tax preparation business plan

Tax Preparation Business Plan Template

Written by Dave Lavinsky

Tax Preparation Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their tax preparation companies.

If you’re unfamiliar with creating a tax preparation business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a tax preparation business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Tax Preparation Business Plan?

A business plan provides a snapshot of your tax preparation business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Tax Prep Business

If you’re looking to start a tax preparation business or grow your existing tax preparation company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your tax preparation business to improve your chances of success. Your tax preparation business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Tax Preparation Businesses

With regards to funding, the main sources of funding for a tax preparation business are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for tax preparation companies.

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How to write a business plan for a tax preparation business.

If you want to start a tax preparation business or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your tax preparation business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of tax preparation business you are running and the status. For example, are you a startup, do you have a tax preparation business that you would like to grow, or are you operating a chain of tax preparation businesses?

Next, provide an overview of each of the subsequent sections of your plan.

• Give a brief overview of the tax preparation industry.
• Discuss the type of tax preparation business you are operating.
• Detail your direct competitors. Give an overview of your target customers.
• Provide a snapshot of your marketing strategy. Identify the key members of your team.
• Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of tax preparation business you are operating.

For example, you might specialize in one of the following types of tax preparation businesses:

• Certified Public Accountant (CPA): This type of tax preparation professional is someone who is licensed to provide an array of accounting services. CPAs can represent their clients in a variety of tax matters such as audits, collections, and appeals with the IRS.
• Tax Attorney: This type of tax preparation professional is licensed to practice law. Tax attorneys can prepare tax returns, and provide clients with tax planning services.
• Enrolled Agent (EA): This type of tax preparation professional is licensed by the IRS and trained in federal taxes. This type of tax preparation professional can represent both business and individual clients.

In addition to explaining the type of tax preparation business you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of clients served, the number of tax issues resolved with positive outcomes, and reaching $X amount in revenue, etc.
• Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the tax preparation industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the tax preparation industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your tax preparation business plan:

• How big is the tax preparation industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential target market for your tax preparation business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your tax preparation business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, schools, families, and corporations.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of tax preparation business you operate. Clearly, individuals would respond to different marketing promotions than corporations, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other tax preparation businesses.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes other types of professionals licensed to perform tax preparation services, do-it-yourself tax software such as TurboTax, or an in-house accountant. You need to mention such competition as well.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

• What types of customers do they serve?
• What type of tax preparation business are they?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you make it easier for clients to acquire your services?
• Will you offer products or services that your competition doesn’t?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a tax preparation business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of tax preparation company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide tax preparation, IRS representation, or appeals services?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the services you offer and their prices.

Place : Place refers to the site of your tax preparation company. Document where your company is situated and mention how the site will impact your success. For example, is your tax preparation business located in a busy retail district, a business district, a standalone office, or purely online? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your tax preparation marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

• Advertise in local papers, radio stations and/or magazines
• Reach out to websites
• Distribute flyers
• Engage in email marketing
• Advertise on social media platforms
• Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your tax preparation business, including answering calls, planning and providing consultations, billing clients and collecting payments, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to acquire your Xth client, or when you hope to reach $X in revenue. It could also be when you expect to expand your tax preparation business to a new city.  

Management Team

To demonstrate your tax preparation business’ potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing tax preparation businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a tax preparation business or successfully running a small CPA firm.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you charge by the hour and will you offer a discount for repeat clients? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your tax preparation business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a tax preparation business:

• Cost of equipment and office supplies
• Payroll or salaries paid to staff
• Business insurance
• Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your office location lease or a copy of your state license.  

Writing a business plan for your tax preparation business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the tax preparation industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful tax preparation business.

Don’t you wish there was a faster, easier way to finish your Tax Preparation business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to see how a Growthink business plan writer can create your business plan for you.

Other Helpful Business Plan Articles & Templates

• Sample Business Plans

Tax Preparation Business Plan

Tax preparation is a recession-proof business. No matter what happens to the economy, this business never goes off-trend. So starting a tax preparation business is an excellent choice.

Starting a business from scratch and standing up against big industry giants may feel overwhelming, but a detailed business plan can help you succeed.

Need help writing a business plan for your tax preparation business? You’re at the right place. Our tax preparation business plan template will help you get started.

Free Business Plan Template

Download our Free Tax Preparation Business Plan Template now and pave the way to success. Let’s turn your vision into an actionable strategy!

• Fill in the blanks – Outline
• Financial Tables

How to Write a Tax Preparation Business Plan?

Writing a tax preparation business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the entire business plan is ready and summarizes each section of your plan.

Here are a few key components to include in your executive summary:

• Introduce your business: Start your executive summary by briefly introducing your business to your readers.
• This section may include the name of your tax preparation business, its location, when it was founded, the type of tax preparation business (E.g., franchise tax preparation services, enrolled agent firms, tax law firms.), etc.
• Market opportunity: Summarize your market research, including market size, growth potential, and marketing trends. Highlight the opportunities in the market and how your business will fit in to fill the gap.
• Tax preparation services: Highlight the tax preparation services you offer your clients. The USPs and differentiators you offer are always a plus.
• For instance, your services may include tax preparation, accounting, tax resolution and representation, tax planning, and tax consulting.
• Marketing & sales strategies: Outline your sales and marketing strategies—what marketing platforms you use, how you plan on acquiring customers, etc.
• Financial highlights: Briefly summarize your financial projections for the initial years of business operations. Include any capital or investment requirements, associated startup costs, projected revenues, and profit forecasts.
• Call to action: Summarize your executive summary section with a clear CTA, for example, inviting angel investors to discuss the potential business investment.

Ensure your executive summary is clear, concise, easy to understand, and jargon-free.

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2. Business Overview

The business overview section of your business plan offers detailed information about your company. The details you add will depend on how important they are to your business. Yet, business name, location, business history, and future goals are some of the foundational elements you must consider adding to this section:

• Business description: Describe your business in this section by providing all the basic information:
• Franchise tax preparation services
• Independent tax preparation services
• Online tax preparation services
• Enrolled Agent (EA) firms
• Tax law firms
• Certified Public Accountant (CPA) firms
• Describe the legal structure of your tax preparation company, whether it is a sole proprietorship, LLC, partnership, or others.
• Explain where your business is located and why you selected the place.
• Owners: List the founders or owners of your tax preparation business. Describe what shares they own and their responsibilities for efficiently managing the business.
• Mission statement: Summarize your business’ objective, core principles, and values in your mission statement. This statement needs to be memorable, clear, and brief.
• Business history: If you’re an established tax preparation service provider, briefly describe your business history, like—when it was founded, how it evolved over time, etc.
• Additionally, If you have received any awards or recognition for excellent work, describe them.
• Future goal: It’s crucial to convey your aspirations and vision. Mention your short-term and long-term goals; they can be specific targets for revenue, market share, or expanding your services.

This section should provide a thorough understanding of your business, its history, and its future plans. Keep this section engaging, precise, and to the point.

3. Market Analysis

The market analysis section of your business plan should offer a thorough understanding of the industry with the target market, competitors, and growth opportunities. You should include the following components in this section.

• Target market: Start this section by describing your target market. Define your ideal customer and explain what types of services they prefer. Creating a buyer persona will help you easily define your target market to your readers.
• For example, if you are an independent tax preparation service provider, you might target busy individuals, self-employed professionals, retirees, new immigrants, and people with low and moderate incomes.
• Market size and growth potential: Describe your market size and growth potential and whether you will target a niche or a much broader market.
• Competitive analysis: Identify and analyze your direct and indirect competitors. Identify their strengths and weaknesses, and describe what differentiates your tax preparation services from them. Point out how you have a competitive edge in the market.
• Market trends: Analyse emerging trends in the industry, such as technology disruptions, changes in customer behavior or preferences, etc. Explain how your business will cope with all the trends.
• For instance, the COVID-19 pandemic has accelerated the trend toward remote and hybrid work in the tax preparation industry, so you may need to explain how you plan to handle your remote team.
• Regulatory environment: List regulations and licensing requirements that may affect your tax preparation company, such as business registration, Preparer Tax Identification Number (PTIN), state-specific requirements, tax preparer bond, insurance requirements, etc.

Here are a few tips for writing the market analysis section of your tax consultant business plan:

• Conduct market research, industry reports, and surveys to gather data.
• Provide specific and detailed information whenever possible.
• Illustrate your points with charts and graphs.
• Write your business plan keeping your target audience in mind.

4. Products And Services

The product and services section should describe the specific services and products that will be offered to customers. To write this section should include the following:

• Preparation of federal, state, and local tax returns
• Review of tax documents
• Electronic filing
• Tax planning
• Audit assistance
• Tax resolution services
• Describe each service: Provide a detailed description of each service you provide, including the process involved, the time required, etc.
• Tax resolution processes, for instance, include consultation, investigation, strategy development, negotiation, resolution, and ongoing compliance.
• Quality measures: This section should explain how you maintain quality standards and consistently provide accurate, reliable, and timely services.
• This may include,
• Regular training and education for staff
• Thorough review and quality control processes to ensure accuracy
• Compliance with all relevant laws and regulations governing tax preparation services, etc.
• Additional services: Mention if your tax preparation company offers any additional services. You may include services like IRS audit support, back taxes, delinquent filing assistance, and tax planning and consulting.

In short, this section of your tax preparation plan must be informative, precise, and client-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:

• Unique selling proposition (USP): Define your business’s USPs depending on the market you serve, your expertise in the market, and the unique services you provide. Identifying USPs will help you plan your marketing strategies.
• For example, personal attention, year-round services, niche specialization, and commitment to excellence could be some of the great USPs for a professional tax preparation company.
• Pricing strategy: Describe your pricing strategy—how you plan to price your tax preparation services and stay competitive in the local market. You can mention any discounts you plan on offering to attract new customers to your tax preparation service.
• Marketing strategies: Discuss your marketing strategies to market your services. You may include some of these marketing strategies in your business plan—social media marketing, networking, Google ads, brochures, email marketing, content marketing, and print marketing.
• Sales strategies: Outline the strategies you’ll implement to maximize your sales. Your sales strategies may include direct sales calls, partnering with local notary businesses, offering referral discounts, etc.
• Customer retention: Describe your customer retention strategies and how you plan to execute them. Your customer retention strategies may include introducing loyalty programs, proactive communication, personalized customer services, and offering referral discounts.

Overall, this section of your tax preparation business plan should focus on customer acquisition and retention.

Have a specific, realistic, and data-driven approach while planning sales and marketing strategies for your tax preparation business, and be prepared to adapt or make strategic changes in your strategies based on feedback and results.

6. Operations Plan

The operations plan section of your business plan should outline the processes and procedures involved in your business operations, such as staffing requirements and operational processes. Here are a few components to add to your operations plan:

• ESoftware & Technology: Include the list of software and technology required for tax preparation, such as tax preparation software, client management software, financial management software, document management software, and regulatory compliance software.
• Explain how these software and technologies help you maintain quality standards and improve the efficiency of your business operations.

Adding these components to your operations plan will help you lay out your business operations, which will eventually help you manage your business effectively.

7. Management Team

The management team section provides an overview of your tax preparation business’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.

• Founder/CEO: Mention the founders and CEO of your tax preparation company, and describe their roles and responsibilities in successfully running the business.
• Key managers: Introduce your management and key members of your team, and explain their roles and responsibilities.
• It should include key executives, senior management, and other department managers (e.g., Tax manager, Accounting manager.) involved in the business operations, including their education, professional background, and any relevant experience in the taxation industry.
• Organizational structure: Explain the organizational structure of your management team. Include the reporting line and decision-making hierarchy.
• Compensation plan: Describe your compensation plan for the management and staff. Include their salaries, incentives, and other benefits.
• Advisors/consultants: Mentioning advisors or consultants in your business plans adds credibility to your business idea.
• So, if you have any advisors or consultants, include them with their names and brief information consisting of roles and years of experience.

This section should describe the key personnel for your tax preparation services, highlighting how you have the perfect team to succeed.

8. Financial Plan

Your financial plan section should provide a summary of your business’s financial projections for the first few years. Here are some key elements to include in your financial plan:

• Profit & loss statement: Describe details such as projected revenue, operational costs, and service costs in your projected profit and loss statement. Make sure to include your business’s expected net profit or loss.
• Cash flow statement: The cash flow for the first few years of your operation should be estimated and described in this section. This may include billing invoices, payment receipts, loan payments, and any other cash flow statements.
• Balance sheet: Create a projected balance sheet documenting your tax preparation business’s assets, liabilities, and equity.
• Break-even point: Determine and mention your business’s break-even point—the point at which your business costs and revenue will be equal.

Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.

9. Appendix

The appendix section of your plan should include any additional information supporting your business plan’s main content, such as market research, legal documentation, financial statements, and other relevant information.

• Add a table of contents for the appendix section to help readers easily find specific information or sections.
• In addition to your financial statements, provide additional financial documents like tax returns, a list of assets within the business, credit history, and more. These statements must be the latest and offer financial projections for at least the first three or five years of business operations.
• Provide data derived from market research, including stats about the taxation industry, user demographics, and industry trends.
• Include any legal documents such as permits, licenses, and contracts.
• Include any additional documentation related to your business plan, such as product brochures, marketing materials, operational procedures, etc.

Use clear headings and labels for each section of the appendix so that readers can easily find the necessary information.

Remember, the appendix section of your tax preparation company business plan should only include relevant and important information supporting your plan’s main content.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

This sample tax preparation business plan will provide an idea for writing a successful tax preparation plan, including all the essential components of your business.

After this, if you still need clarification about writing an investment-ready business plan to impress your audience, download our tax preparation business plan pdf .

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Frequently asked questions, why do you need a tax preparation business plan.

A business plan is an essential tool for anyone looking to start or run a successful tax preparation business. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your business.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your tax preparation company.

How to get funding for your tax preparation business?

There are several ways to get funding for your tax preparation business, but self-funding is one of the most efficient and speedy funding options. Other options for funding are:

Small Business Administration (SBA) loan

Crowdfunding, angel investors.

Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.

Where to find business plan writers for your tax preparation business?

There are many business plan writers available, but no one knows your business and ideas better than you, so we recommend you write your tax preparation business plan and outline your vision as you have in your mind.

What is the easiest way to write your tax preparation business plan?

A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any tax preparation business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software.

