Share this:

For the past decade, I’ve been helping business owners and aspiring entrepreneurs learn the ins and outs of the tax industry, including helping them create their own tax preparation business plan

If you’re not familiar with the process, you may be scratching your head, unsure of where to start. But fear not—I’m here to help. With more than 10 years of experience, I have the skills, insights, and resources to assist you in cultivating a top-notch tax preparation business plan.

In this piece, I’ll discuss business plans in more detail and give you all the tools you’ll need to start creating yours successfully, today!


…And while you’re here, don’t forget to register for my FREE online Masterclass training, ‘Teach Me The Tax Game‘ to learn how to increase your income with a new career in the tax industry, and potentially make $100K in just 120 days!


What Is A Business Plan? 


A good tax preparation business plan gives an overview of your business as it is today, as well as where you see it in the next five years. It delves into your business goals and the strategies you plan to use in order to reach them. A good business plan also covers any market research to support your ideas. 


Why Do You Need A Business Plan?


Point blank, if you want to start a brick and mortar or virtual tax preparation business, you need to have a viable business plan. Not only will it help you raise capital, but it will also allow you to map out your growth strategy—which will only play into your success.

Keep in mind that your company’s business plan should be viewed as a living, breathing document that should be revisited every year as your tax business advances.


Creating A Tax Preparation Business Plan


So, you know having a business plan is important, but what’s next? There are 10 essential elements to consider and include. 

  1. Executive Summary
  2. Company Overview
  3. Tax Industry Analysis
  4. Customer Analysis
  5. Competitive Analysis
  6. Marketing Plan
  7. Operations Plan
  8. Management Team
  9. Financial Plan
  10.  Appendix

If it seems like a lot, that’s because it is. But don’t worry! Here I’m going to explain everything below.


1: Executive Summary


Your business plan’s executive summary is an introduction that outlines the key details of your tax company. It’s generally found at the end, not the beginning of your business plan, because it’s meant to summarize each of the key areas.

The summary should grab the attention of the person(s) reading it. Make sure to explain which type of tax preparation business you are operating and its current status. For instance, is your tax company new, is it a chain, or are you trying to grow an existing tax business? Next, summarize each of the fundamental parts of your plan.


2: Company Overview


This is where you write out, in detail, what kind of tax preparation business you’re running. You’ll also want to give a thorough background of your company.

Be sure to answer the following questions:

  • Why and when did you start your tax preparation company?
  • What goals have you reached? (number of employees, clients, profits, etc.)
  • Define your legal framework: Is your business a Limited Liability Corporation (LLC) or are you operating as a sole proprietorship or S-Corp? 


3: Tax Industry Analysis


In this section, you’ll want to provide an analysis of the tax preparation industry. It can seem kind of silly, but I promise you it serves a few valuable purposes.

For starters, it teaches you about the tax industry, which helps you better understand the overall market for the services you’re providing. Additionally, a good tax industry analysis can boost your marketing plan, especially if it pinpoints current market trends.

Finally, an industry analysis shows the people reading it that you are an authority in your field—something you achieve by simply doing the research and laying it out in your business plan.

The main questions you want to answer in this segment are:

  • What is the market size (in dollars) of the tax preparation industry?
  • Who are the main competitors?
  • Is the tax industry marketing increasing or decreasing?
  • What are the current market trends?
  • Who are the tax industry’s leading suppliers?
  • What is the 5-to-10-year growth forecast of the tax preparation industry?
  • How big is the target market for your business?


4: Customer Analysis


Like the industry analysis, the customer analysis is another important component of your tax preparation business plan. This is where you identify the consumers you currently provide tax services too, as well as the ones you want to service in the future. 

Example customer markets include businesses, individuals, families, and schools. Remember that the market you choose to target will influence what kind of tax business you run.

Start by categorizing your target audience based on two profiles: psychographic and demographic.


Demographic Profile


A demographic profile identifies genders, locations, ages, race, education, occupations, and income levels of the audience you’re trying to reach.


Psychographic Profile


A psychographic profile encompasses the interests, habits, and attitudes of a certain person in a group. It identifies the needs and wants of your target audience. The better you are at recognizing consumers’ needs, the easier it will be to attract and maintain them.


5: Competitive Analysis


This portion of your business plan should examine and discuss the direct and indirect competitors of your tax preparation business, with an emphasis on your direct competition—which in this case would be, other tax preparation companies.

On the other hand, your indirect competitors are alternative services that aren’t directly competing with the tax services you provide. An example of this would be using intuitive software programs like TurboTax or Credit Karma, or an on-sight professional to file their taxes.

