Short answer: No.
But, since you’re asking, you’re probably looking for more justification. Why was “no” such a quick answer for us when this was a big question on your mind?
I suspect it’s due to the root of your question – which is whether or not you can hire an online bookkeeper from another country at a lower rate. That comes down to two things:
- The difference between a bookkeeper and an accountant
- Federal and state tax regulations and implications
Let’s tackle each…
Difference Between a Bookkeeper and an Accountant
A bookkeeper is responsible for keeping up your books. They record payments, categorize expenses, reconcile accounts, send invoices, and maybe even process payroll and AP (accounts payable).
An accountant is responsible for keeping your finances accurate and guiding you to follow appropriate (and legal) accounting practices.
While your bookkeeper doesn’t have to be in the US, if your business is in the US your accountant really should be too. And, they should be a CPA (Certified Public Accountant). In order to become a CPA in the United States, a financial professional must have a bachelor’s degree in Accounting, at least 150 college credit hours, and pass a state licensure exam.
In case you’re now wondering, “Which one do I need?,” the answer is: both.
You need someone to keep up the books throughout the year, and a certified professional to complete and file your taxes each year.
For small businesses, that often means that the business owner or an assistant handles the bookkeeping as part of their regular duties, and a third-party accounting firm handles the annual taxes.
For larger businesses or those with more complicated expenses and receipts, an on-staff Accountant (or several) may be necessary. In this case, Bookkeepers can act as assistants, ensuring that the more expensive, certified professionals spend their time on the tasks they are most qualified to do. Bookkeepers can be in the office with the accountant or they can work remotely.
This brings us back to whether or not your bookkeeper needs to be in the US. They don’t. You can hire a remote bookkeeper that can categorize expenses, reconcile accounts and do all of the never-ending task work to keep your books up-to-date regardless of which country they happen to be in.
Federal and State Tax Regulations and Implications
As I said above, we highly recommend having a certified accountant for your US business. While you (the business owner) are ultimately responsible for the accuracy of your financial records and your tax compliance, a CPA can help guide you through the processes and the changing tax code and regulations.
So, your bookkeeper doesn’t need to be in the US, but your accountant really should be.