About the Author

Vinay Kevadiya

Vinay Kevadiya is the founder and CEO of Upmetrics, the #1 business planning software. His ultimate goal with Upmetrics is to revolutionize how entrepreneurs create, manage, and execute their business plans. He enjoys sharing his insights on business planning and other relevant topics through his articles and blog posts. Read more

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Tax Business Plan Template: Everything You Need to Know

Its a strategy for all aspects of your business. It is a necessity for those looking to start a tax preparation or tax consulting business. 3 min read updated on September 19, 2022

A tax business plan template is a strategy for all aspects of your business. It is a necessity for those looking to start a tax preparation or tax consulting business. A tax preparation business assists individuals and small businesses to prepare and file their taxes correctly and accurately. There are several advantages to choosing a tax preparation business:

• There is little initial investment compared to most other businesses. A tax preparation business can even be started with $500 or less.
• Tax preparation is a flexible business that can be done on a part-time basis and allows for the flexibility to work around family and other obligations. This is a great business venture for stay-at-home parents.
• Tax preparation and consultation services are in demand by small businesses that don't have a full-time accountant. These businesses are able to pay for your expertise only when they need it the most.
• As a tax consultant, earnings can be $100-$200 per month, depending on your expertise.

The first step in determining if a tax business is the right choice for you is to complete research to determine the feasibility. Research is a way to learn important things about the business that will be helpful in your success. This will help you determine if this is the right business for you, and what type of business you should create.

This information gathering will assist you in preparing a tax business plan template. A tax preparation business service plan can include several different parts consisting of a business overview, strategy, marketing, accounting, services, and all aspects of the business. Before you start your business, make sure you consider how to form a solid business plan.

Sample Tax Preparation Service Business Plan

Business overview/products and services/mission statement.

• The company is a financial consulting firm specializing in tax preparation of all types- income tax compilation and returns, tax preparation, financial services, and standard, basic and full-service income tax preparation.
• The employees will be professionals in the financial consulting services industry whose ethics and values align with those of the company.
• The company and employees will be held accountable to meet their clients' needs and will create a working environment focused on sustainable living and community involvement.
• The brand goal is to become the top tax preparation service in the city and among the top tax preparation businesses in the United States within 20 years.
• The tax consulting firm will offer many services within the scope of tax preparation services, tax consulting, and tax-related financial products. The primary clients will be individuals, start of corporations, and established corporations looking to outsource tax preparation.

SWOT Analysis/ Market Analysis/Accounting Plan

• Strength- Our strength lies in our employees who are professional, well-trained, and do what it takes to ensure that our clients get a great value.
• Weakness- As a new company, it will take time to gain respect and acceptance in the community. We also do not yet have the cash flow for expensive marketing efforts.
• Opportunities- There are many opportunities for a tax preparation services company in the community. Individuals and companies both large and small need to use tax preparation services to ensure they are reporting accurately and to save them money.
• Threats- Other similar financial services firms in the area will cause a threat, as well as the existence of certain government policies regarding taxes. Neither of these threats can be reduced or eliminated.
• Financial services and tax preparation is a large industry with the potential to serve many individuals and businesses in need of these services.
• Many small businesses and mom and pop shops don't have the financial capacity to hire a full-time accountant but find it cost effective and less stressful to use tax preparation services and financial consulting services to ensure that everything is handled correctly.
• The target market is anyone who needs tax preparation services and is not restricted to any particular demographic groups. This also includes businesses of any size.
• Competitive advantage- the competitive advantage depends on the location of the business and if it is possible to create a unique angle in which to market your business in that locale, such as offering related services

It is possible to start a successful tax preparation business in just a few days with appropriate research and resources. Training is important, and a degree in an accounting or financial field will put you at an advantage. Make sure to complete state requirements, such as registering your new business.

For more information on tax business plan templates or legal requirements, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

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Tax Preparation Business Plan Template

Written by Dave Lavinsky

Tax Preparation Business Plan

You’ve come to the right place to create your Tax Preparation business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Tax Preparation businesses.

Below is a template to help you create each section of your Tax Preparation business plan.

Executive Summary

Business overview.

Denver Tax Services, Inc. is a new tax preparation company located in downtown Denver, Colorado. We help businesses and residents prepare their taxes and are trained to provide guidance and help for a variety of tax situations. We offer the best customer service in the industry and have a guarantee of accuracy or your money back. Clients who work with us will feel supported during every step of the tax prep and filing process.

Denver Tax Services, Inc. is run by Robert Schwartz. Robert is a certified tax professional and has decades of tax preparation experience under his belt. He has worked for several other firms (including H&R Block) and has provided his services to thousands of clients. His experience and professionalism has gained him a loyal clientbase. The combination of Robert’s expertise, experience, and clientbase will ensure that Denver Tax Services, Inc. is a success.

Product Offering

Denver Tax Services, Inc. provides guidance and support through every step of the tax preparation process. We help individuals and businesses get the maximum refund possible and file their taxes on their behalf. In addition to our tax preparation services, we also provide tax planning, business consulting, estate and trust tax preparation, audit support, and IRS representation services.

Customer Focus

Denver Tax Services, Inc. will help individuals and businesses located within 20 miles of the Denver area. We expect that most of the businesses that utilize our services will be small businesses that have less than 1,000 employees and earn less than $10 million in revenue per year. Most individuals who seek out our services will be middle class or affluent in order to have the disposable income to pay for our services.

Management Team

Denver Tax Services, Inc.’s most valuable asset is the expertise and experience of its founder, Robert Schwartz. Robert has been a certified tax professional for the past 20 years. Throughout his career, he has developed a loyal client base, with many clients having stated that they will switch to Denver Tax Services, Inc. once the company is established and running. Robert’s combination of skills, tax knowledge, and loyal following will ensure that Denver Tax Services, Inc. is a successful firm.

Success Factors

Denver Tax Services, Inc. will be able to achieve success by offering the following competitive advantages:

• Robert Schwartz already has a clientbase from his twenty years of experience working with other tax firms. This clientbase will help the company grow with their repeat business and by referring their friends and loved ones to our services.
• The company will emphasize providing client-focused service so that our clients feel valued.
• The company will provide our tax preparation services at a more affordable rate than the competition.

Financial Highlights

Denver Tax Services, Inc. is currently seeking $400,000 to launch. The funding will be dedicated to the office build out, purchase of initial equipment, working capital, marketing costs, and startup overhead expenses. The breakout of the funding is below:

• Office design/build: $100,000
• Office equipment, supplies, and materials: $50,000
• Three months of overhead expenses (payroll, rent, utilities): $150,000
• Marketing costs: $50,000
• Working capital: $50,000

The following graph below outlines the pro forma financial projections for Denver Tax Services, Inc.

Company Overview

Who is denver tax services, inc..

Denver Tax Services, Inc. helps the businesses and residents of Denver, Colorado with tax preparation and filing. We thoroughly analyze our clients’ tax situations to minimize their taxes and get them the biggest refund possible. We offer a guarantee of accuracy and will refund the fee for our services if our clients are not satisfied.

  In addition to helping our clients with tax preparation and filing, we also provide a suite of other tax services, including tax planning, audit support, and IRS representation. We don’t want to just help our clients out during tax time. We want to support our clients throughout the year so they don’t get any surprises come April 15th.