For every competitor, give a summary of their tax business or services and determine their strengths and weaknesses. Given that you haven’t worked for them in the past, you may not be able to discover everything about them, but there are a few principal things you should be able to deduce with a little research.

Your competitive analysis should answer the following questions:

  • What kinds of consumers do they service?
  • Why type of tax prep business is it?
  • What are the price-points?
  • What do they do well?
  • What do they need to improve?

When you think about the answers—specifically to the last two questions, try to imagine it from the consumers’ point of view. Don’t be scared to ask your competitors’ clients what they do and don’t like about the company. The information they give you will be valuable for identifying your competitive advantages, which happens to be the final part of your competitive analysis. 


Competitive Advantages


Ponder ways you can and will surpass your competition and write it down under the competitive advantages portion of your tax preparation business plan.

Here are some of the questions you should be answering:

  • Do you plan on offering better customer service than your competitors?
  • Are you going to make it easier for clients to use your tax services over others?
  • What services and/or products do you provide that competitors don’t?
  • Are your prices a better value than the competition?


6: Marketing Plan


Generally speaking, a good marketing plan includes four things: product, price, promotion, and place. These are known as the ‘Four Ps of Marketing’ and a reputable business plan should include them all.




In this portion of your business plan, you should echo the kind of tax preparation business that you discussed in your company overview. Next, itemize the exact tax services and products you’ll be selling.




This one is pretty simple. Here you’ll identify the prices you’ll be charging for services and products you will be offering to consumers.




Where is your tax preparation business going to be located? Do you have a brick-and-mortar location or are you operating virtually? Next, identify how the location is ideal for the clients you’re trying to reach.




Last, but certainly not least, is the promotion sub-section of your tax preparation company’s marketing plan. Here you want to archive how you plan to attract and engage potential customers.

There are a number of promotions you can consider for your tax preparation business: 

  • Advertising on billboards, radio stations, in newspapers, magazines, newspapers, and/or the internet.
  • Marketing with flyers or direct mail campaigns.
  • Advertising on social media.
  • Utilizing email marketing with tools from companies like Constant Contact.
  • Investing in search engine optimization (SEO) for your website to target keywords used to increase user engagement and convert more leads to sales.


7: Operations Plan


While the previous areas of your tax preparation business plan talk about your goals, your operations plan discusses how you intend on reaching them. It should have two sub-sections: short-term processes and long-term goals.


Everyday Short-Term Processes


Identify all the daily duties that come with operating your tax preparation business. Include things like answering phone calls, giving consultations, billing customers, and receiving payments.


Long-Term Goals


These should be the goals you want your business to achieve. Maybe you want to reach a million dollars in sales by year five or acquire 100 new clients by the end of the year. Maybe you want to open a second location. Whatever your future business goals are, identify them here.


8: Management Team


When you hire a good team, your business has far more potential to succeed. Establish your key members’ background, with emphasis on their experience and skills conducive to growing a successful tax business. 


9: Financial Plan


Your business plan needs to contain your five-year business financial statement broken down by quarters or months in the first year and every year after that. Your financial statements consist of three things: balance sheets, cash flow statements, and income statements.


Balance Sheets


Balance sheets are all about pinpointing your tax business’s liabilities and assets, and even though they can contain a lot of valuable data, keeping it simple is your best bet for staying organized.


Income Statements


Known as a profit and loss statement or a P&L, income statements show your revenue and then subtract your business costs to determine what you made in profits—or didn’t.


Cash Flow Statements


When deciding how much money you’ll need to start or expand your tax business, your cash flow statement is where you turn. It also ensures that you won’t run out of capital along the way.

When devising your income statements, remember to include as many of the main costs as possible needed to open or grow a tax preparation business. Business taxes, rent, cost of supplies, insurance, and payrolls all need to be present in a good plan.


10: Appendix


Finally, at the end of your business plan is the appendix. Here you enclose all financial calculations along with any and all corroborative documents. For example, your business license or a copy of the lease affiliated with your tax business location.


Ready To Start Your Own Tax Preparation Business?


The importance of creating a tax preparation business plan can’t be overstated, and if you follow the guidelines I’ve so diligently laid out above, you’ll practically be an expert.

So, what are you waiting for? Knowledge is power y’all!

To learn about how you can successfully start and operate your own tax preparation business, visit The Wealth Connect for customized online training courses resources designed specifically to help you to excel in the tax industry space.


…Looking for even MORE ways to generate wealth? Don’t forget to secure your spot for my FREE online training course, ‘Teach Me The Digital Products Game‘ and learn the simplest, most cost-effective ways to grow your business this year!

Discover the
Wealth Building Secrets
That Made Me a Millionaire!

Share this: