Podcasts

The Hidden Traps in Clean Energy Credits That Could Cost Your Clients Thousands

Earmark Team · August 27, 2025 ·

Picture this scenario: You just finished a call with a client who mentioned installing solar panels on her vacation home. Now it’s tax time, and she’s dropped off her tax documents, including information about the solar installation. Among the paperwork, you find two invoices: one for the solar panels, equipment, and installation labor, and another from a building contractor for roof work. Your client included a note explaining that the solar panel installation required structural retrofitting to make the roof suitable for the panels.

This is your first time dealing with solar tax credits. You know there’s some special tax benefit, but you’re not sure how it works. Which expenses qualify? How do you calculate the credit? And what about those two different invoices? Does the roof work count toward the solar tax credit?

This scenario comes from Jeremy Wells’ Tax in Action podcast, where he walks tax professionals through the residential clean energy credit. Wells, a CPA and Enrolled Agent in Florida, has seen this situation repeatedly as more clients install solar panels and other clean energy property.

While the residential clean energy credit offers substantial savings—at least until it’s eliminated at the end of 2025— tax professionals must navigate complex qualification rules, timing requirements, and cost allocation issues, often with limited regulatory guidance beyond the basic code section.

Understanding the Clean Energy Credit Basics

The residential clean energy credit comes from Internal Revenue Code Section 25D. It provides a nonrefundable credit for up to 30% of qualifying expenses on residential clean energy property. The credit was initially designed to be worth 30% of qualifying expenses through 2032, then drop to 26% in 2033 and 22% in 2034. However, H.R. 1, commonly known as the “One Big Beautiful Bill Act,” eliminated the credit at the end of 2025.

Since this is a nonrefundable credit, it can’t reduce a taxpayer’s liability below zero or create a refund. However, if the credit exceeds the taxpayer’s current tax liability, the excess carries forward to future years.

The qualifying property includes several types of clean energy installations:

Solar panels (most common)
Solar water heaters
Small wind energy systems
Geothermal heat pumps
Fuel cell property
Battery storage property

It’s important not to confuse this with the residential energy efficiency improvements credit under IRC Section 25C, which covers items like new windows, insulation, or HVAC systems. Those fall under a completely separate credit.

What Makes a Residence Qualify

Unlike some residential tax benefits that only apply to primary residences, Section 25D has broader requirements. The property must be installed at a “dwelling unit,” a place the taxpayer actually lives in the United States and uses as a residence. This can include second homes, vacation homes, or summer homes, as long as the taxpayer uses them personally.

However, the credit doesn’t apply to rental properties or investment properties. If a client installs solar panels on a rental property, that falls under entirely different tax provisions.

Business use of the home creates additional considerations. If more than 20% of the property’s square footage is used for business purposes (like a large home office), you’ll need to allocate the expenses. The taxpayer can only claim the credit on the portion allocated to personal use of the home. For business use of 20% or less, no allocation is required.

Qualifying Costs and Technical Requirements

Determining which costs qualify for the credit requires careful analysis of invoices and documentation. Eligible expenditures include:

The cost of the property itself
On-site labor costs to prepare, assemble, and install the property
Costs to connect the property to the home’s electrical or plumbing systems
Sales tax paid on eligible costs

However, not all installation-related costs qualify. Wells explains the critical distinction: “If the panels actually become a structural part of the roof, then we can include that cost. That’s different from saying that we had to do some work to the roof to be able to install those panels.”

In the opening scenario, the solar panel installation costs would likely qualify, but the separate roof retrofitting work probably wouldn’t. The roof work represents preparation rather than panels becoming part of the roof structure.

Different types of property have specific technical requirements:

Solar water heaters must be certified by the Solar Rating Certification Corporation or a comparable state-endorsed entity.
Geothermal heat pumps must meet Energy Star requirements.
Battery storage needs a capacity of at least three kilowatt hours. As Wells notes, “I’m not an electrical expert. I’m a tax professional. I’m going to ask the client for some piece of paper from the installer showing me that it has a capacity of at least three kilowatt hours.”
Fuel cells face cost limitations of $1,667 per half-kilowatt of capacity.

Any property that serves additional functions beyond energy production, like a swimming pool or hot tub heated by solar energy, can’t include those additional components in the credit calculation.

Rebates, Incentives, and Excess Generation

Rebates and incentives can affect the credit calculation. Direct or indirect rebates from manufacturers, distributors, sellers, or installers reduce the eligible costs. However, state government incentives typically don’t reduce the federal credit calculation.

A particularly complex issue arises when solar installations generate more electricity than the home needs. If the taxpayer sells excess electricity back to the grid, only the portion of costs related to the home’s actual electricity needs qualifies for the credit.

