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The contentious 150-hour rule — the number of college credit hours required to sit the CPA exam — has been a sticking point in the profession since it became the standard in the 1990s. With an ongoing talent crisis, uncompetitive salaries and rising education costs further weakening the inflow of new professionals, is the end of the rule the first step to changing the tide?
Median annual salaries for entry-level accountants hover around $65,000, according to 2024 research by Accounting Today. It’s not until the managerial tier that accountants can start to earn six figures on average.
Next to lower wages, many have suggested that the time required to pursue a CPA license has been a major hurdle driving prospective talent into other financial services. As a result, the American Institute of CPAs and the National Association of State Boards of Accountancy have started to guide states through adopting additional licensure pathways.
These efforts have been met with optimism from state CPA societies and accounting students alike, but misconceptions have also been brought to light from those critical of such efforts. Top concerns range from “We are lowering the standards,” to “This licensure change alone will solve the talent shortage.”
Susan Speirs, chief executive of the Utah Association of CPAs, said that while the passage of a CPA licensure bill in the state is a good first step to address the talent shortage across the profession, it’s hardly the last.
“My hope would be that we can start discussing the real issues surrounding our profession such as firm models, salary models, image models, CPE models, PE models and more before the profession implodes on itself,” Speirs said.
For Calvin Harris, chief executive of the New York Society of CPAs and a CPA who was licensed more than 20 years ago, a return to the former 120-hour standard isn’t as outlandish as it sounds.
“Where we’ve landed here in New York is that while we will continue to offer the pathway of 150 credit hours, we thought it was right to add back the 120-hour pathway,” Harris said. “In many ways it’s new since it hasn’t really been active, at least in New York, for more than two decades. But it’s also a return to a pathway [that previously existed].”
Senate Bill S6891 was introduced on March 26 by Senator Toby Ann Stavisky, D-N.Y., who chairs the committee on higher education. If passed, it would allow those pursuing CPA licensure in the state to be eligible with a bachelor’s degree (120 credit hours), two years of professional experience and a passing grade on the CPA exam.
Regarding perspectives that lowering the credit hour threshold would yield less skilled accounts, Harris said that the total six years spent pursuing the accreditation has not and would not change. What would change is a contentious fifth year in school that could be a financial make-or-break for some students.
“We’re talking about socioeconomic barriers,” Harris said. “From a diverse profession perspective, we also see where that fifth year burdens underrepresented groups on a higher level.”
Leaders with the state CPA societies of Iowa and California have similar sentiments regarding the “extra” 30 hours spent towards a CPA license, and how the financial burden of those hours takes a different toll on underrepresented groups.
California’s AB 1175 sets out to create “more accessible, flexible and affordable pathways, especially for those from underrepresented backgrounds and second-career individuals, while still upholding high standards,” said Denise LeDuc Froemming, CEO of CalCPA.
Dive into more coverage of the topic and the broader implications of the 150-hour rule below.
AICPA, NASBA mull alternative pathways to CPA licensure
In February, the American Institute of CPAs and the National Association of State Boards of Accountancy introduced proposed changes to the Uniform Accountancy Act model legislation that would provide states with codified language for drafting CPA licensure-focused bills.
Both organizations called upon the joint UAA committee to draft templated law language that involves a bachelor’s degree plus two years of experience as a state-determined pathway to licensure that incorporates a broad role for experience and individual-based practice privilege that incorporates a CPA’s ability to practice across state lines.
“The accounting profession has seen a remarkable convergence in recent weeks of stakeholders around flexibility that creates greater access for those who are interested in pursuing a career in accounting,” Susan Coffey, CEO of public accounting at the Association of International Certified Professional Accountants, told Accounting Today.
Could alternatives to the 150-hour rule create new talent pipelines?
For more than 20 years, the 150-credit hour rule for becoming a CPA has been the standard across the profession. But as a dwindling number of college students elect to major in accounting, combined with stagnating wages and the cost of higher education, that stands to change over the coming years.
Data gathered in a 2023 Center for Audit Quality study found that more than half of nonaccounting majors pegged higher starting salaries as the deciding factor for not studying accounting.
“If you just took [the Consumer Price Index] and applied it to the starting salary back in 1982, you’re very close to the starting salary of what the fifth-year students were a year ago, so the profession really hasn’t caught up,” Edward Wilkins, an accounting professor and former audit partner at a Big Four firm, told AT. “Did they ever really get credit for that fifth year if it was just a CPI adjustment?”
