When it comes to taxes, most people prefer to leave the preparation and filing to the professionals. This leaves tax industry entrepreneurs with a massive opportunity to bounce on and make some money. Of course, finding tax preparation business success requires a few things.
According to a survey done by the Bureau of Labor Statistics (BLS), a tax preparer, on average, makes more or less $46,860 a year!
And with the right amount of dedication and perseverance, you could make even more than that! Believe it or not, starting your own tax preparation business is a lot easier than you think.
Here are five simple steps to help you get started.
1. Get the Proper Education and Training
While you don’t need to be a certified public accountant (CPA) to start a tax preparation business, it will help if you have a degree in accounting or a related field. Moreover, you should also be well-versed in tax law or have equivalent certifications. Even the basic knowledge of tax preparation can be helpful, and you can always learn more as you go along.
You can also opt for free or paid tax preparation and wealth-building courses to help you navigate the tax industry and get a better one-on-one understanding of everything that’s required to get started.
2. Get the Necessary Licenses and Permits
Depending on your state, you might need a professional license or permit to operate a tax preparation business.
For example, if you reside in Texas, a certified public accountant (CPA) license is required to provide tax preparation services. Or if you’re from Florida or Illinois, you might need to have a permit from the Department of Revenue to provide these services. If you’re unsure, it’s best to check with your state’s licensing board to see if you need any special licenses or permits.
You can also look into getting certified through the National Association of Tax Professionals (NATP). While it’s not required, it can give you an edge over the competition and show potential clients that you’re a credible tax preparer.To become certified, you’ll need to pass an exam and have at least two years of experience preparing taxes.
3. Invest in the Right Technology and Equipment
You’ll need to invest in the right technology and equipment to provide quality tax preparation services, which includes a computer, printer, software, and other office supplies. You might also want to consider investing in a fax machine or scanner so that you can easily send and receive documents from clients.
Moreover, tax preparation software programs can automate the tax preparation process.This will make your job easier and allow you to complete more returns in less time.
4. Join a Professional Organization
Joining a professional organization like the National Association of Tax Professionals is a great way to network with other tax professionals and stay up-to-date on industry news and updates. It can also give you access to valuable resources, such as tax law research materials and discounts on office supplies. Thus, the quicker you are to connect with people in the same industry, the better it will be for you.
5. Market Your Business
Last but not least, you need to market your tax preparation business so potential clients know your services.
There are several ways to market your business, including advertising in local publications, handing out flyers, and networking with other businesses. Set a budget that you are willing to spend on advertising your services and you should be able to reach the target audience effectively.
Bonus Tip: If you don’t have a capable in-house marketing team, try hiring other small to medium-sized marketing agencies. Alternatively, you can also hire freelancers from platforms like Upwork or Fiverr.
Take It Slow
Professionally preparing taxes is a great way to earn a living, but as with any career, tax preparation business success takes time, effort, and dedication. With the proper training, certification, and connections, you can make a lot of money doing something you’re good at!
Remember, you don’t need to be a pro at understanding numbers to get into this business, but it will help if you’re familiar with the tax code and have taken some accounting courses.
If not, that’s okay too! You can always learn and take things one step at a time. The most important thing is to have the passion and drive to succeed in your business.