Wells acknowledges the challenge this creates: “Do we allocate this based on actual electricity generated and over what period of time? Should we be using data from the home’s electrical usage prior to installation? These are all unanswered questions as far as the guidance we have now.”

Timing Rules That Matter

When a taxpayer can claim the credit depends on the type of installation:

For existing residences, the credit applies when the property is completely installed, when work crews are done, and when the property is ready for use. For new construction or reconstruction, the credit applies when the taxpayer begins using the dwelling unit, which may be later than when the clean energy property is installed.

This distinction can shift credits between tax years and impact tax planning. Wells sees many situations where taxpayers start work in one year but don’t complete installation until the next year, or where installation happens late in the year but certification doesn’t arrive until the following year.

If taxpayers finance the purchase through the seller, they can calculate the credit based on the full cost of their payment obligation, not just the amounts actually paid. However, interest on financing doesn’t count toward eligible costs.

Documentation and Reporting Requirements

Tax professionals often find themselves helping clients gather documentation that the client should have obtained during the purchase process. This includes:

Detailed invoices breaking down eligible and non-eligible costs
Certification documents showing technical specifications
Information about any rebates or incentives received
Details about excess electricity generation and sale back to the grid

Taxpayers report the credit on Form 5695, Residential Energy Credits, with different lines for different types of property. The form calculates the maximum credit amount and applies limitations based on the taxpayer’s tax liability.

Since this is a nonrefundable credit, it can offset the alternative minimum tax but can’t create a refund. Any unused credit carries forward to future years.

Practical Takeaways for Tax Professionals

Wells emphasizes that, unlike most areas of tax law, practitioners have limited guidance beyond the code section itself. “We really don’t have much guidance beyond what’s in the code section itself. We don’t have any Treasury regulations related to this code section, which is not very common.”

This means tax professionals must rely heavily on professional judgment when making determinations about qualification, cost allocation, and timing. The key is asking the right questions:

Is this the taxpayer’s personal residence, and what percentage do they use for business?
What costs did the homeowner pay, and are there any rebates or incentives?
For a solar electric property, is the property owner selling any electricity back to the grid?
When was the property completely installed, or when did the taxpayer move into a new residence?

Wells notes that sometimes by helping clients gather proper documentation, “we actually help them ensure they’ve gathered all the documentation they might need in the future.”

The residential clean energy credit offers significant tax savings for qualifying installations, but success depends on careful analysis of costs, proper documentation, and understanding the technical requirements that vary by property type. While the guidance may be limited, a systematic approach to qualification and documentation helps ensure clients can take advantage of these valuable credits while maintaining compliance with tax requirements.

To hear Wells’ complete analysis and additional examples of how to handle complex scenarios, listen to the full Tax in Action episode.

Protect Your Bookkeeping Practice: Essential Boundaries That Preserve Your Value

Earmark Team · August 27, 2025 ·

When hosts Alicia Katz Pollock and Veronica Wasek spun their “Wheel of Rants” on a recent episode of The Unofficial QuickBooks Accountants Podcast, they landed on a topic that sparked an energetic discussion: “The 20 things that accountants should never do.”

What followed was a candid conversation about the essential boundaries every bookkeeper should establish to protect themselves and their clients. Whether you’re just starting your bookkeeping practice or you’re a seasoned professional, these boundaries are critical safeguards for building a sustainable business.

Client Relationship Boundaries: Who’s Really in Charge?

“Allowing clients to control the work we do and really treating us as employees” topped Wasek’s list of boundary violations. She explained that many bookkeepers, especially those transitioning from employee roles, fall into the trap of letting clients direct their work.

“The client shouldn’t be directing the work you do,” Wasek emphasized. “There should be proper diagnosis done by us as accountants and then we give the client our recommendations.”

This distinction is crucial: Are you following orders or leading the process? As Katz Pollock pointed out, “If you’re a bookkeeper with your own firm or your own practice, you should be the one guiding the narrative.” Otherwise, you might actually be functioning as an employee rather than an independent contractor.

Financial Boundaries: Know Your Worth

Both hosts shared strong opinions about working for free or undervaluing services. Wasek explained how offering free work “devalues our industry as a whole” and signals that you don’t value your own expertise.

Katz Pollock added a practical concern: “If you were willing to do it for free, why would I pay you $500 a month to do it?” This initial boundary violation creates expectations that become nearly impossible to reset later.

Another common mistake is marking down invoices without discussion. Wasek shared an example based on her own experience. “My fee was $10,000 based on all the time that I spent on it, but I don’t think they’re going to pay me $10,000, so I just charge them $5,000.”

