Hiring a Bookkeeper or an Accountant They're not just there to keep the books--they're there to help you run your business smarter.

Most people in business for themselves, especially those starting out, believe they can keep their own books. After all, they find plenty of good accounting software on the market, programs that practically fill the spreadsheets out by themselves. They believe they can save money and at the same time keep a closer eye on expenses when they write every check themselves and balance every account.

Those arguments have a lot of appeal. But I've found that in the long run, a bookkeeper or accountant is not just someone who keeps track of the pennies and receipts, but a key member of your management team. I ask my accountant whether I should lease or buy a car, extend a business trip into a vacation, and how much I should put aside for retirement. In short, specialists are worth their salt because they know how to save you time and money.

One example: If you're thinking of buying a truck or van for your business, did you know that if the vehicle weighs 6,000 pounds or more, it qualifies for the so-called Section 179 expensing election? That means you can deduct $24,000 of the cost. A passenger car--that is, one that weighs less than 6,000 pounds--is eligible for a deduction of only about $3,000. Thus a business owner with the choice of buying a Chevy Suburban, at 5,700 pounds, and a Ford Super Duty Van, at 9,000, may choose the latter for the tax break. (The cost of gasoline is another matter!)

That's a tip from tax guru Kerry Kerstett, a CPA in Harrison, Arkansas. It was one of several tips that made the finals in a contest for bookkeepers and accountants just held by Intuit Software, maker of the popular QuickBooks accounting programs.

Here's another: When the tax season approaches, or especially if your company is preparing for an audit, it doesn't pay to have a CPA perform the routine tasks of balancing accounts and putting your books in order. Althea Klahr, a small-business consultant at the Marvin and Co. accounting firm in Latham, New York, estimates a savings of 35 percent when you use a bookkeeper instead of a CPA. She said that some small businesses, as well as nonprofit entities such as churches and community organizations, will learn they need an audit to qualify for government funding, then unwisely rush out to hire a CPA when the first step is just to get an outside bookkeeper. "Accountants can recommend paraprofessionals if their firm doesn't have any on their staff," says Klahr, using the industry's term for bookkeeper.

My own advice at tax time is to consider using an enrolled agent. That's an income-tax specialist licensed to prepare returns and filings. Enrolled agents have been around since the 1800s and really know their stuff because they have to pass an intense examination given by the IRS. Most enrolled agents are former IRS employees, many of them examiners. An enrolled agent charges $50 to $150 an hour depending on where you live, according to Frederick W. Daily, author of Tax Savvy for Small Business.

Mindy Schwartz, owner of the Balanced Book Co. in Carlsbad, California, has special advice for start-ups: "When trying to decide whether there is a need for new or different employees, the business owner should always assign a dollar value to the services he personally provides, even if he isn't currently taking a salary," Schwartz says. "It is too easy for a small-business owner to just manage everything without taking into account the value of his own time, and comparing that to the cost of an employee performing the same task."

Using a spreadsheet, Schwartz likes to show a business owner exactly how much the owner's time is worth, then compare that figure to the cost of hiring a new employee or service provider. "In a very small business, with one or two employees, the cost of adding another employee does not add very much to overhead," she says. "Usually, you already have the space; it's just a matter of adding a desk or a computer. Or more often the new employee will work from home."

The added salary, Schwartz says, can be justified in two ways: The owner has more time to devote to the core of the business (which leads to more income) or more time to enjoy life. "I can show somebody how much it will cost to buy back a couple of hours a day just to get out and take a long walk," Schwartz said in a telephone interview, after having taken, that very day, a long walk by a lagoon in her seaside town.

Schwartz says she usually succeeds in persuading an owner to hire another salesperson or a bookkeeper. "Most people do start out doing the books themselves," she says, "or having their wife or husband do it at home. Most of them kind of learn as they go." Many of Schwartz's clients own restaurants; she says an owner can keep a competent set of books working four or five hours a week.

A huge plus in keeping your own books is privacy. In effect, bookkeepers and accountants are the confidants of the business world. You probably share more confidential information with them than with your clergyman. Think about it. The trail left by your money reveals your life story. If you are having an affair and use a credit card to pay for a hotel room, your accountant will know about it. If you order roses online, the charge will appear on your credit card and may raise a question about whether or not they were a business expense.

That said, you have to balance privacy against the value of expertise. I recommend finding a bookkeeper or accountant who specializes in your industry. You can start by contacting your industry association, or ask a lawyer who knows your business. Last tip: Don't try to hire a bookkeeper or accountant between January 1 and April 15.

Jane Applegate is a syndicated columnist and the author of201 Great Ideas for Your Small Business. For a free copy of her "Business Owner's Check Up," send your name and address to Check Up, P.O. Box 768, Pelham NY 10803 or e-mail it to info@sbtv.com. Joe Applegate contributed to this article.