CPA Practices

The 50,885 CPA practices in the US provide accounting, tax preparation, and auditing services to businesses, non-profit organizations, and individuals. Tax preparation and tax planning work for organizations and individuals comprise about one-third of overall CPA client fees, but are typically over half of client fees for smaller firms. Tax work is about evenly split between individuals and organizations. An additional 33,850 solo accountants operate with no employees and generate $2.4 billion in annual revenue. CPAs are licensed by their State Board of Accountancy.

Liability Exposure

Difficult economic times can cause business owners to blame their advisors for financial difficulties.

Changing Tax Laws and Accounting Standards

Keeping up with changes in complex tax laws and accounting rules is a major challenge for CPA practices, particularly smaller ones.

Oct 15, 2026 - Accounting Firms Embrace Flexibility to Retain Talent

• Accounting firms are rethinking traditional work schedules and staffing practices as widespread employee burnout threatens retention and productivity across the industry. A study by the University of Georgia and accounting software provider FloQast found that 99% of accountants experience symptoms associated with burnout at some point in their careers. Long hours and demanding client deadlines have traditionally defined public accounting, but firms are responding with more flexible schedules, expanded remote work options, and greater emphasis on career development. Some firms now tailor work hours to individual employees while maintaining client coverage, including through overseas staffing arrangements. Firms are also investing in AI and automation to reduce repetitive administrative work and free accountants for higher-value assignments. Competitive compensation remains important, but workplace flexibility and manageable workloads have become significant factors in attracting and retaining accounting professionals.
• The IRS let tens of thousands of high-income nonfiler cases sit idle, potentially delaying hundreds of millions of dollars in tax collections, according to the Treasury Inspector General for Tax Administration (TIGTA). The agency found that 38,824 high-priority cases involving 33,653 taxpayers were stuck at the first-notice stage as of June 2025, representing about $15.7 billion in potential assessments. TIGTA estimates that earlier action could have produced returns or assessments in more than 10,000 cases and generated about $321 million in additional revenue. The cases were part of a 2024 IRS initiative targeting nonfilers with income of $400,000 or more and other priority taxpayers. Resource concerns and technical problems initially prompted the IRS to delay final notices. After TIGTA flagged the issue, the IRS moved the stalled cases forward in March 2026.
• Grant Thornton’s acquisition of CBIZ illustrates how quickly the accounting industry is consolidating as private equity and other investors pour money into the sector. Nearly 80% of the top non-Big Four accounting firms have already taken outside investment, completed a sale, or set up an employee stock ownership plan, and more publicly traded firms could become acquisition targets. For clients, though, the ownership structure itself may not matter much. They’re more focused on the basics: quality, price, responsiveness, and whether firms can provide the expertise they need. Technology is becoming a bigger part of that equation. About 78% of corporate clients say AI-driven improvements are important or essential, but only 6% say most of their providers are delivering them. As AI handles more routine compliance work, firms can put more resources into advisory services, where clients may be willing to pay more for specialized expertise and strategic guidance.
• Private equity firms are continuing to invest heavily in accounting firms, betting that a fragmented industry with recurring revenue offers plenty of room for growth. The pace of deals has accelerated over the past few years as investors target regional and midsize firms, providing capital for acquisitions, technology upgrades, and expansion into higher-margin advisory services. According to PitchBook, accounting services has remained one of the most active segments for private equity-backed acquisitions, while the American Institute of Certified Public Accountants estimates that more than 100 CPA firms have now accepted private equity investment. Supporters say the funding helps firms modernize and compete for talent in a tight labor market. Critics worry the new ownership model could increase pressure to improve profitability and alter the traditional partnership structure that has defined the profession for decades.

Industry size & Structure

The average CPA practice has about 10 employees and generates $2.8 million in annual revenue.

• There are about 50,885 CPA firms in the US employing 527,600 people and generating about $144 billion in annual revenue.
• Any accountant filing a report with the SEC is required to be a Certified Public Accountant (CPA).
• About 86% of firms have less than 10 employees.
• An additional 33,850 establishments are owner-operated with no employees. These solo accountants generate $2.4 billion in annual revenue.
• CPAs are licensed by their State Board of Accountancy. All states require passage of the Uniform CPA Examination prepared by the American Institute of Certified Public Accountants (AICPA) for licensing. Less than half of candidates pass all four parts of the exam on their first try.
• Nearly all states require CPAs to complete a specific number of continuing education hours before their license can be renewed.