She now recognizes this as a serious boundary violation, explaining, “We tend to project our own feelings about money to our clients.” Instead of assuming clients won’t pay, have an open conversation about pricing.

Katz Pollock offered a practical strategy for those who bill hourly. “I charge what I consider a reasonably high rate, and that allows me to give a discount. Then I feel like everybody wins. I’m still getting a satisfactory rate, and they feel good.”

The hosts also warned against becoming financially dependent on just a few clients. “What if one out of those three leaves and you were financially dependent on that client?” Wasek cautioned. This dependency traps bookkeepers in problematic relationships where they can’t enforce other boundaries for fear of losing essential income.

Security Boundaries: Protecting Your Clients and Yourself

“Having direct access to the client’s bank accounts or their bill payment” is a practice Wasek strongly discourages. She shared a sobering example of a client that embezzled $8 million through their in-house bookkeeper, who had unrestricted access.

Katz Pollock acknowledged the practical challenges, noting she sometimes needs bank account access to view statements or check images. Her solution involves strict controls: “We have a 1Password vault that nobody has access to except for me and my contracted bookkeeper,” plus explicit language in her engagement letter that they “will never take any action either on your behalf or at your request.”

Both hosts emphasized the importance of secure password management. “Nowadays, you need to have unique passwords for everything,” Wasek explained, recommending systems that limit credential visibility to only those who absolutely need them.

Email communication presents another security concern. “The bane of my existence is emails,” Katz Pollock admitted, noting important client communications often get buried. More critically, Wasek warned, “There are so many email scams going on right now where you think you’re talking to your client and they are not your client.”

She shared a chilling example: “One of my clients was a victim of an email scam with a vendor. He sent a couple of million dollars to this fraudulent vendor, and then couldn’t do anything about it.” This led her firm to abandon email entirely for client communications, moving to secure platforms instead.

Professional Expertise Boundaries: Know Your Limits

“Taking a client when you lack the required skills” and giving legal or tax advice without proper qualifications made both hosts’ lists of major boundary violations.

“Certain industries and certain types of clients are more complex,” Wasek explained, highlighting areas like e-commerce and nonprofit accounting that require specialized knowledge.

Both hosts stressed that bookkeepers should never give tax or legal advice without proper credentials. “If you don’t have a law degree and if you don’t have a tax designation, then you can’t actually back up and stand by the advice you’re giving,” Katz Pollock cautioned.

Instead, they recommended developing relationships with specialists and having prepared responses for common client questions. As Wasek suggested, “I would try to give them the right words to use to ask their CPA the proper question.”

Documentation Boundaries: Get It in Writing

“Not using engagement letters” was another boundary violation, both hosts emphasized. Wasek learned this lesson “the hard way” after initially “working on a handshake,” explaining that formal agreements “really set the tone for the entire relationship.”

A comprehensive engagement letter should outline services provided, responsibilities, pricing, payment terms, and procedures for ending the relationship. Katz Pollock recommended reviewing engagement letters annually. “I look to see if their scope has changed. How many checking accounts did I agree to and how many do they have now?” This gives a “tangible reason for raising our prices” beyond just annual increases.

Both hosts also advocated for paid diagnostic assessments before committing to new clients. This smaller initial engagement helps evaluate a client’s responsiveness and complexity before making longer-term commitments.

Personal Boundaries: Protecting Your Time and Energy

The hosts discussed the common issue of bookkeepers acting as “unpaid therapists” for their clients. Wasek recalled a client who “would keep me on for at least an hour” multiple times weekly, making it impossible to complete actual work. She learned to establish time parameters, saying, “I’d love to talk to you, but I have a meeting in 15 minutes.”

Another crucial personal boundary involves maintaining client confidentiality. “You never, ever, ever talk badly about either the business owner or a bookkeeper to another business owner or another bookkeeper,” Katz Pollock stressed. This includes avoiding sharing information between clients or discussing former clients with their new bookkeepers without explicit permission.

Wasek shared a situation involving partnership conflicts: “I had to terminate the relationship. I would rather this client think badly of me for leaving them without a bookkeeper than to attack the other partner or to tattletale.”

Building a Stronger Practice Through Boundaries

Throughout their discussion, Wasek and Katz Pollock emphasized that proper boundaries ultimately create more sustainable and rewarding businesses.

“I am a big believer in karma, and that when one door closes, another one opens,” Katz Pollock shared. “If you have a really large client that you depend on, and either they let you go or you just find it toxic, I don’t recommend staying.”

Wasek agreed, adding that when bookkeepers release problematic clients, they gain “so much more mental energy to devote to better clients.”