Ohio, Virginia among host of states pushing past 150-hour rule
While Ohio and Virginia were the first states to successfully pass legislation that creates new options for obtaining CPA licensure, they aren’t the last.
Utah Gov. Spencer Cox signed Senate Bill 15 into law on March 25, creating alternative pathways for accountants in the state seeking to become CPAs. Under the legislation, obtaining a license can be done through acquiring a bachelor’s degree with a concentration in accounting or business, two years of experience under the supervision of a licensed CPA and passing the CPA exam, or a master’s degree, one year of experience under the supervision of a licensed CPA and passing the CPA exam.
States with bills in progress include Illinois, Indiana, Massachusetts, Minnesota and others, many of which have the backing of their state CPA societies.
Iowa successfully adds new paths for CPA licensure
State legislators in Iowa, with the support of the Iowa Society of CPAs, have passed a bill that would create new alternatives for obtaining CPA licensure within the region.
House Bill 177 passed both chambers of the Iowa Legislature with a unanimous Senate vote, and is now in the hands of Gov. Kim Reynolds awaiting signing. In addition to CPA accreditation changes, the bill allows for those with CPA licenses from other states to practice within Iowa.
Any changes stemming from the bill would go into effect on July 1, 2026, upon Gov. Reynolds signing it into law.
“This legislation reflects a forward-thinking approach to licensure that preserves the integrity of the CPA while opening the door to more aspiring professionals,” ISCPA interim CEO Ardis Kelley said in a statement. “At a time when the profession is experiencing a decline of new licensees and increase in retirements, this is a much-needed step to attract new talent.”
Georgia CPA advocates successfully pass bill for CPA licensure
Among a host of states working to overhaul the traditional pathways to becoming a CPA, Georgia is one that has seen recent success.
House Bill 148, known as the Public Accountancy Act of 2025, was carried through the Georgia General Assembly with the support of the Georgia Society of CPAs on April 7. The bill introduces qualifications for CPA accreditation for those with a master’s degree in accounting or taxation and one year of relevant experience, or with a bachelor’s degree in accounting and two years of pertinent experience.
Also included are provisions for allowing out-of-state CPAs to practice in Georgia. The bill awaits signing by Gov. Brian Kemp.
“The new pathways to CPA licensure and expanded practice privilege mobility are essential steps toward addressing the growing demand for skilled accounting professionals,” GSCPA CEO Boyd Search said in a statement.
The tax reconciliation bill making its way through Congress is expected to add trillions of dollars to the national debt, but the Trump administration hopes to offset the cost through income from tariffs. Accountants are helping worried companies deal with the possible fallout.
“Obviously, tariffs create a lot of uncertainty,” said Tom Alongi, a partner and U.S. national manufacturing practice leader at UHY, a Top 50 Firm based in Farmington Hills, Michigan. “But with uncertainty for U.S. manufacturers, it creates a lot of opportunity. And for those that are contract manufacturers that use a lot of offshoring, it creates a tremendous amount of angst, especially among the auto industry that really over the last three decades has turned into a global supply chain as we’ve been in a race to the bottom to reduce costs.”
UHY has been helping CFOs deal with the changing tariff policies coming out of the White House. “A lot of companies don’t even realize how deep some of their supply chain and where some of their raw material and purchased components ultimately originate,” said Alongi.
That involves quantifying the impact, understanding the origin of components and raw materials, and where that fits in the Harmonized System that’s administered by the International Trade Administration, making sure everything is classified correctly.
The Trump administration hopes to convince more companies to relocate their manufacturing operations to the U.S. But companies are also looking at changing their sourcing to other countries if they’ve been relying too heavily on Chinese-made supplies amid the ever-changing tariff pronouncements.
“That uncertainty does create challenges within our clients of allocation of capital,” said Alongi. “Do I make big bets to transition if I have a huge amount of risk that is isolated in a certain country? What do we potentially do to mitigate that risk?”
Auto manufacturers need to look at the proposed changes to tax credits in the tax bill, including reductions in electric vehicle tax credits and other tax incentives for renewable energy.
“I always knew that it is a great alternative source that fits certain consumers, but I never believed that it was going to take over the world,” said Alongi, who has been driving an EV for over seven years. “The tax credits create a behavior, and they incentivize people to drive electric.”