Denver Tax Services, Inc. is run by Robert Schwartz. Robert has decades of tax prep experience and has gained a loyal clientbase from providing his services through competing firms. After working for several tax prep firms around town, he surveyed his clientbase to see if they would be willing to switch to his new company once launched. Most of his clients responded positively, which motivated Robert to finally launch his business.

Denver Tax Services, Inc.’s History

Upon surveying his clientbase and finding a potential office, Robert Schwartz incorporated Denver Tax Services, Inc. as an S-Corporation in July 2023.

The business is currently being run out of Robert’s home office, but once the lease on Denver Tax Services, Inc.’s office location is finalized, all operations will be run from there.

Since incorporation, Denver Tax Services, Inc. has achieved the following milestones:

• Found an office space and signed Letter of Intent to lease it
• Developed the company’s name, logo, and website
• Hired an interior designer for the decor and furniture layout
• Determined equipment and fixture requirements
• Began recruiting key employees

Denver Tax Services, Inc.’s Services

Denver Tax Services, Inc.’s mission is to maximize the tax refunds of all of our clients. To do this, we help our clients through every step of the tax return process and analyze every situation to make sure each client is getting as many deductions as possible. We help our clients minimize their taxes as much as possible during tax time and provide guidance on how to minimize taxes for the following year.

In addition to tax preparation and filing, we also provide the following services:

• Tax planning
• Business consulting
• Estate and trust tax preparation
• Audit support
• IRS representation

Industry Analysis

Taxes are one of the few certainties in life. However, tax time can be one of the most confusing and stressful times of the year for Americans. As such, many Americans seek out tax preparation software or tax professionals to help them with their tax returns every year. Due to tax law becoming increasingly complicated, the tax preparation industry has become an essential industry for the American economy. As such, the industry is expected to thrive for the foreseeable future.

The tax preparation industry helps citizens and businesses make sense of their tax returns to minimize their taxes and maximize their deductions. These professionals go through every applicable tax form and ask about every possible situation to ensure that customers are getting the biggest refund possible. In addition to tax preparation and filing, these companies also provide a full suite of other tax services, such as planning, consultation, and audit support.

According to IBIS World, the tax preparation industry has been growing steadily at a CAGR of 4.3% for the past several years. The demand for these services only continues to grow as tax law becomes more complicated. Therefore, this growth is expected to continue, meaning that Denver Tax Services, Inc. can expect to be successful in the following years.

Customer Analysis

Demographic profile of target market.

Customer Segmentation

Denver Tax Services, Inc. will primarily target the following customer profiles:

• Small and medium-sized businesses
• Middle class residents and families
• Affluent residents and families

Competitive Analysis

Direct and indirect competitors.

Denver Tax Services, Inc. will face competition from other companies with similar business profiles. A description of each competitor company is below.

H&R Block

H&R Block has been a king in the tax prep industry for several decades. With thousands of locations around the country and thousands of professionals available online, customers of H&R Block can get the tax prep and guidance they need with ease. H&R Block offers software and online tax prep services but also has in person services for those who would rather work with a professional. H&R Block has several offices in the Denver area, so we expect them to be a major competitor.

TurboTax is the most popular tax preparation service in the market. TurboTax provides easy- to-use software so the average American can file their taxes with ease. For those that have more complicated tax situations, TurboTax also offers consultations with tax professionals for an additional fee. Whether customers are doing their taxes on their own or with a professional, TurboTax provides all the support they need to make tax filing a smooth process.

Though TurboTax will continue to be popular, the company’s reputation has tarnished in recent years. The company has been sued several times for misleading their customers and lying about their pricing. These practices have made TurboTax untrustworthy. As such, many former customers of TurboTax will be eager to get the help of a local and reputable tax professional such as those that work for Denver Tax Services, Inc.

Jackson Hewitt

Jackson Hewitt is another major competitor that has prepared and filed millions of tax returns during their 40 year tenure. Like H&R Block, they offer both online and in person tax services to create the most convenient experience possible for their clients. They are well regarded for their refund guarantee as well as their professionalism and customer service. As such, they will be another major competitor for Denver Tax Services, Inc.

Competitive Advantage

Denver Tax Services, Inc. will be able to offer the following advantages over the competition:

• Client-oriented service : Denver Tax Services, Inc. will put a focus on customer service and maintaining long-term relationships. We aim to be the best tax preparation firm in the area by catering to our customer’s needs and developing a strong connection with them.
• Management : Robert has been extremely successful working in the tax preparation sector and will be able to use his previous experience to help his clients better than the competition.
• Competitive pricing : Denver Tax Services Inc.’s pricing is more affordable than our competitors.
• Relationships : Having lived in the community for 20 years, Robert Schwartz knows many of the local leaders, newspapers and other influencers. As such, it will be relatively easy to build a large clientbase over the next several years.

Marketing Plan

Brand & value proposition.

Denver Tax Services, Inc. will offer a unique value proposition to its clientele:

• Client-focused tax prep services, where the company’s interests are aligned with the customer
• Service built on long-term relationships
• Big-firm expertise in a small-firm environment

Promotions Strategy

The promotions strategy for Denver Tax Services, Inc. is as follows:

Targeted Cold Calls

Denver Tax Services, Inc. will initially invest significant time and energy into contacting potential clients via telephone. In order to improve the effectiveness of this phase of the marketing strategy, a highly-focused call list will be used, targeting individuals in areas and occupations that are most likely to need tax prep services. As this is a very time-consuming process, it will primarily be used during the startup phase to build an initial client base.

Denver Tax Services, Inc. understands that the best promotion comes from satisfied customers. The company will encourage its clients to refer other businesses and individuals by providing economic or financial incentives for every new client produced. This strategy will increase in effectiveness after the business has already been established.

Social Media

Denver Tax Services, Inc. will invest heavily in a social media advertising campaign. The company will create social media accounts and invest in ads on all social media platforms. It will use targeted marketing to appeal to the target demographics.

Website/SEO

Denver Tax Services, Inc. will invest heavily in developing a professional website that displays all of the company’s services. It will also invest heavily in SEO so that the firm’s website will appear at the top of search engine results.

Denver Tax Services, Inc.’s fees will be moderate and competitive so clients feel they are receiving great value when utilizing our tax prep services.

Operations Plan

The following will be the operations plan for Denver Tax Services, Inc. Operation Functions:

• Robert Schwartz will be the Owner of Denver Tax Services, Inc.. In addition to providing tax prep services, he will also manage the general operations of the business.
• Robert Schwartz is joined by a full-time administrative assistant, Rebecca Hackett, who will take charge of the administrative tasks for the company. She will also be available to answer client questions and will be the primary employee in charge of client communications.
• As the company builds its client base, Robert will hire more tax professionals to provide the company’s services, attract more clients, and grow our business further.

Milestones:

Denver Tax Services, Inc. will have the following milestones completed in the next six months.

• 9/2023 Finalize lease agreement
• 10/2023 Design and build out Denver Tax Services, Inc.
• 11/2023 Hire and train initial staff
• 12/2023 Kickoff of promotional campaign
• 1/2024 Launch Denver Tax Services, Inc.
• 2/2024 Reach break-even

Denver Tax Services, Inc.’s most valuable asset is the expertise and experience of its founder, Robert Schwartz. Robert has been a certified tax professional for the past 20 years and gained his experience and clientbase by working for competing firms. After years of working with large firms (such as H&R Block), Robert decided he wanted to run his own tax prep firm where he can provide quality services in a small firm environment. He surveyed his clientbase and found that many clients would be willing to transition to his business once established. Robert’s combination of skills, tax knowledge, and loyal clientbase will ensure that Denver Tax Services, Inc. is a successful firm.

Though he has never run his own business, Robert Schwartz has worked as a tax professional long enough to gain an in-depth knowledge of the operations (e.g., running day-to-day operations) and the business (e.g., staffing, marketing, etc.) sides of the industry. He also already has a starting client base that he served while working for other tax prep firms. He will hire several other employees who can help him run the aspects of the business that he is unfamiliar with.

Financial Plan

Key revenue & costs.

Denver Tax Services, Inc.’s revenues will primarily come from charging clients for the tax preparation services we provide. We will charge our clients an hourly rate that will vary depending on the type of tax return they are filing. Clients who owe money on their tax return will be charged directly for our services. Clients who are expecting a refund have the option to either pay us directly or let us take the fee from their refund.

The notable cost drivers for the company will include labor expenses, overhead, and marketing expenses.

Funding Requirements and Use of Funds

Key assumptions.

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.

• Number of clients per year:
• Year 4: 100
• Year 5: 140
• Annual Rent: $100,000

Financial Projections

Income statement.

Balance Sheet

Cash Flow Statement

Tax Preparation Business Plan FAQs

What is a tax preparation business plan.

A tax preparation business plan is a plan to start and/or grow your tax preparation business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Tax Preparation business plan using our Tax Preparation Business Plan Template here .

What are the Main Types of Tax Preparation Businesses? 

There are a number of different kinds of tax preparation businesses , some examples include: Certified Public Accountant (CPA), Tax Attorney, and Enrolled Agent (EA).

How Do You Get Funding for Your Tax Preparation Business Plan?

Tax Preparation businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Tax Preparation Business?

Starting a tax preparation business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Tax Preparation Business Plan - The first step in starting a business is to create a detailed tax preparation business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your tax preparation business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your tax preparation business is in compliance with local laws.

3. Register Your Tax Preparation Business - Once you have chosen a legal structure, the next step is to register your tax preparation business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your tax preparation business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary Tax Preparation Equipment & Supplies - In order to start your tax preparation business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your tax preparation business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

How to Start a Tax Preparation Business

As the owner of a tax preparation business, you’ll have the responsibility of cutting through the fog of federal, state, and local tax preparation, filing returns, and often earning tax rebates for individuals and, perhaps, small businesses.

Ready to turn your business idea into a reality? We recommend forming an LLC as it is the most affordable way to protect your personal assets. You can do this yourself or with our trusted partner for a small fee. Northwest ($29 + State Fees) DIY: How to Start an LLC

Start a tax preparation business by following these 10 steps:

• Plan your Tax Preparation Business
• Form your Tax Preparation Business into a Legal Entity
• Register your Tax Preparation Business for Taxes
• Open a Business Bank Account & Credit Card
• Set up Accounting for your Tax Preparation Business
• Get the Necessary Permits & Licenses for your Tax Preparation Business
• Get Tax Preparation Business Insurance
• Define your Tax Preparation Business Brand
• Create your Tax Preparation Business Website
• Set up your Business Phone System

We have put together this simple guide to starting your tax preparation business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas .

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

What will you name your business?

• What are the startup and ongoing costs?
• Who is your target market?

How much can you charge customers?

Luckily we have done a lot of this research for you.

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Tax Preparation Business Name Generator

If you operate a sole proprietorship , you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name , we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability .

It's very important to secure your domain name before someone else does.

Find a Domain Now

Powered by godaddy.com, what are the costs involved in opening a tax preparation business.

You can start your tax prep business relatively modestly, but there are some unavoidable costs to consider:

Office rent—zero to $1,500 or more. This is a business that you can run from your home, but you must consider if that would be a smart move. First check to make sure your neighborhood is zoned for seeing clients (hopefully a lot of them over the course of a few months) from your residence. Also keep in mind that a storefront office in a part of town with good traffic can act as a billboard and encourage walk-in trade. This might be especially important when you start out. As for the cost of office space, that can vary dramatically from region to region and even from one part of town to another. Look for space that has been empty for awhile and a landlord who might be motivated to get some cash flow to the building for a short lease period of perhaps only three or four months rather than watch the space sit idle.

Business cards, logo and signage—$1,000 or less. If you’re operating out of your home, signage might not even be allowed. But anytime you are able to hang a sign, it will serve as a free billboard and encourage impulse walk-ins. Your logo and business cards can be designed inexpensively if you find a talented graphic design student trying to build a portfolio.

Office equipment and automation—$2,000, est. or more. Even if you’re working out of your home, you want your business to look as professional as possible. That means you should have an office desk and a comforable chair for yourself and as many as two for clients. You’ll also need at least one laptop and printer, or a computer for every employee.

Tax preparation software—$400-$500. There are various vendors depending on your needs.

Legal, licensure and insurance—2,000 est. You must first pass a 60-hour tax prep training course that can cost in the $500-$600 range, depending on where it’s taken. There are additional costs from the IRS and for liability insurance. Furthermore, a few states require additional regulatory adherence.  Visit here for an explanation of some of the training costs and requirements .

Employee costs—Vary. Some of the leading competitors pay individual tax preparers as little as $10 an hour. Others pay a commission of perhaps 20 percent of the fees generated. You’ll also be responsible for tax withholdings and your FICA and Medicare contribution for each hire.

What are the ongoing expenses for a tax preparation business?

If you have a temporary storefront, rent and utilities will be among your largest fixed costs. Temporary employees will also cost you either an hourly rate or a percentage of the business they handle. Other costs might include advertising if you’re looking for a sudden uptick in business.

Who is the target market?

Who will your typical clients be? You might mostly see lower-income earners filing to receive their earned income tax credit. Or more complicated cases from the self-employed or smaller businesses. Or the middle class, who aim to take advantage of various tax credits. Making this decision will help you determine where you might open a storefront, how and where you might market your business and what specific skills you must master.

How does a tax preparation business make money?

You’ll charge a fee for your services, based on the complexity and time involvement of the filing.

According to a National Society of Accountants survey  released in 2017, the average fee charged by tax preparers for an individual itemized 1040 return with a Schedule A form and state tax return was $273. For small business clients, the average charge was $457.

How much profit can a tax preparation business make?

Error-free speed is of the essence. With a statistic mentioned earlier of the average itemized individual return generating $273 in fees, one of these per hour is possible. However, especially as you start your business and before you attract a significant client base, you’ll face unprofitable downtime.

How can you make your business more profitable?

Some accountants or CPAs offer tax prep as one of a range of accounting services. This business is also compatible with financial services, real estate brokerages, insurance and other fields where the business owner is comfortable discussing financial issues with clients. Also keep in mind that if your client base significantly consists of private contractors and small business owners, they might have additional tax issues throughout the year.

And finally, consider conducting tax prep training classes as a complementary service. You could conduct such a class through  The Income Tax School .

Want a more guided approach? Access TRUiC's free Small Business Startup Guide - a step-by-step course for turning your business idea into reality. Get started today!

STEP 2: Form a legal entity

One crucial aspect that cannot be overlooked when starting your tax preparation business is the importance of establishing a solid business foundation. While sole proprietorships and partnerships are the most common entity types for small businesses, they're a far less stable and advantageous option than LLCs.

