on the return is tax advice — that goes to their CPA or enrolled agent.
    4. Add the referral line: when a client asks what to do with the numbers, say “that is a question for your CPA — I will send them the prepared data,” and actually do it promptly.
    5. Save the page as a dated one-page PDF in your client folder.