The shortcomings in the national infrastructure for charging EV batteries disincentivize broader takeup, and the disappearance of the tax credits would make the vehicles even less affordable.
CBIZ, a Top 10 Firm based in Cleveland, launched an Integrated Tariff Solutions program earlier this month for its clients nationwide, offering support across finance, operations, supply chain strategy, tax and compliance.
“Like so many other middle-market companies, certainly the larger companies, in this environment, there’s more demand for advice on mitigating exposure,” said Mark Baran, managing director of CBIZ’s National Tax Office. “Tariffs have been relatively low for a long time, and now the supply chain, pricing, vendor relationships and locations of where goods are manufactured need a fresh look.”
Different industries are looking for help, including manufacturing, construction and import. “They’re really looking at how to mitigate these costs, which don’t appear to be slowing down,” said Baran. “It could be temporary, but it’s not right now. So we have developed a number of different avenues to assist our clients, whether it’s evaluating inventory and how to properly account for inventory, whether it’s seeking to help them find locations in the U.S. if they want to bring their manufacturing back to the U.S. and do that in a tax efficient manner. We’re looking at intercompany transactions and layering transfer pricing concepts onto customs, seeing if we could help with savings in that regard. Depending upon what a client does and their structure, there’s probably a number of ways you can tackle tariffs and get ahead of it. “
Customs valuations are important. “It’s really ensuring that you have an accurate customs valuation, and oftentimes that wasn’t looked at accurately, and there are savings that can result from that,” said Baran. “These are considered an intercompany framework, oftentimes on the businesses that are most impacted by this. Looking at that structure is another way of doing this, not just not just transfer pricing, but location-based analysis. It’s taking what has been decades of international tax knowledge and layering on customs, and that’s providing a framework that’s been tested and works and is valuable.”
Baran has also been keeping a close eye on developments with the overall tax legislation. House Republicans have come under pressure from President Trump to finalize the bill this week, but that won’t be the end of the story. “What’s waiting for them at the Senate tells me that this bill may not look the same because there’s already opposition from the Senate, and the Senate has a lot of rules that they need to follow,” said Baran. “The Senate has concerns, and the Senate instructions in the budget reconciliation concurrent resolution are very different than the House, so you may have a House and a Senate that’s producing two completely different bills. While it’s nice to report and discuss all of the changes that are coming out of the House, I think people should just keep in mind that the Senate is next, and do not assume that they will follow suit. So the ultimate bill that’s eventually produced is going to look a lot different than it does now.”
The fastest-growing accounting firms spend twice as much on their marketing budget than all other firms, according to a new study.
The Association for Accounting Marketing, in collaboration with the Hinge Research Institute, surveyed over 87 firms — representing 1,037 offices and 66,000 employees — about the drivers behind the marketing performance of the fastest-growing firms.
High-growth firms invest two-thirds more in employer branding and recruiting, and they budget more for conferences and events, the data found.
When it comes to marketing budgets, the fastest-growing firms spent 2.1% of their revenue versus low-growth firms, which spent 1%. Some of that money is invested in marketing teams. High-growth firms have a higher ratio of marketing staff to full-time equivalents (1:49) compared to other firms (1:57). However, the average salary of a high-growth firm team member is 27% less than at the slowest-growing firms.
“When it comes to marketing, the accounting industry tends to be risk averse and invests less than most other professional services industries,” Liz Harr, managing partner at Hinge, said in a statement. “But the data shows that those that spend more on marketing are getting superior results.”
High-growth firms also spend 66% more on recruiting talent and developing their employer brands — the reputation, culture, employee experiences and marketing that entices potential hires to choose their firm over another — than low-growth firms.
Finally, the fastest-growing firms spend 21% more of their marketing budget on conferences and other in-person events than their peers, with high-growth firms allocating 30% of their budget versus low-growth firms allocating 25%.
“Today’s high-performing accounting firms are taking a somewhat more balanced approach to marketing,” AAM president Laura Metz said in a statement. “Digital and content marketing budgets are on the rise, but perhaps more than anything, high-growth firms are focused on nurturing relationships in person, whether at industry conferences or their own client appreciation events. These gatherings aren’t just line items, they’re growth strategies where the strongest connections, best leads and boldest brand moments take shape.”
