As registered investment advisors push to offer more holistic financial planning, many are confronting a practical reality: building in-house tax capabilities is expensive, complex and often inefficient. Instead, a growing number are turning to partnerships with CPA firms as a faster, more flexible way to meet client demand.
A Middle Ground Between Referrals and Full Integration
Historically, many RIAs have taken a hands-off approach, referring clients out to trusted CPAs and coordinating as needed. But that model has its limits, particularly when it comes to growth.
“Up until just recently, we had been referring clients to CPAs and then coordinating tax filing/planning advice for our clients,” said Lisa Kirchenbauer, founding partner and senior advisor at Omega Wealth Management in Arlington, Virginia. “In one case, we have maybe 25 mutual clients with one CPA firm which has been good but virtually no referrals over many years.”
That experience has prompted her firm to rethink the relationship. Omega Wealth Management is now exploring more formalized partnerships that include revenue sharing in both directions — a shift that reflects a broader industry trend toward deeper alignment between advisors and tax professionals.
Keeping it Separate, by Design
For some advisors, independence remains a priority. Rather than formalizing partnerships, they choose to maintain a network of CPAs and match clients based on their needs.
“We prefer to keep our CPA relationship separate but coordinate tax planning,” said Crystal McKeon, chief compliance officer at TSA Wealth Management in Houston. “We work with the CPAs on the client’s plan but do not exchange any funds or formal agreements.”
That approach allows for flexibility, particularly across different client segments. McKeon said her firm works with a range of CPAs depending on complexity, from ultra high net worth specialists to professionals focused on business owners or more straightforward tax returns.
When Close Partnerships Falter
Other firms take a more integrated approach, building long-term relationships with a single CPA firm to deliver a coordinated client experience.
David Demming, founder and principal of Demming Financial Services in Aurora, Ohio, said his firm benefited from such a partnership for decades.
“We have partnered closely with one CPA firm where a senior partner closely worked with us,” he said. “Our clients got great service and coordination between firms.”
But even successful partnerships can be fragile. When that CPA partner retired, the dynamic changed.
Why Not Just Build Tax Services In-House?
For some RIAs, the obvious alternative to partnerships is to bring tax preparation and planning under their own roof. But that path remains uneven across the industry.
Research shows that while about 1 in 6 firms now offer tax preparation, adoption is heavily skewed toward larger RIAs. A Financial Planning survey found that firms with more than $500 million in assets are more than twice as likely to use tax software as those under $100 million, reflecting the scale required to make the economics work.
Even large firms often find limits to what they can handle internally, particularly when clients have complex business structures or specialized tax needs. In those cases, outside expertise remains essential.
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