📅 2026 Update: Changes in Business Accounting and CPA Licensing

Since the original article was published, there have been important updates in business accounting and CPA licensing that affect small businesses. For instance, new requirements for tax accounting methods and CPA licensure pathways are now in place. The following sections highlight these key changes relevant to running a small business.

📊 Accrual Basis Accounting Requirement

Starting in tax year 2026, C corporations, partnerships with a C corporation as a partner, and tax shelters with average annual gross receipts exceeding $32 million must use the accrual method for federal tax purposes. This method records income and expenses when they are earned or incurred, not when cash is exchanged. This change can significantly affect how larger small businesses report their finances.

📝 CPA Licensure in Minnesota

Effective January 1, 2026, Minnesota has introduced multiple pathways to obtain CPA licensure. This provides more options for candidates seeking to become certified public accountants. Each state has its own requirements, so candidates should check local regulations to find the best path for their situation.

⏳ Business Formation Processing Times

Processing times for business formation documents can vary widely. Typically, this can take anywhere from a few days to several weeks, depending on the state and whether the application is filed online or by mail. Small business owners should plan accordingly to avoid delays in starting their operations.

📅 Deadlines for Reporting Changes

Businesses are required to report any changes in responsible parties within 60 days by completing Form 8822-B. This form must be mailed to the address specified on it. Keeping track of such deadlines is crucial for compliance.

📌 Key Takeaways

  • For tax year 2026, certain businesses must use the accrual method for accounting.
  • New pathways for CPA licensure are available in Minnesota.
  • Business formation processing times can range from a few days to several weeks.
  • Changes in responsible parties must be reported within 60 days using Form 8822-B.
  • Consider utilizing resources from the Small Business Administration or IRS for guidance.

💡 Tips for Small Business Accounting

Review the details of your situation with an attorney to ensure compliance with current laws and regulations.

📈 Understand the Accrual Method

Businesses affected by the new accrual accounting requirement should familiarize themselves with how it operates. This method affects how income and expenses are recorded, which can impact financial reporting and tax obligations.

🏢 Choose the Right Business Structure

Selecting the appropriate business structure is crucial. The structure you choose will influence your tax responsibilities and personal liability, so consider your options carefully.

⏳ Prepare for Processing Times

When forming a business, be aware of the potential processing times for your state. Allow for extra time in your planning to ensure you can start your business smoothly.

📅 Meet Reporting Deadlines

Keep an organized system to track important deadlines, especially for reporting changes. Missing deadlines can lead to penalties or compliance issues.

🤝 Utilize Free Resources

Take advantage of free resources offered by the Small Business Administration and the IRS. These organizations provide valuable information for new business owners.

🏆 Business Accounting Services Ranked by User Reviews (2026)

This section highlights services that help with business formation and accounting, which are crucial for small businesses. The rankings are based on Trustpilot data as of October 2026. Ratings can change, and customer experiences vary widely.

Ratings are just one factor to consider, as unhappy customers often leave more reviews.

🥇 1. LawDepot

LawDepot holds a Trustpilot score of 4.0. It is known for creating legal documents, including estate planning and business formation documents. Some users have reported issues with customization options, which may affect your experience if you need specific document adjustments.

🥈 2. ZenBusiness

ZenBusiness has an impressive Trustpilot score of 4.8. This service specializes in business formation, registered agent services, and compliance assistance. While many users praise its efficiency, some have noted occasional delays in processing times.

🥉 3. LegalZoom

LegalZoom averages a Trustpilot score of 4.6. It is well-known for its business formation services, estate planning, and intellectual property registration. However, some customers have reported delays in customer support response times, which can be a drawback for urgent needs.

4️⃣ Bizee

Bizee holds a Trustpilot score of 4.8 and has received reviews**. This service focuses on business formation, compliance, and registered agent services. While it has received high ratings, some users have mentioned issues with the user interface that could affect usability.

5️⃣ Rocket Lawyer

Rocket Lawyer has a Trustpilot score of 4.5. It offers online legal services, document preparation, and legal advice. Some customers find the subscription model less cost-effective if they only need infrequent services.

🆓 Free Government or Nonprofit Help

Businesses can access free resources from the Small Business Administration (SBA) and the IRS. The SBA provides counseling and resources for entrepreneurs, while the IRS offers guidance on tax obligations. These resources can be invaluable for new business owners seeking support.

🔎 What to Compare When Choosing Accounting Services

  • 📄 Types of services offered, like business formation or compliance.
  • 💰 Fees and total costs associated with formation and filing.
  • ⏳ Average processing times for documents.
  • 💬 Customer reviews and overall satisfaction ratings.
  • 🌐 Availability of free resources and assistance.

❓ Frequently Asked Questions

❓ What is the accrual method of accounting?

The accrual method records income when it is earned and expenses when they are incurred, regardless of cash movement. Starting in 2026, certain businesses must use this method for federal tax purposes.

🏢 What are the benefits of choosing an LLC?

Forming an LLC provides limited liability protection for owners, meaning personal assets are generally protected from business debts. This structure also allows for flexible management and tax options.

📅 How long does it take to form a business?

Processing times for business formation can vary by state. It generally takes from a few days to several weeks, depending on the filing method chosen.

📝 What are the requirements for CPA licensure?

Requirements for CPA licensure vary by state but typically include education, examination, and experience criteria. Some states, like Minnesota, have introduced multiple pathways to obtain licensure.

💼 Do I need an EIN for my business?

Most businesses require an Employer Identification Number (EIN) to identify themselves for tax purposes. This number is essential for hiring employees and filing taxes.

📅 What is Form 8822-B?

Form 8822-B is used to report changes in a business's responsible party. Businesses must complete and mail this form within 60 days of any changes to maintain compliance.

⚖️ Recent Court Cases Related to Business Accounting

Recent court rulings have clarified various aspects of business accounting and compliance, impacting how small businesses operate.

For more insights, feel free to browse more rulings on the news page.

End of October 2026 Update





It is vital for a business to organize its finances and ensure that all information regarding its financial position is in order. Without the proper accounting records, a business may not be aware if it is losing money. 

Many corporations rely on professional accountants to track the financial progress of the company. Small business owners more commonly record their financial transactions using business accounting software.

There are a variety of different types of business accounting software available for individuals to purchase. Beforing acquire any type of accounting software, it is important for a business owner to carefully review the features offered by this software in order to ensure that the program will allow him/her to accomplish all necessary accounting tasks.

Business Accounting Software for Small Businesses

Today, the most common business accounting software is Intuit QuickBooks. Many businesses and companies require that individuals have experience with this software in order to be considered for office or administrative positions. QuickBooks provides businesses with the tools to accomplish most necessary procedures, including check deposit, payroll processes, invoice customization, storing and organizing business documents and customer information, and marketing, just to name a few.

Despite its widespread popularity, QuickBooks is not the only business accounting software available. Simply Accounting Software and Peachtree Complete Accounting Software are also popular types of business accounting software available for the public to acquire. An individual should review the different features offered by all of the available software and locate the business accounting software that is best suited for his/her company.