This is because unincorporated business structures (i.e., sole proprietorships and partnerships) expose you as an owner to personal liability for your business's debts and legal actions, while LLCs protect you by keeping your personal assets separate from your business's liabilities.

In practice, this means that if your tax preparation business were to face a lawsuit or incur any debts, your savings, home, and other personal assets could not be used to cover these costs. On top of this, forming your business as an LLC also helps it to appear more legitimate and trustworthy.

More than 84% of our readers opt to collaborate with a professional LLC formation service to kickstart their venture. We've negotiated a tailored discount for our readers, bringing the total down to just $29.

Form Your LLC Now

Note: If you're interested in more information before getting started, we recommend having a look at our state-specific How to Start an LLC guide (DIY) or our in-depth Best LLC Services review (for those opting for a professional service).

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

You can acquire your EIN through the IRS website . If you would like to learn more about EINs, read our article, What is an EIN?

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil .

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history , which can be useful to raise money later on.

Recommended: Apply for an easy approval business credit card from BILL and build your business credit quickly.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a tax preparation business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits .

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses .

Certificate of Occupancy

A tax preparation business can be run out of an office. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO).  A CO confirms that all building codes, zoning laws and government regulations have been met.

• If you plan to lease a location :
• It is generally the landlord’s responsibility to obtain a CO.
• Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a tax preparation business.
• After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
• If you plan to purchase or build a location :
• You will be responsible for obtaining a valid CO from a local government authority.
• Review all building codes and zoning requirements for your business’ location to ensure your tax preparation business will be in compliance and able to obtain a CO.

Services Contract

Tax preparation businesses should require clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example of one such services agreement.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance . This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance . If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

FInd out what types of insurance your Tax Preparation Business needs and how much it will cost you by reading our guide Business Insurance for Tax Preparation Business.

STEP 8: Define your brand

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners , we'll give you helpful tips and advice for creating the best unique logo for your business.

Recommended : Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker .

If you already have a logo, you can also add it to a QR code with our Free QR Code Generator . Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.

How to promote & market a tax preparation business

As mentioned, your storefront might be your most effective marketing tool if opened within sight of your market audience. Also use social media, including LinkedIn and a Facebook group, to spread the word and communicate with your clients. Your marketing efforts might also go as low-tech and “old school” as handing out fliers to passersby and asking to post fliers or business cards in area businesses.

How to keep customers coming back

Excellent customer service—and satisfactory tax returns—will earn you repeat business through the years. These loyal clients are also likely to recommend you to friends, family or business associates.

STEP 9: Create your business website

After defining your brand and creating your logo the next step is to create a website for your business .

While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.

Here are the main reasons why you shouldn’t delay building your website:

• All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
• Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
• Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.

Recommended : Get started today using our recommended website builder or check out our review of the Best Website Builders .

Other popular website builders are: WordPress , WIX , Weebly , Squarespace , and Shopify .

STEP 10: Set up your business phone system

Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.

There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2023 to find the best phone service for your small business.

Recommended Business Phone Service: Phone.com

Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.

Is this Business Right For You?

If you are a well-organized, people-oriented person who’s taken professional courses to learn the tax preparation business and are at ease with automation and digital software, you could thrive at this largely seasonal business. You should be able to handle long and probably stressful hours in a contained season of intense activity from January through mid-April. After that, you’ll have plenty of time to recover!

Want to know if you are cut out to be an entrepreneur?

Take our Entrepreneurship Quiz to find out!

Entrepreneurship Quiz

What happens during a typical day at a tax preparation business?

Think of your business as falling into two periods—tax season and pre-season—with very different areas of responsibility for each. During tax season, you’ll primarily see clients and prepare and file their taxes. Your goal is to do almost nothing but handle your clients since the tax-filing season is bound by the deadline dictates of the Internal Revenue Service and other taxing agencies.

Off-season, your responsibilities are more diverse. Your pre-season day will probably include some or all of the following activities.

• Interviewing and hiring temporary tax-prep employees, if you have a customer base that justifies seasonal help
• Seeking temporary storefront offices if you plan on working from such a public space rather than from your home
• Ordering and mastering your tax preparation software since software glitches or usage confusion during filing season can result in customer fee losses in the hundreds or thousands of dollars
• Conducting marketing and social media strategies to atttract customers

What are some skills and experiences that will help you build a successful tax preparation business?

In the beginning, your sales and marketing skills will be critical. That’s because you have a narrow window of opportunity for attracting business and plenty of name-brand competition (H&R Block, Jackson Hewitt, TurboTax, etc.). You must also have the patience to prepare for your business success by taking the 60-hour tax course you’ll need for certification and applying for efiling licensure from the IRS.

Once you’re in business, you’ll have to be able to work fast, efficiently and accurately to see as many clients and submit as many tax filings as you can over your limited calendar time. You must also be able to make your clients feel at ease regarding such topics as income, debt, taxes and penalties.

What is the growth potential for a tax preparation business?

The U.S. tax code contains 73,000 pages. Eighty-two million individuals file annually and the complexity of the process discourages most people from preparing their own taxes. While politicians from both parties promise simplification of the tax code, the reality is that the process only grows more complex. That means you can always feel confident of a customer base eager for your help.

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For fun informative videos about starting a business visit the TRUiC YouTube Channel or subscribe to view later.

Take the Next Step

Find a business mentor.

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

Learn from other business owners

Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.

Resources to Help Women in Business

There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:

If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.

What are some insider tips for jump starting a tax preparation business?

Start slow. In fact, before going on your own you might consider working for a season for one of the large competitors. This is a good way to sharpen your skills at using the software, confronting a variety of taxation challenges and working productively. You might also keep your day job and take on a few clients on nights or weekends at first. If you meet their needs they’re likely to be back for years to come—and be powerful word-of-mouth recruitment tools.

How and when to build a team

You look forward to the day when you’re so busy you need additional help. Remember, you don’t want to turn any client away because you don’t have time for them or you could lose them to a competitor forever. Before that happens, start to post for help on job boards. But be sure you state the requirement that applicants must have passed the 60-hour training course (or additional training if they’re to take on business tax clients).

Useful Links

Industry opportunities.

• National Association of Tax Professionals
• Jackson Hewitt (franchise opportunity)

Real World Examples

• Ann Arbor CPA

Further Reading

• What you need to start this business
• Tips for starting this business

Have a Question? Leave a Comment!

The Comprehensive Tax Guide for Starting a Tax Preparation Business – Ultimate Tax

Sep 15, 2022

Individual tax preparers who want to start their own tax preparation businesses should read this guide.

You may be passionate about providing your clients with the best possible tax outcome, but starting your own tax business can be intimidating. This guide will walk you through the steps required to start a tax preparation business and will assist you in navigating the process.

Let’s get started.

Table of Contents

Step-by-Step Instructions for Starting a Tax Preparation Business

Aside from registration and licensing, starting a tax preparation business entails a number of steps. The following are the first nine steps to starting a tax preparation business:

Create a Tax Preparation Business Plan.

The most crucial step in starting a tax preparation business. A well-planned strategy will aid in outlining the specifics of the business. It will also assist you in preparing for the unknown. Keep the following in mind when creating a tax preparation business plan:

• Your initial and ongoing costs
• What is your mental image of your ideal customer?
• What will you charge your clients?
• How do you intend to boost the company’s profitability?