For bookkeepers looking to establish stronger boundaries, the hosts recommended:

Getting proper training to understand your expertise and limitations
Using engagement letters reviewed by legal professionals
Implementing secure technology solutions for passwords and communications
Developing scripts for common boundary challenges
Building relationships with specialists for referrals
Conducting paid diagnostic assessments before committing to new clients

As Katz Pollock concluded about maintaining professional boundaries, “It says way more about you than it does about them.” It’s a reminder that how you establish and maintain boundaries ultimately defines your professional reputation and the health of your practice.

To hear more detailed insights about these essential bookkeeping boundaries, listen to the full episode using the player below or wherever you get your podcasts.

Alicia Katz Pollock’s Royalwise OWLS (On-Demand Web-based Learning Solutions) is the industry’s premier portal for top-notch QuickBooks Online training with CPE for accounting firms, bookkeepers, and small business owners. Visit Royalwise OWLS, where learning QBO is a HOOT!

From the Courtroom to the Classroom: How a Former Prosecutor Views White-Collar Crime

Earmark Team · August 23, 2025 ·

When Bernie Madoff received his 150-year prison sentence for a massive Ponzi scheme, it seemed like justice had been served. Yet after the 2008 financial crisis, which devastated millions of Americans, virtually no high-level Wall Street executives faced criminal charges. Why not?

In this episode of the “Oh My Fraud” podcast, Miriam Baer—a former prosecutor with the prestigious Southern District of New York, corporate compliance professional, and former Vice Dean at Brooklyn Law School and currently Dean and President of California Western School of Law—shares insights from her unique career journey that help explain this paradox.

From Princeton to the Prosecutor’s Office

Baer’s journey through the world of white-collar crime began far from where she expected. After attending Princeton (where, yes, she knew Ted Cruz) and Harvard Law School, she initially had no intention of becoming a prosecutor.

Her path changed after working at a law firm on securities fraud cases, which gave her a crash course in understanding how companies manipulate their books. From there, she joined the prestigious U.S. Attorney’s Office for the Southern District of New York under then-U.S. Attorney Mary Jo White.

At the prosecutor’s office, Baer handled everything from mail and wire fraud to bank fraud and money laundering, learning the intricacies of federal criminal prosecution. This experience gave her first-hand knowledge of how prosecutors decide which cases to pursue—knowledge that helps explain why some financial criminals face justice while others seem to escape it.

Why Some Cases Get Prosecuted While Others Don’t

When massive financial scandals don’t result in criminal charges, public frustration often follows. “Why aren’t these people in jail?” becomes a common refrain. But Baer identifies a more nuanced reality than simple theories about wealthy people being above the law.

“There’s a tendency to look at the scope of the harm,” Baer explains. “Someone says, ‘Well, he caused all that horrible harm. Why aren’t you prosecuting him?’ The answer is, well, I’m bound by the statute.”

Baer identifies two distinct thresholds prosecutors consider:

The “threshold of liability” – Whether a crime technically occurred under statute
The “threshold of viability” – Whether prosecutors believe they can win the case

This second threshold is crucial but often overlooked in public discussions. Based on past wins, prosecutors develop mental “prototypes” of successful cases that shape how they evaluate new evidence.

“When someone says, ‘Is this a fraud case? Is it a viable fraud case?’ [prosecutors] think in their minds about what most recently was viable,” Baer notes.

During the 2008 financial crisis, prosecutors’ mental prototype of fraud was based on early 2000s accounting scandals that featured whistleblowers, clear paper trails, and cooperating witnesses—elements largely absent in the financial crisis cases.

“My whole theory is that especially what happened with the financial crisis is, yeah, there were folks who had passed the threshold of liability, but the prosecutors weren’t sure they were over the threshold of viability,” Baer explains.

This framework helps explain why more recent cases like Elizabeth Holmes and Sam Bankman-Fried resulted in prosecution. Both featured the crucial elements prosecutors recognize from successful cases: cooperating witnesses and defendants who “constantly talk all the time” and eventually contradict themselves.

The Problems with White-Collar Criminal Statutes

Beyond prosecutorial decision-making, Baer identifies fundamental flaws in the design of white-collar criminal statutes. Her book, “Myths and Misunderstandings in White Collar Crime,” explores these issues in depth.

“The statutes themselves are confusing us,” Baer explains. She identifies three primary problems:

1. “Flat” statutes that lack gradation

Unlike homicide laws that distinguish between first-degree murder, second-degree murder, and manslaughter, fraud statutes don’t meaningfully differentiate between degrees of severity.

“If I look up fraud, it’s just all falling under the fraud umbrella of mail fraud or wire fraud. And it really doesn’t matter that you were charged with mail fraud and I was charged with wire fraud from a moral valence,” Baer notes. “It just means you use the mails and I use the wires.”