President Donald Trump said his massive tax package is close to being finalized, having notched a deal over the state and local tax deduction, but the White House has yet to win over a faction of conservatives who want more austere spending cuts.
“We’re doing very well. It’s very close,” Trump told reporters Wednesday.
House Speaker Mike Johnson announced Wednesday that he had an agreement with lawmakers from high-tax states to increase the limit on the SALT deduction to $40,000.
“The members of the SALT caucus negotiated yesterday in good faith,” Representative Mike Lawler, a New York Republican, told Bloomberg Television. “We settled on something that we believe in, we support.”
However, several hardline Republicans said House GOP leaders aren’t honoring concessions the White House promised them and are threatening to tank the bill.
But the White House says they never made a deal, instead presenting some of the conservative holdouts with a menu of policy options that the Trump administration can live with, a White House official said.
The White House made clear to conservatives they would have to persuade their moderate colleagues to sign onto those ideas, the official said, a challenging feat given Republicans’ narrow and fractious House majority.
Trump and Johnson plan to meet with some of the ultraconservative lawmakers at the White House at 3 p.m., a person familiar with the plans said. That meeting will be an opportunity to strike a deal, the Trump official said.
Ultraconservative Representative Andy Harris of Maryland cast the conversations with the White House as a “midnight deal” for deeper cuts in Medicaid and faster elimination of Biden-era clean energy tax breaks.
“I’m sorry, but that’s a pay grade above the speaker,” Harris said.
Harris said the bill doesn’t reflect that agreement and hardliners will block the package if it comes to a vote. Representative Ralph Norman, an ultraconservative from South Carolina, said the bill “doesn’t have the votes. It’s not even close.”
Freedom Caucus members said they aren’t moving the goal posts by asking for more spending cuts than the budget outline they already voted for. They said they want to rearrange the spending cuts to focus on ending “abuse” in Medicaid and immediately ending green energy tax breaks.
House Republicans leaders are also planning to accelerate new Medicaid work requirements to December 2026 from 2029 in a bid to satisfy ultraconservatives, according to a lawmaker familiar with the discussions.
How deeply to cut safety-net programs such as food assistance and Medicaid health coverage for the poor and disabled has been a sticking point in reaching agreement on Trump’s tax bill, as Johnson attempts to navigate a narrow and fractious majority.
Harris and Norman spoke shortly after Johnson announced the SALT agreement on CNN.
Johnson said there is “a chance” the package could come to a vote Wednesday.
But several ultraconservatives cast doubt on that. “There’s a long way to go,” said Representative Chip Roy of Texas, another Republican hardliner.
The speaker can only lose a handful of votes and still pass the bill, which is the centerpiece of Trump’s legislative agenda.
The $40,000 SALT limit would phase out for annual incomes greater than $500,000 for the 10-year length of the bill, Lawler said. The income phaseout threshold would grow 1% a year over a decade, a person familiar with the matter said.
The cap is the same for both individual taxpayers and married couples filing jointly, the person added.
Another person described the income phase-out as gradual, so that taxpayers earning more than $500,000 would not be punished.
Several lawmakers — New York’s Lawler, Nick LaLota, Andrew Garbarino and Elise Stefanik; New Jersey’s Tom Kean, and Young Kim of California — have threatened to reject any tax package that does not raise the SALT cap sufficiently.
The current write-off is capped at $10,000, a limit imposed in Trump’s first-term tax cut bill. Previously, there was no limit on the SALT deduction and the deduction would again be uncapped if Trump’s first-term tax law is allowed to expire at the end of this year.
Johnson’s plan expands upon the $30,000 cap for individuals and couples included in the initial version of the tax bill released last week. That draft called for phasing down the deduction for those earning $400,000 or more. That plan was quickly rejected by several lawmakers from high-tax districts who called the plan insultingly low.
The acceleration of new Medicaid work requirements could become an issue in the midterm elections — which fall just one month earlier — with Democrats eager to criticize Republicans for restricting health benefits for low-income households.
House leaders’ initial version of legislation pushed back the new requirements until after the next presidential election.
The earlier date for the Medicaid work requirement could alienate several Republicans from swing districts concerned about cuts to the healthcare program. It is also likely to provoke a backlash in the Senate.
It will be very difficult for states to implement the work requirements in a year and a half, said Matt Salo, a consultant who advises health care companies and formerly worked for the National Association of Medicaid Directors.