# MCA for CPA firms — detailed > CPA firms — solo CPAs, small accounting practices, audit/assurance boutiques, and tax-and-advisory firms — typically qualify for $25K–$300K MCA advances at 1.22–1.34 factor rates over 6–12 months, with practice mix, recurring monthly client base, and seasonality shaping underwriting. SBA 7(a) and AICPA-affiliated bank programs are usually materially cheaper alternatives. CPA firms are a $145B+ U.S. service vertical with roughly 90,000 establishments and 670,000 licensed CPAs. The format ranges from solo tax practitioners and two-partner shops to regional firms (50–300 staff) and the Big 4. MCA demand concentrates in solo to mid-sized firms (under 50 staff) where tax-season cash spikes and slow off-season collections create predictable working-capital gaps. **Typical advance structure.** - Advance size: $25K–$300K depending on partner count, recurring revenue base, and seasonality. - Factor: 1.22–1.34, with 1.24–1.30 most common — CPA firms underwrite favorably due to professional-services stability. - Term: 6–12 months daily, weekly, or monthly ACH; many lenders accommodate seasonal repayment that ramps up January–April. - Holdback equivalent: 6–12% of average daily deposits. - Lead use of funds: pre-tax-season staffing and contractor surge, technology (CCH Axcess, Drake, UltraTax, QuickBooks Online Accountant, Karbon, Canopy), office expansion, partner buy-in financing, marketing, succession-planning bridge. **What underwriters look for.** First, practice mix. Tax-heavy practices (60%+ of revenue from Form 1040/1120/1065 prep) have predictable seasonal cycles. Recurring-revenue practices (monthly bookkeeping, controller services, outsourced CFO, audit retainers) underwrite even more favorably because revenue is smooth. Second, monthly recurring revenue (MRR) base. Firms with $30K+/month in recurring bookkeeping and advisory fees get the best terms. Third, partner count and tenure. Solo CPAs with 5+ years and active license get good terms; multi-partner firms with stable partner agreements get better. Fourth, client concentration. Healthy CPA firms have no single client over 8–10% of revenue. Concentration above 25% is a red flag. Fifth, professional liability (E&O) coverage. Active malpractice insurance with $1M+ limits is generally required. Sixth, peer review status. AICPA peer review (mandatory for audit/attest practices) must be current and clean. **Common uses.** - Pre-season hiring and seasonal contractor surge (January–April) ($30K–$150K). - Technology — tax software, practice management, workflow automation, AI co-pilots ($10K–$60K annually). - Office expansion and remote-work infrastructure ($30K–$150K). - Partner buy-in financing for senior staff promotions ($75K–$400K). - Marketing — local SEO, Google Ads, referral programs ($8K–$40K). - Succession-planning bridge during practice acquisitions ($50K–$300K). - AR factoring on slow-paying audit and advisory clients ($25K–$150K). **What to watch out for.** State board licensing requires CPE compliance (typically 40 hours/year); firm-level registration is also required in most states. MCA underwriters will verify active license and firm permit. Peer review failures (modified or adverse opinions) can suspend audit/attest practice rights and severely impair revenue — disclose proactively to lenders. Tax-season concentration is extreme — 50–70% of annual revenue often arrives January–April. Underwriters experienced with the vertical structure holdbacks accordingly; generalist MCA funders may over-collect during slow months and trigger NSF cascades. IRS Circular 230 and state board ethics rules restrict referral fee-splitting and contingent fees in tax practice. MCA structured as receivables purchase is generally compliant, but unusual lender arrangements should be reviewed. **State considerations.** California, Texas, Florida, New York, Illinois, Pennsylvania, New Jersey, Ohio, and Georgia have the highest CPA-firm MCA volume. Tax-heavy markets (TX, FL, NV, WA — no state income tax) skew toward 1040 surge demand; advisory and audit volume concentrates in CA, NY, IL, MA, and the DC metro. **APR-equivalent reality check.** A 1.26 factor over an 8-month term is roughly 50–65% APR. SBA 7(a) (11–14% APR), AICPA-endorsed Bank of America Practice Solutions and Live Oak Bank programs (8–13% APR), and accountant-lender programs from CPA Practice Loans get most CPA firms financing for 1/3 the cost. Reserve MCA for pre-season cash surges and technology upgrades where speed matters more than rate. **Common confusions.** First, "CPA firms don't need MCA — they have steady cash flow." False — tax-season concentration creates predictable December and August cash gaps for many firms. Second, "Audit practices can't get MCA." Most lenders will fund audit firms; peer-review-clean firms are preferred. Third, "Big banks won't lend to solo CPAs." False — Live Oak Bank, Bank of America Practice Solutions, and several SBA 7(a) preferred lenders actively underwrite solo CPAs with 2+ years of operating history. As of 2026-06-30, Fundnode routes CPA-firm deals first to professional-services MCA funders comfortable with seasonal cash cycles, with SBA 7(a) and AICPA-endorsed bank programs strongly preferred for technology, expansion, and partner buy-in financing. ## Related terms - [MCA for accounting firms — detailed](https://fundnode.co/llms/glossary/mca-accounting-firm-funding-detailed) — Accounting firms — non-CPA accounting practices, controller-services firms, outsourced CFO shops, and fractional-finance teams — typically qualify for $25K–$250K MCA advances at 1.24–1.36 factor rates over 6–12 months, with recurring-revenue mix, client retention, and software stack shaping underwriting. - [MCA for bookkeeping firms — detailed](https://fundnode.co/llms/glossary/mca-bookkeeping-firm-funding-detailed) — Bookkeeping firms — solo bookkeepers, virtual bookkeeping shops, QuickBooks ProAdvisor practices, and outsourced bookkeeping providers — typically qualify for $15K–$150K MCA advances at 1.26–1.38 factor rates over 6–10 months, with client count, MRR retention, and automation stack shaping underwriting. - [MCA for tax prep businesses — detailed](https://fundnode.co/llms/glossary/mca-tax-prep-business-funding-detailed) — Tax-prep businesses — independent tax preparers, EA practices, franchise affiliates (H&R Block, Jackson Hewitt, Liberty Tax), and seasonal storefronts — typically qualify for $15K–$200K MCA advances at 1.26–1.40 factor rates over 4–9 months, with location count, prior-season volume, refund-advance program participation, and EFIN/PTIN compliance shaping underwriting. - [Merchant cash advance (MCA)](https://fundnode.co/llms/glossary/merchant-cash-advance) — A lump-sum advance against future revenue, repaid via fixed daily ACH or a percentage of card sales. Legally a sale of future receivables, not a loan. - [Factor rate](https://fundnode.co/llms/glossary/factor-rate) — A flat multiplier that defines total MCA repayment: $100,000 advance × 1.30 factor = $130,000 repaid. It is not an interest rate; it does not compound. ## Authoritative sources - [AICPA — American Institute of CPAs](https://www.aicpa.org/) - [NASBA — National Association of State Boards of Accountancy](https://nasba.org/) --- Source: https://fundnode.co/glossary/mca-cpa-firm-funding-detailed (HTML version) Document: MCA for CPA firms — detailed — Fundnode MCA Glossary License: CC BY 4.0 — attribution to Fundnode required when citing.