2. “Bundled” statutes that combine vastly different crimes

Baer points to the Hobbs Act as a prime example—a single statute that criminalizes both robbery affecting interstate commerce and bribery by public officials.

“That’s very different from robbery…it’s all under the same statute,” she explains.

3. Statutes that fail to generate useful information

Perhaps most importantly, these flaws create a system that doesn’t effectively track patterns or provide clear information about white-collar crime.

“The system itself should produce information because we are the ones in charge,” Baer argues. “We can’t do that job if the system doesn’t give us information or information that we could get at.”

These structural issues create an “insider/outsider” divide in criminal justice. Those working within the system understand its peculiarities, while the public is left confused and suspicious.

“It leads to this level of people feeling estranged from the system and feeling like this system is rigged,” Baer says.

Case Studies: Timing, Complexity, and Expertise Gaps

Several practical challenges further complicate white-collar crime prosecution. One is simple timing—evidence of sophisticated fraud often emerges years after the fact, sometimes through academic research long after the statute of limitations has expired.

Baer references a paper published in 2015 that uncovered significant misrepresentations in mortgage-backed securities markets from the 2008 crisis. “Little late,” she observes wryly.

Another challenge involves proving intent at the highest corporate levels, where decisions flow through layers of management.

“The public hungers for the very top person to fall,” Baer explains. “They don’t want to hear that you got Mister mid-level dude.” Yet proving that a CEO directed fraudulent activities is often nearly impossible without direct evidence.

A third challenge stems from expertise gaps. As Baer candidly acknowledges: “I think people don’t realize the degree to which lawyers in particular are generalists… after three years of law school, I absolutely did not have forensic accounting skills.”

This knowledge gap means prosecutors must learn sophisticated financial concepts while simultaneously building cases against defendants represented by specialists in these areas.

To illustrate how criminal law sometimes misses the mark, Baer points to the “Varsity Blues” college admissions scandal. While the fraudulent behavior was clear, she questions whether criminal prosecution addressed the deeper issues.

“Whatever way you should deal with this type of behavior, which of course is terrible…it wasn’t clear to me that criminal law was doing anything to really fix it,” Baer reflects.

Implications for Accounting Professionals

For accounting professionals, Baer’s insights offer a valuable perspective. Understanding the gap between technical violations and “viable” criminal cases is crucial for effective compliance work.

“Being a world-class jerk is not the same thing as violating the mail fraud statute,” Baer points out, highlighting the gap between unethical behavior and criminal conduct.

The expertise gap between legal and financial professionals creates both challenges and opportunities. Accounting professionals who can effectively translate complex transactions for non-specialists provide immense value in both preventing and addressing potential misconduct.

Baer’s solutions include creating gradations within fraud statutes, unbundling combined statutes, and designing systems that generate better information about financial misconduct patterns. These changes would not only improve enforcement but potentially rebuild public trust.

Moving Beyond Simple Narratives

The paradox of white-collar crime enforcement shapes how our financial system operates and who faces consequences when it fails. As Baer’s analysis reveals, the seemingly contradictory patterns of prosecution stem not primarily from corruption, but from structural challenges built into our legal framework.

“If you want to have a better understanding of where the problems are and how you fix them, you need better information,” Baer emphasizes.

Baer’s book “Myths and Misunderstandings in White Collar Crime” explores these themes in greater depth. For those interested in hearing more of her insights, the whole conversation on the Oh My Fraud podcast offers a fascinating look into the world of financial crime prosecution from someone who’s seen it from multiple perspectives.

Why Military Experience Creates Exceptional Accountants

Blake Oliver · August 20, 2025 ·

What do submarine oxygen levels have to do with solving the accounting talent shortage? More than you might think. For Navy veteran Mark Steinhoff, the precision required to manage life-support systems hundreds of feet underwater created the perfect foundation for his accounting career.

On a recent episode of the Earmark Podcast, Steinhoff shared how his military experience, where a single error could be catastrophic, prepared him for a profession where accuracy is essential.

The Surprising Parallels Between Military Service and Accounting

At first glance, maintaining life support systems on a nuclear submarine and balancing financial statements seem worlds apart. Yet for Mark Steinhoff, the transition felt surprisingly natural.

“The military is very structured. You’ve got that typical hierarchy, chain of command, everything’s procedural compliance. You’ve got to follow the rules,” Steinhoff explains. “And accounting is very similar. There’s a lot of rules, processes, guidelines, and regulatory compliance.”

Steinhoff served as a machinist mate auxiliary on the USS Alabama (the submarine featured in the movie Crimson Tide). His job required extraordinary precision. As he describes, “Everything you touch on the boat, if you want to take a bolt off, you have to document it. There are procedures you have to follow.” This rigorous documentation mirrors accounting’s fundamental requirement to record and verify every transaction.

