Check out the Robert Half guide to accounting salaries, a quick google search should produce the link.
Partners in firms will typically earn on average 400k+ and I would assume the max would be well in excess of 1mil a year.
The amount of money you make will all depend on how hard you work, and your book of business. The same will be true regardless of whether you are in a large firm, or you run your own company.
The high end players at the large firms make so much because they are able to reap the benefits of the people working under them. Typical breakdown for a large firm is 30% overhead, 30% wages and 30% profit. if you are a partner or have equity, then you receive your salary for billable hours, plus a percentage of the profits earned by both yourself and your staff.
Owning your own firm will greatly depend on the amount of work you do, your billable hours and your hourly rate.
Without a CPA you will be limited to bookkeeping, payroll, sales tax, and income tax preparation. With an EA you can expand your practice to include taxpayer representation for audits with the IRS or state taxing agencies.
EA rates average around $150 an hour billable for tax preparation and representation. Bookkeeping rates will be lower, probably between 40 and 100 at the max.
Tax prep is usually done as either value billing or minimums, or per the form. You would set your own rates but a small CPA firm might charge 350 and up for a return. A larger mid tier firm might be 450 and up for a return. So it might take you an hour or 2, but you can charge a premium on your time to bill in excess of your normal hourly rate.
Summary – CPA hourly rates are typically 300 an hour and up. If you work for yourself and keep staff and expenses low, you can work 1000 billable hours generating 300k a year, and lose about 100k to rent, part time staff, office expenses, insurance, etc. Have a profit of 200k and lose another 40-45% to taxes between fed and state. Fund your own 401k or SEP, pay your own health insurance, etc. still have a very decent livable wage. Figure out what your non CPA hourly rate would be vs your CPA rate of 300+, then factor 1000-1500 billable hours a year, times the number of years you expect to continue working… is it worth it?
if your grow your book of business to the point that you can expand and hire more people, you end up in a position to make money off of their work.
Your earning potential CPA or non-CPA is simply dictated by your work ethic. The CPA just makes your time worth double, meaning you work half as much, or work the same amount for only half the time and retire asap.
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