Starting a tax preparation business in Michigan is relatively easy, which makes it very appealing to entrepreneurs and those looking to make big bucks quickly. And given the minimal barriers to entry, a lot of people seem to be wanting in. A primary concern, however, that many may have is how to set up their practice. This begs the question: To start a tax preparation business, should it be a virtual tax office or a storefront? We’re here to help you answer just that!
Virtual Tax Office Advantages
One of the biggest reasons people choose to start an online tax preparation business is the perk of managing it virtually. In this age, everyone relies on technology, and it is considered the easier way out. That can be especially useful for those who’re just starting, don’t have a lot of cash, and consider it a side income.
Here are a few benefits that may influence your decision:
Less Overhead Expenses
If you choose to work virtually, which can ideally be from the comfort of your own home, you won’t need office space. That will help you cut down on overhead expenses while starting because you do not have to rent a place. You can be up and running with only a fraction of startup costs. That also means that you can save on the additional utility expenses that would’ve come with setting up and maintaining an office space.
Greater List of Potential Clients
Since you’re working virtually, you will not be restricted to the foot traffic around you. That means that anyone can be a potential client, and every encounter is an opportunity to seize that business. So, the client list you’re providing this service for no longer has to be based on wherever you are working from. That makes expanding your client base easier.
Convenience for Clients
Going to the tax office is pretty tedious work that many people find very difficult to take out time for from their busy schedules. By making your tax business your virtual, you’re giving them a convenient digital solution for you and the client. They would no longer have to spend time and effort coming to your office; you can bring the service to them online. That acts as an added advantage for clients. And they may be more willing to have you as their tax preparer when things become so convenient for them.
Easier and Better Hiring Process
You no longer have to compromise on the kind of employees you bring on board because geographical constraints will not restrict you. You can hire employees from across the globe, which allows you to pick and choose the best ones. That means that you can also hire from states with lower living costs.
Given below are the advantages of opting for a storefront. Read them before you make your final decision.
People tend to believe that having a storefront gives an appearance of more credibility. A virtual tax business may not seem very ‘professional’ to some. And a lot of people also have safety concerns when it comes to dealing with someone online with such an important task. Clients trust office-based businesses more.
For the tax preparer, a virtual business may become monotonous, and boundaries between work and private life may blur. While working from an office space, both aspects of your life are separate, and a boundary is certain.
When dealing with people working virtually, a general assumption is made that they have a lack of credit, therefore, their choices. That can have the client doubting their abilities and expertise. A storefront, on the other hand, looks more promising.
Practicing from a storefront ensures that all your time is spent working on your business. However, while working virtually, you may get distracted by other activities around the house, impacting your quality of work. Multitasking does not necessarily ensure that all tasks at hand are done well.
Dedication to Tax Business
Most people opt for a virtual business because they want to manage a few revenue streams at a time. That means that you’d be working on more than one business, which can indicate lesser expertise in the tax business itself. And a lack of dedication towards it, making the tax preparer practicing from a storefront look more promising.
Start a Tax Preparation Business in Michigan
Opinions vary, and there is no guaranteed road to success. So, you can go through the benefits mentioned for each above and choose the way that suits you best. At the end of the day, it will all come down to the effort and financial capital you put in.
If you think the process of starting your own virtual or storefront tax preparation business is a little too complex to go at alone, we can help! We’ve helped hundreds of Michigan entrepreneurs find success in the tax industry, and we can do the same for you. Get in touch with one of our friendly representatives today!
Want more information? Check out our Entrepreneur Blog, where we regularly post articles and free resources to help you profitably break into the tax preparation industry. You can also register for one of Annetta Powell’s wealth-building courses for a one-on-one comprehensive guide to jumpstarting your entrepreneurial future.