The military’s verification systems also parallel accounting’s internal controls. Steinhoff points to the “two-party check” system used on submarines. “If one person wanted to go do work, they would go through independent verification, and then the other person would independently do it.” This approach is remarkably similar to the separation of duties in accounting, where different people handle different parts of a transaction to reduce errors and fraud.

The stakes in both environments are high. On a submarine, “There’s no option for mistakes.” A failed oxygen system means disaster for the entire crew. While accounting errors might not immediately threaten lives, they can certainly threaten livelihoods, affecting businesses, jobs, and investments.

Using Military Benefits to Get an Accounting Education

For veterans considering accounting careers, education is the bridge between military experience and professional opportunity. Steinhoff’s path shows how military benefits can make high-quality accounting education affordable, even at prestigious private universities.

Steinhoff left the Navy in June 2020, just as the COVID-19 pandemic began. With uncertain civilian job prospects, he decided to use his GI Bill benefits for college.

“They pay you a little stipend to pay your rent and get you through college. They pay for your books, and they pay for your tuition,” Steinhoff explains. However, many veterans don’t realize they can maximize these benefits through programs like the Yellow Ribbon Act, which allowed him to attend Texas Christian University (TCU), a private school with an annual tuition of about $50,000.

“Most of the time the GI Bill pays for public schools, but with the Yellow Ribbon, the school makes a deal with the VA to split the difference,” he explains. “The school covers 50% and the VA covers 50%.”

Steinhoff treated college as a “full-time job,” completing a double major in finance and accounting in three years. Now, he’s using additional state-level benefits to pursue an MBA at the University of Texas at Dallas.

“Texas has a program called the Hazelwood Act, which gives you another 36 months of tuition-free education at a public school,” he notes. This combination of federal and state benefits provides a clear pathway to meet the 150 credit hours required for CPA licensure.

Creating Value in Accounting Through Military Experience

While education provides the technical foundation, it’s in the workplace where veterans like Steinhoff discover their military background creates unique advantages in accounting roles.

“In a small company, maybe there aren’t processes or procedures in place,” Steinhoff notes. “Coming from that military environment, I could write a procedure, train people, and create those processes.” This skill is particularly valuable in growing companies where accounting systems may not have kept pace with business expansion.

Steinhoff’s current role at a water utility company shows how military expertise finds unexpected applications in accounting. “They liked me a lot because there are not many accountants who have worked on water systems,” he explains. “From a submarine, that was my whole life. I could tell you how a pump works, I could tell you how the valves work.” This combination of technical operational knowledge with accounting skills enables him to understand the organization’s financial and physical infrastructure.

The military’s emphasis on translating complex technical information into actionable intelligence also serves veterans well, as accounting evolves beyond compliance toward business advisory roles. “Accountants are expected to take data and translate it,” Steinhoff observes. “Veterans fit this role because business owners want someone who can take numbers and translate them into easy-to-understand language.”

For veterans considering this career path, Steinhoff acknowledges the transition requires courage. “It’s a leap of faith. When you’re getting out of the military, it’s a big challenge because it’s this whole different world.” But he emphasizes that the responsibility given to service members far exceeds what most civilians experience at similar ages.

“The military gives 18-year-olds more responsibility than any other jobs. They put me on a submarine working on things where other lives are at risk,” he notes. “If you could do that, you could do this.”

A Win-Win Solution for Veterans and the Profession

The accounting profession faces a talent shortage and needs more analytical, tech-savvy professionals who can translate financial data into strategic insights. Meanwhile, thousands of disciplined, detail-oriented veterans transition to civilian life annually, bringing with them the exact qualities the profession desperately needs.

Mark Steinhoff’s journey from maintaining submarine life support systems to managing accounting operations for a water utility shows the natural connection between military service and accounting work. The procedural rigor required to keep sailors alive underwater is the perfect foundation for the exacting standards of accounting.

For veterans thinking about their next career, accounting offers a structured environment with clear advancement paths that will feel familiar after military service. With education benefits through the GI Bill and state programs like the Texas Hazelwood Act, the required accounting education is affordable without accumulating significant debt.

For accounting firms and businesses struggling to fill positions, veterans are an untapped resource, bringing maturity, discipline, and transferable skills. Their experience with high-pressure situations, procedure development, and translating complex information aligns perfectly with accounting’s evolution toward more strategic business advisory roles.

The accounting profession isn’t just about numbers; it’s about creating systems that provide reliable information for critical decisions. Veterans spend years operating in environments where systems thinking and procedural discipline aren’t just professional requirements but matters of survival.

