Accounting for Professional Services
Tax planning and accounting built for consultants, agencies, and independent professionals who run their own practice across Garden City and Long Island.
When you are the business, your tax plan is your bottom line.
Consultants, agency owners, architects, engineers, and independent professionals carry a tax burden that ordinary employees never see: self-employment tax, quarterly estimates, and a constantly shifting set of deductions tied to how the practice is run. The same income can leave very different amounts in your pocket depending on your entity, your retirement plan, and how cleanly the books are kept. JRH & Associates works with professional service firms throughout Long Island and the tri-state area, and we help you keep your structure and your taxes working in your favor.
Reviewed by James R. Hurley, CPA · June 2026
Self-employment tax and the S-corp election
Profit from a consulting practice or agency is subject to self-employment tax on top of regular income tax, and when you work for yourself you pay both the employer and employee halves. Once your profit reaches a meaningful level, electing S-corp taxation lets you split your income into a reasonable salary and distributions, with only the salary portion exposed to those payroll taxes. That split can save thousands each year, but it adds payroll filings and a separate return, so it only pays off above a certain threshold. We calculate the break-even on your actual numbers and handle the election and the ongoing compliance if it makes sense.
Quarterly estimated taxes
No employer is withholding tax from your earnings, so the IRS expects you to pay throughout the year through quarterly estimates, generally due in April, June, September, and January. Miss them or underpay and you face penalties even if you pay in full at filing. We project your income across the year, build in self-employment tax, and set each quarterly figure so your cash flow is predictable and April never brings a surprise. As your income grows or your practice changes, we adjust the estimates so they stay accurate.
Home-office and business deductions
Professionals who work from home or a dedicated office have a wide range of deductions available, and capturing them correctly is one of the simplest ways to lower your tax bill. A qualifying home office lets you deduct a share of rent or mortgage interest, utilities, and insurance. Beyond that, software and subscriptions, professional development, licensing and association dues, business travel, equipment, and a portion of phone and internet all reduce taxable income. We make sure every legitimate expense is captured and documented so it stands up to scrutiny, and we keep your books clean enough that nothing slips through.
Choosing the right entity
The way you hold your practice shapes your liability, your taxes, and your paperwork. A sole proprietorship is the simplest but offers no liability protection. An LLC adds that protection while staying flexible, and licensed professionals in some fields form a PLLC. Layering an S-corp election on top of an LLC can reduce self-employment tax once profits are high enough. We help you weigh liability protection, tax treatment, and administrative simplicity, then set up the structure that fits your practice today and revisit it as you grow.
Retirement plans for owners
One of the largest tax breaks available to a self-employed professional is funding the right retirement plan. A SEP-IRA is simple and lets you set aside a percentage of net earnings with almost no paperwork. A Solo 401k allows larger contributions at lower income levels and supports Roth and loan features for owners with no full-time employees beyond a spouse. High earners can shelter far more through a defined benefit or cash balance plan. We match the plan to your income and cash flow so you reduce this year's taxes while building real wealth for the future. Explore our full range of services or book a free consultation, and see how we also work with law firms and medical and dental practices.
Every kind of professional practice.
Consultants & Coaches
Independent advisors and coaches who need entity planning, estimates, and a deduction strategy that fits solo work.
Marketing & Creative Agencies
Agencies managing project income, contractors, and payroll who want clean books and a smart tax structure.
Architects & Engineers
Design and engineering firms balancing project billing, licensing costs, and entity choices like the PLLC.
IT & Freelance Professionals
Developers, technologists, and freelancers with 1099 income who need self-employment tax and retirement planning.
"When you are the business, every dollar of profit runs through your own tax return, so the structure has to be right. The professionals who keep the most are the ones who pick the correct entity, fund a retirement plan, and treat their quarterly estimates as part of running the practice, not an afterthought in April."
James R. Hurley, CPA Founder & President, JRH & Associates Common professional services tax questions.
Many consultants and agency owners start as a single-member LLC for its simplicity and liability protection, then elect S-corp taxation once profits are high enough to justify it. As an S-corp you pay yourself a reasonable salary and take the rest as distributions, which are not subject to self-employment tax. That split can save several thousand dollars a year, but it only makes sense above a certain profit level and it adds payroll and filing requirements. We run the numbers on your specific income and tell you where the break-even is.
When no employer withholds tax for you, the IRS expects you to pay as you earn through quarterly estimated payments, generally due in April, June, September, and January. Underpaying triggers penalties even if you settle up in April. We project your income, factor in self-employment tax, and set each quarterly figure so you stay penalty-free and never face a surprise balance when you file.
Yes. If you use part of your home regularly and exclusively for your practice, you can deduct a portion of rent or mortgage interest, utilities, and insurance, either by the simplified square-foot method or actual expenses. Beyond the home office, professionals routinely deduct software and subscriptions, professional development, licensing and dues, a portion of phone and internet, business travel, and equipment. We make sure every legitimate deduction is captured and documented so it holds up.
Self-employment tax covers Social Security and Medicare, currently 15.3 percent on net self-employment earnings, on top of regular income tax. As an employee your employer pays half, but on your own you pay both halves. The most common way to reduce it is the S-corp election, which only taxes your salary portion for these purposes. Maximizing business deductions and funding a retirement plan also lower the income that gets taxed. We build a plan that uses each of these levers where it fits.
It depends on your income and whether you have employees. A SEP-IRA is simple and lets you contribute a percentage of net earnings with almost no paperwork. A Solo 401k allows larger contributions at lower income levels and supports Roth and loan features, but suits owners with no full-time employees other than a spouse. For high earners a defined benefit or cash balance plan can shelter far more. We match the plan to your income, your goals, and your cash flow.
Build a tax plan that fits your practice.
Schedule a free consultation and we will review your entity, your estimates, and the strategies that can lower what you owe as a professional.