CPA Salary Guide: How Much You Can Earn?

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A CPA's salary is often in the high five figures, with senior CPAs in management earning six figures. So, whether you're a college graduate with a bachelor's degree in finance or accounting, or an entry-level accountant looking for a higher wage and additional job responsibilities, you should consider acquiring a certified public accountant certificate.

If you're an accountant, you'll see that a CPA's income is usually greater, and so this credential will help you advance in your career. A CPA certification provides access to a variety of rewarding employment. Obtaining a CPA certification (and a CPA salary) necessitates a major time and energy investment, not to mention a commitment to continuous education, so it's vital to comprehend the possible payoff before pursuing it.

CPAs work in a variety of sectors, including forensic accounting, tax preparation, auditing, bookkeeping, and information technology, in both the commercial and public sectors, as well as for the federal government. Being a CPA may lead to a career as a chief financial officer or a highly-paid tax accountant with the appropriate amount of experience.

Although the U.S. Bureau of Labor Statistics (BLS) does not separate CPA wages from its data on accountants and auditors, the American Institute of CPAs (AICPA) mentions a Robert Half report stating a credentialed CPA often makes more.

In 2021, the median compensation for an accountant was $77,250.

Accounting vs. CPA Careers

Although all CPAs are accountants, not all accountants are CPAs, and becoming an accountant is simpler than becoming a CPA. The AICPA, which administers and grades the CPA exam, claims that most states permit anyone to use the term "accountant." However, in addition to passing the Uniform CPA Exam, CPAs must also satisfy "educational, experience, and ethical requirements" in order to be awarded a license.

Along with any other state-specific criteria, candidates have to complete 150 semester hours of education. This necessitates having a bachelor's degree, taking graduate-level courses, obtaining a master's degree in accounting, or earning an MBA with a focus in accounting, depending on the courses you choose.

In the end, businesses value the higher standard that CPAs are held to. Only CPAs who have obtained their licenses are qualified to carry out the necessary audits at public corporations.

Because of the rigorous criteria of the CPA qualification, they are often better educated than their counterparts. Keeping this in mind, broad accounting salaries are deceptive. A significant distinction between an ordinary accountant and a CPA is that only the latter can prepare an audited financial statement. This is a major reason why CPAs are in high demand in large corporations that require audited financial statements.

Certified public accountants can seek employment in multinational financial corporations or the government and often earn more than non-certified accountants.

According to the Bureau of Labor Statistics, the median U.S. pay for accountants and auditors in May 2021 was $77,250, with persons in the lowest 10% earning less than $47,970 and those in the highest 10% earning more than $128,970.

That's a wide range because the word "accountant" encompasses people with varying levels of responsibility. CPAs are often senior accountants and auditors with significant degrees of responsibility. CPAs are often on the higher end of this compensation range due to their increased obligations. According to the American Institute of CPAs, CPAs may have greater flexibility than their counterparts due to the cyclical nature of their profession.

Accounting Salary Ranges

Accounting professionals without a CPA credential can find a variety of job opportunities and salaries.

Bookkeeping, Tax Preparation, and Payroll Services

According to the BLS, the median annual salary for accountants providing accounting, tax preparation, and payroll services in 2021 was $77,080.

Insurance Companies and Finance

Accounting firms that provide general services to insurance companies and enterprises with a financial concentration compensate their accountants handsomely. The median annual pay is somewhat greater than those who work in tax preparation, at $79,310, according to the same BLS statistics cited above.

Government Jobs

Government accounting jobs provide a handsome median annual income of $77,290. By 2020, the government employed around 8% of all accountants and auditors.

Junior Tax Associate/Accountant

Many accounting graduates can work as junior tax associates or accountants right away. Tax-related professions can provide a platform for more lucrative positions. A junior tax associate must be knowledgeable with federal, state, and local tax laws as well as how to file tax returns and other documentation for businesses or people. The BLS reports that in 2021, the median yearly wage was $56,780.

CPA Salary Ranges

The typical salary for most accounting graduates will be well below that of a CPA because most people pursue a CPA to take on more responsibility and management roles. An analysis of information from all CPA job posts on the employment website Indeed revealed an average base pay of $79,316 in 2022.

The Accounting Institute for Success claims that top-tier CPAs can make up to $150,000 annually. Additionally, gaining the knowledge and training necessary to become a CPA can open doors to various career paths like that of a business comptroller or certified financial officer.

Entry-Level CPA

The typical salary for entry-level CPAs ranges from $46,000 to $68,000, according to the Accounting Institute for Success, depending on the size of the organization.

Senior-Level CPA

A CPA with more than four years of experience may earn $66,000 to $110,000, depending on their expertise.

Manager or Director with a CPA

The U.S. Bureau of Labor Statistics estimates that top executives make between $60,300 and $208,000 annually. Executive management positions are another top position for CPAs with experience, and these positions can pay six figures.

The median salary for top executives in 2021, as reported by the BLS, was $179,520.

Average CPA Salary by State

Like other professionals, CPAs' wages may vary depending on where they work. Employment opportunities differ according to the type of accounting specialization.

According to the BLS, Texas, California, New York, Florida, and Pennsylvania have the highest employment and pay rates for accountants in the United States. Keep in mind that this data reflects accountant wages, as the BLS does not separate CPA and ordinary accountant jobs. According to the most recent annual BLS data from May 2021, the average CPA salary in these top five states is as follows: New York ($105,790), Texas ($85,860), California ($92,840), Florida ($76,320), and Pennsylvania ($79,200).

How Much Does a CPA Make Yearly?

It is determined by where you live and work. A CPA in New York may earn more than $100,000, yet a junior accountant in another state may earn less than $50,000 on average.

Can CPAs Make Six Figures?

Typically, senior CPAs in management roles make more than $100,000 per year. Most CPAs can anticipate earning well into the six figures.

What Are CPA Salaries at the Big 4?

The "Big Four" refers to the four largest accounting companies in the United States based on revenue: Deloitte, Ernst & Young (EY), PricewaterhouseCoopers (PwC), and KPMG.

All four enterprises provide tax and management consultancy, legal advice, valuation, market research, and assurance. The 25th percentile of accounting wages for all four organizations, according to ZipRecruiter, is approximately $70,000, while the 75th percentile is over $125,000. The national average is around $100,000, albeit the data does not expressly state the average pay of CPAs.

Is a CPA a Good Career?

Yes, if you enjoy mathematics, taxes, and accounting. Certified public accountants are often in great demand, with a proficient CPA commanding a high five-figure remuneration. Furthermore, if they chose not to work for a huge corporation, they could open their own business. This profession provides employment prospects in a variety of public and private sectors, ranging from government to IT.

CPAs are in high demand and usually better educated than regular accountants, although typically work long hours, especially during tax season. Higher earnings sometimes imply increased duties at work, which may induce stress, however, this varies from person to person.

Conclusion

Many accounting experts believe that becoming a CPA is a smart choice. Nonetheless, it makes the most sense for people looking to further their careers in accounting. Earning a CPA credential, and hence a good CPA income, requires time and effort.

CPAs are required by employers for many senior-level finance roles because they demonstrate passion and intellect. As a result, the biggest monetary advantage of a CPA may come years later. Non-management CPAs should expect to make up to 15% more than their peers, but they can also expect longer hours and more responsibilities and pressure.