Listen to the full Earmark podcast episode to hear Steinhoff’s complete story and gain more insights on transitioning from military service to accounting. His journey offers a blueprint for how the accounting profession might find its next generation of leaders from those who’ve already proven their ability to perform when the stakes couldn’t be higher.

Admitting You Don’t Know Everything Became This Young CPA’s Secret Weapon

Earmark Team · August 19, 2025 ·

Picture this: You’re 26 years old with a newborn baby, eating rice and beans from a bulk bag because your accounting firm is three months away from bankruptcy. Your Excel budget calculation was catastrophically wrong, and you’re facing the reality that your entrepreneurial dream might be over before it really began.

That’s exactly where Nate Goodman found himself in 2022. He was staring at his wife across their kitchen table in Black Mountain, North Carolina, wondering if they’d bitten off more than they could chew. “I told my wife, ‘We tried it, I failed. We’re gonna have to eat rice and beans,’” Goodman recalls.

Fast-forward to today, and Goodman’s firm, Goodman CPAs, just closed 2024 with $1.7 million in annual revenue. His team of 12 professionals serves clients across the country, and he’s building toward a $2 million run rate.

His transformation from struggling bookkeeper to successful CPA firm owner didn’t happen because he suddenly became a better accountant. It happened because he discovered something many of us resist: admitting you don’t know everything can be your greatest competitive advantage.

In the latest episode of the Who’s Really the Boss? podcast, Goodman shares the raw details of his journey, including the pivotal moments when crisis became his catalyst for growth.

From Churches to CPAs: The Humble Beginning

Goodman’s story doesn’t start with grand business plans or venture capital. It starts with chickens, three young boys (ages 5, 4, and 2), and a simple desire to help churches with their bookkeeping while maintaining work-life balance.

In December 2019, fresh out of his MBA program, Goodman launched what he thought would be a small bookkeeping practice focused on churches. “I have some mentors doing this and only working 20 or 30 hours a week,” he explains.

But a conversation with Jim, an experienced CPA firm owner, changed everything. When Goodman pitched his church bookkeeping idea, Jim asked the hard question: “What are your credentials? Do you have any experience? Do you have any education?”

Goodman had an MBA but admitted to a limited accounting background. Jim’s response was direct: “Well, no one’s going to trust you if you don’t either have education or experience.”

Instead of getting defensive, Goodman chose to be teachable. Within a week, he re-enrolled in school for his accounting certificate so he could sit for the CPA exam. Jim sweetened the deal: complete a tax course, and he’d bring Goodman on as an intern for the 2020 tax season.

The Crisis That Changed Everything

By 2022, things looked promising on the surface. Goodman had purchased Jim’s practice (Jim was 85 at the time) and another practice through owner financing. But underneath, the numbers weren’t adding up.

The problem was embarrassingly simple and devastatingly expensive. Goodman had built his budget in Excel, but made a critical error. “I got the calculation wrong. My shareholder distributions were being added back to the cash,” he explains. “When I figured it out, I was like, oh, we only have like three months left, and we’re not going to make it to next tax season.”

The timing couldn’t have been worse. The CPA he’d hired was asking for more money than the firm simply couldn’t afford. “That was my first time terminating somebody. And that went very poorly,” Goodman admits.

That’s when the rice and beans period began. “We bought the big bulk bag of rice and did that whole thing to make it work,” he says. They were literally living on the most basic provisions while trying to save their struggling business.

But this rock-bottom moment became Goodman’s turning point. Instead of giving up, he finally discovered something that would transform his business: CPA communities and coaching groups.

“I did not even know that CPA communities existed, that there were other CPA owners out there that would share common knowledge. And so I was just going blind through 2022. And that was a very dark year for the business,” he reflects.

The transformation began in August 2022 when he found coaching groups that taught him proper pricing strategies and service delivery models. “I could price a 1040, but to price a CFO engagement or a bookkeeping engagement, I was just shooting from the hip and hoping for the best.”

The Systematic Turnaround

The results were immediate and dramatic. After implementing the new models and pricing strategies, Goodman’s firm grew from roughly $300,000 to $1.2 million in revenue in 2023—a nearly 300% increase in a single year.

Part of this growth came from strategic acquisitions. The acquired practices brought about $150,000 in revenue, and a third acquisition added $275,000. But the real growth came from transforming how they served existing clients.

“We were able to present to them, hey, instead of getting your financials once a year, what if we did your bookkeeping once a month, and you could make some more decisions? And what if we could save you $30,000 in taxes next year, and it’ll cost you a fraction of that, but it’s more than you’re paying now?” Goodman explains.

The firm also benefited from being the only CPA practice in Black Mountain. “We’re the only people here that can provide this service now,” Goodman notes, which helped with client retention during the transition.