Create a Legal Entity for the Company.

After creating a business plan, you must decide on your company’s legal structure. A partnership, sole proprietorship, limited liability company (LLC), or corporation can be formed.

Become a member of the Internal Revenue Service.

Before you begin operations, you must register your tax preparation business for multiple state and federal taxes. To proceed, you must first obtain an EIN (or the Federal Tax Identification Number). This number is available through the IRS website or by mail. Your business will be taxed depending on the legal entity you choose.

Establish a Business Bank Account.

Maintain a separate bank account for your business at all times. This is critical for the security of your assets. A separate bank account also makes tax preparation and accounting easier.

Create an Accounting System for Your Company.

If you want a better understanding of your company’s financial performance, you must track your income and expenses. Having a comprehensive accounting system in place simplifies tax filing every year.

Obtain All Required Licenses and Permits

You must first obtain the necessary licenses and permits, such as a state license, a certificate of occupancy, and a service contract before you can start your tax preparation business. If you do not comply, you may face steep fines and the closure of your business.

Get Commercial Insurance.

In addition to permits and licenses, you should ensure that your business is legal and safe to operate. This is also advantageous for safeguarding your company’s financial health.

Create a Website for Your Tax Preparation Company.

You can create a website for your organization after completing the preceding steps. A website can help your company establish credibility and attract new customers.

Select a Tax Preparation Software Package.

After you’ve addressed the fundamentals, think about ways to improve the efficacy and efficiency of your business operations. In this case, tax preparation software such as Ultimate Tax can be useful. This can help you grow your business and streamline your operations.

Last Thoughts

We’ve now covered every aspect of starting a tax preparation business. This information should assist you in navigating the process of starting a new business. If you have the necessary resources (tax software for tax professionals ), entrepreneurial drive, and spirit, you will be able to launch your tax preparation business quickly.

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Tax Preparation Business Plan Template [Updated 2024]

Tax Preparation Business Plan Template

If you want to start a Tax Preparation business or expand your current Tax business, you need a business plan.

The following Tax Preparation business plan template gives you the key elements to include in a winning Tax Service business plan.

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Below are links to each of the key sections of a successful tax preparation service business plan. Once you create your plan, download it to PDF to show banks and investors.

Tax Preparation Business Plan Home I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan

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How To Create A Tax Preparation Business Plan

by Annetta Powell | Mar 10, 2023 | Entrepreneurship , Tax Business

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. 

• Executive Summary
• Company Overview
• Tax Industry Analysis
• Customer Analysis
• Competitive Analysis
• Marketing Plan
• Operations Plan
• Management Team
• Financial Plan

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!

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How to Start a Tax Preparation Business from Home

By: Author Tony Martins Ajaero

Home » Business ideas » Financial Service Industry » Accounting, Bookkeeping and Tax Preparation

Are you interested in starting a tax preparation business from home? If YES, here is a complete guide to starting an online tax preparation business with NO money and no experience plus a sample tax preparation business plan template.

Firms in this industry provide tax return preparation services to individuals but do not offer accounting, bookkeeping, and billing or payroll process services. Although the offices of CPAs are excluded from this industry, basic knowledge of tax law and filing requirements is required.

Contrary to popular belief, tax preparation businesses are in operation and have year-round clients as businesses must file their taxes on a quarterly basis. If you want to start a tax preparation business, it helps to have a background in accounting, but is not necessary. You’ll have to decide if you will cater to individual taxpayers, businesses or both.

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Steps to Starting a Tax Preparation Business from Home

1. understand the industry.

Tax preparation is BIG business – there were 300,000 people employed at 109,000 firms in 2012 – generating $9 billion in revenue in 2012. The industry grew over 2% from 2010-2015, and is expected to speed up the pace of growth.

Interesting Statistics About the Industry

Revenues of $11 billion are forecast for 2018. Tax preparation is unusual in that it provides a service to assist with a process that legally every American is required to do: submit an income tax return. Because it is required, tax preparation tends to be recession resistant.

The vast majority of tax preparers are small businesses – 37% are run by a single person, while 53% employ less than ten people. There were plenty of tax returns to go around – the IRS estimates that there will be over 250 million filed by 2018.

One of the most notable aspects of the tax preparation industry is how seasonal it is – the industry only comes into being for essentially the four months before April 15, the day on which income tax returns are due for individuals.

Because of this reality, those interested in a tax preparation franchise such as Liberty tax service or Opportunity Tax Service should be those looking for a part-time opportunity. It will not provide year round business, and this can be a unique benefit for those looking for extra work for a couple of months, but a detriment to those looking for more of a full time franchise.

One approach some tax preparation businesses take to avoid the stark seasonality of the business is to diversify into other related fields.

Others, like Siempre Tax+ are focused on specific markets, like the Hispanic population. RALs, or refund anticipation loans, have been a recent controversial issue in the tax preparation business. These loans, which have been around since the 1980s, give a short-term loan to consumers secured by their eventual tax refund.

Generally this is done through the tax preparer, and the bank who issues the loan and hosts the account in which the loan is deposited charges a fee. These are high interest, low risk loans which are geared toward poor people, and there have been several lawsuits brought by government entities charging tax preparer firms with predatory lending practices.

To address this, the IRS in 2011 decided to stop providing tax preparers with the information they needed to issue these loans, at least temporarily ending RALs, and putting some smaller tax preparation firms, which relied on RALs for much of their revenue, out of business.

Despite politicians occasionally clamouring for a flat tax, income taxes remain as complicated as ever. It is very likely there will always be a demand for tax preparers, even as tax prep computer software becomes more users friendly and accessible. The industry, including other accounting services, is expected to grow by 4 percent per year through at least 2018.

2. Conduct Market Research and Feasibility Studies

• Demographics and Psychographics

Households in all socioeconomic groups across the united states use the services of tax preparers. Consequently, industry establishments and revenue are distributed in line with regional population. Many people use the tax preparation firm nearest to them, out of convenience.

When an area is underserved, more firms move into that area to stake a claim in the market. Similarly, firms tend to move locations when competition is too high and profit margins begin to suffer

3. Decide Which Niche to Concentrate On

Many tax preparers started their own firms ready to help local business owners and individual tax payers, but perhaps haven’t thought about how to narrow their approach so that they can develop an area of concentration and position themselves as an expert at something which generates higher fees and higher profit margins.

Some areas of specialization include;

• Mobile tax office
• IRA Problem Resolution
• Bookkeeping
• Expert consultancy on Tax Services
• Forensic/Business Valuation

The Level of Competition in the Industry

The biggest change in recent years for tax preparers has been that familiar harbinger of death for many industries: technological change. PC-based tax preparation software such as Intuit’s (INTU) TurboTax, combined with electronic filing options from the IRS, has begun really hurting traditional preparers – and this trend is accelerating.

Returns filed electronically have grown at a compounded 18% annually over the past 6 years. Last year, over 31 million returns were filed in this manner, 24% of the total.

Starting a Tax Business is an entrepreneurial leap that many self-motivating individuals are finding more and more appealing. With the Tax Code becoming more complex every year, the portion of the population of taxpayers who seek out professionals to assist in their tax preparation and filing is growing steadily, making the industry a competitive one.