Building Systems That Weather Storms (Literally)

By 2024, the firm had grown to 12 team members working in a hybrid model. Some work in the office, others are fully remote, and they even have team members in the Philippines. But their systems faced the ultimate test in September 2024 when Hurricane Helene hit.

“The eye of the storm went through our town,” Goodman explains. “About a 10th of a mile down from our house turned into a lake.” While their community was devastated, with power lines down and infrastructure destroyed, Goodman made a crucial decision.

“We’re like, well, we could take the server, take the networking equipment so people can VPN to the office, and we can set it up at my parents’ house in Roanoke, Virginia,” he recalls. “So we drove to Roanoke, plugged in the server, hooked it up to their internet, and then our team could work from my parents’ living room.”

This wasn’t just crisis management—it showed how the firm’s systems had evolved to handle unexpected challenges. The team maintained operations while their entire region struggled with basic utilities.

The Power of Peer Networks

Goodman’s discovery of peer communities happened almost by accident, but it became a game-changer for his business. During summer 2024, while mowing his lawn and trying to complete CPE requirements, he discovered he could listen to accounting podcasts instead of sitting through webinars.

“A friend of mine told me about Earmark to earn CPE with podcasts. I was like, ‘This is great. Now I don’t have to sit down for like a webinar or something,’” he explains.

That’s when he found the “Who’s Really the Boss?” podcast and heard discussions about fractional CFO services and team structures, and listening to the podcast helped him discover the team structure the firm needed to move toward.

The remarkable part? His firm had just overhauled its structure two months earlier. But instead of sticking with something that wasn’t working, Goodman brought the new model to his leadership team with complete honesty. A willingness to abandon recent work in favor of proven systems accelerated their growth significantly.

Current Focus and Future Goals

Today, Goodman’s firm operates with metrics and systems that would impress much larger practices. Team members earn performance bonuses based on four specific metrics: maintaining accuracy above 90%, achieving client satisfaction scores of 90% or above, keeping client retention at 90% or above, and completing month-end closes by the 15th.

The firm also specializes in serving direct primary care practices—doctors who’ve left the traditional healthcare system for a subscription-based model. “We really believe in what they’re doing and the model they’re building. So we’re trying to be the great back office so they can focus on patient care,” Goodman explains.

They’ve even hired a dedicated salesperson with a compensation structure of $50,000 base plus 8% on collected revenue and 4% on first-year residuals. It’s a sophisticated operation for a firm that’s only five years old.

The firm’s current focus is on process optimization and AI implementation to help their team work more efficiently. Their goal? A 36-hour workweek with half-day Fridays while maintaining their growth trajectory toward $2.5 million in revenue.

The Lessons That Matter

Looking back, Goodman’s transformation offers clear lessons for other firm owners:

Be willing to admit what you don’t know. “I’ve been surprised at how many people are relatively open with what they’re doing and willing and wanting to help you and your development,” he reflects. “And so just asking the question, asking for a virtual coffee has been extremely helpful.”
Find your community. The isolation of trying to figure everything out alone nearly destroyed Goodman’s business. Once he found coaching groups and peer networks, his growth accelerated dramatically.
Implement proven systems rather than reinventing them. Goodman’s breakthrough came when he stopped trying to create everything from scratch and started following blueprints that other successful firms had already tested.
Stay teachable. When Goodman discovered the team-of-three structure just months after reorganizing his firm, he didn’t let pride prevent him from making another change. That flexibility to adapt has been crucial to his success.

At 29 years old, Goodman is quick to acknowledge he still has much to learn. “I love to learn from people who have been here and done that,” he says.

His advice to other young firm owners facing similar challenges is simple: “Don’t stress out so much. It will work out.” But pair that with action: seek mentorship, join communities, and be willing to admit when you need help.

Your Next Step

Goodman’s story offers insights into pricing strategies, team structures, acquisition approaches, and the systems that enabled his dramatic growth. If you’re ready to move beyond struggling alone and start leveraging the collective wisdom of successful practitioners, listen to his full interview on “Who’s Really the Boss?

Sometimes the difference between eating rice and beans and building a multi-million dollar firm isn’t what you know; it’s your willingness to learn from those who’ve already walked the path.

The crisis that could have ended Goodman’s entrepreneurial dreams became the foundation for extraordinary growth. Your current challenges might be setting the stage for your own breakthrough if you’re willing to be teachable enough to find it.

Rachel and Marcus Dillon, CPA, own a Texas-based, remote client accounting and advisory services firm, Dillon Business Advisors, with a team of 15 professionals. Their latest organization, Collective by DBA, supports and guides accounting firm owners and leaders with firm resources, education, and operational strategy through community, groups, and one-on-one advisory.