4. Know Your Major Competitors in the Industry

There will always be well known brands that are scattered in different business sectors. Ione of these sectors is the tax preparation business. Here are some well-known brands in this trade;

• Jackson Hewitt tax
• Liberty tax service
• Boston tax services
• H&R Block at Home (formerly TaxCut)
• Intuit ProSeries

Economic analysis

The Tax Preparation Services industry experienced a slight downturn during the recession due to falling national employment and a decrease in disposable income. However, the industry rebounded in 2011 as the national unemployment rate fell, and revenue increased as more Americans were required to file tax returns.

Still, the industry landscape has begun to change, with consumer preferences increasingly trending toward operators that provide online filing options.

Although improving economic conditions are expected to support industry revenue growth over the next five years, some operators’ performance will be stunted, as online providers threaten traditional brick-and-mortar establishments.

5. Decide Whether to Buy a Franchise or Start from Scratch

For the sake of this article, starting a Tax preparation business from the scratch is far better than buying a franchise. Here are just some of the reasons why starting your own tax preparation business makes better sense than buying into a tax business franchise. Having your own tax business means:

• avoiding costly start up fees
• avoiding royalty payments
• avoiding issues with financing assistance
• avoiding geographic restrictions
• avoiding issues with franchisor legal recourse should something go wrong
• creative control – you get to do things your way
• No contract requirements–do you know what you’ll be doing years from now?
• No problems with insufficient support from the franchisor
• reasonable costs for supplies—no franchisor mark-ups
• freedom for non-compete provisions should you want out of the franchise
• avoid advertising fees that may not help your franchise
• avoid losing your business due to unreasonable termination of your franchise

6. Know the Possible Threats and Challenges You Will Face

People who start a business do so for many different reasons. They may be looking for freedom, new challenges or financial return. A tax preparation business can fulfill many of those goals as well as provide many new rewards. Here are some challenges to starting a tax preparation business:

• Getting an education in tax preparation.
• Obtaining experience as a tax preparer
• Choosing a tax preparation software
• Registering your tax preparation business with the state.
• Finding office space.

7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)

The legal structure of most businesses is based on the size and scale of the business. Since the tax preparation business is all about the income and property of your clients, the LLC is the best legal entity for your business; be it small, medium or large.

The benefits of creating an LLC typically outweigh any perceived disadvantages and are typically unavailable to sole proprietorships and general partnerships.

Protected assets

LLCs provide limited liability protection to their owners (members), who are typically not personally responsible for the business debts and liabilities of the LLC. Creditors cannot pursue the personal assets (house, savings accounts, etc.) of the owners to pay business debts. LLCs typically do not pay taxes at the business level. Any business income or loss is “passed-through” to owners and reported on their personal income tax returns. Any tax due is paid at the individual level.

Heightened credibility

Forming an LLC may help your new tax preparation business establish credibility with potential customers, employees, vendors and partners because they see you have made a formal commitment to your business.

Limited compliance requirements 

LLCs face fewer state-imposed annual requirements and ongoing formalities than S corporations and C corporations.

Flexible management structure

LLCs are free to establish any organizational structure agreed upon by the company owners. LLCs can be managed by the owners (members) or by managers, unlike corporations which have a board of directors who oversee the major business decisions of the company and officers who manage the day-to-day affairs.

Few restrictions

There are few restrictions on who can be an LLC owner or how many owners an LLC may have (unlike S corporations).

8. Choose a Catchy Business Name

Choosing the right name for your tax preparation business is a daunting task for many new entrepreneurs because there is so much at stake. Your business name should show strength and reliability, a name your customers could trust to safe guard their money.

• Frontline tax service
• Presesion tax network
• Payless taxes
• A-Z tax company
• Tax Rangers Inc.
• Tax pro services
• Firstchoice tax services
• Diamond tax
• Skye tax network
• Access tax Inc.

9. Discuss with an Agent to Know the Best Insurance Policies for You

As a tax preparer, you have to master the complicated tax laws of this country and save your clients the stress of having to do the legwork on their own. Your clients often turn to you when their taxes become too complex to complete on their own or when they’re looking to get the most out of their tax return.

But do you know as much about your insurance plan as you do about taxes? As a tax professional, you might not work in the most hazardous of environments, but business risk still exists. Here are basic Insurances needed for your tax preparation business:

• General Liability Insurance
• Property insurance
• Errors & omissions insurance
• Business owner’s policy
• Workers’ compensation insurance
• Cyber liability insurance
• Umbrella liability insurance
• Commercial auto / hired & non-owned auto insurance

10. Protect your Intellectual Property With Trademark, Copyrights, Patents

Your tax preparation business competitive edge and its future value may depend on the way you protect assets such as trademarks, patents, copyright and industrial designs. By understanding the rules about trademarks, patents and copyright you can protect your firm’s works and innovation and safeguard from potential legal difficulties.

Intellectual property (IP) rights play an important role in monetizing innovation—if you make it easy for competitors to copy ideas, you can ultimately destroy the firm’s success. Have you ever considered how many people have access to your IP during the tax preparation, review and audit process?

In order to protect your ideas in the tax preparation business you need to do the following

• Use a non-disclosure agreement liberally
• Be proactive in protecting your IP
• Invest in universal IP protection, where possible
• Discover your business advantage

11. Get the Necessary Professional Certification

Tax preparers calculate, file and sign income tax returns on behalf of individuals and businesses. They can also represent taxpayers during IRS examinations of tax returns. Having some professional certifications surely improves your reputation in the business and in turn assures your prospective customers of your versatility in the field.

Professional certification for a tax preparer may include

• Accredited tax preparer – ATP
• Accreditation Council for Accountancy and Taxation certification – ACAT
• National Association of Tax Professionals – NATP
• Certified Tax preparer – CTP
• Tax preparer certification – TPC
• California Tax Education council Registered Tax preparers – CTEC

12. Get the Necessary Legal Documents You Need to Operate

Many state and local governments have laws about what sorts of businesses need to be regulated by the government. Check with your local laws to determine if you will be required to get a license for your tax preparation business before you begin.

Listed below are common documents needed for your tax preparation business

• Business license
• Preparer Tax Identification Number (PTIN)

13. Write a Business Plan

A well-thought-out business plan is a valuable tool for a new business or one seeking financing. It can also provide milestones to gauge your success. Indeed, the very process of developing a business plan will help you think through some important issues that you may not have considered yet.

Before getting down to the actual preparation of your business plan, take the time up front to explore and evaluate your business (and personal) goals. Then use this information to build a comprehensive and effective business plan that will help you reach these goals.

A business plan formalizes the analysis of a prospective business by forcing you to put your ideas and the answers to some critical questions in writing. A business plan sets forth the mission or purpose of the business venture, describes the services to be provided, which presents an analysis of the market state, the goals that the business has, and how it intends to achieve those goals and last, but not least, has a formal financial plan.

Your business plan should include your introduction/mission, Products/Services and Markets, financial management, operations, and concluding statement.

14. Prepare a Detailed Cost Analysis

A tax preparation business involves helping people to prepare and file their tax returns professionally. While many people prepare their taxes without professional help, there are still a lot of people who lack the expertise, time and energy to handle their tax filings by themselves. As a tax professional, you also act as a consultant to individuals and business owners and show them how to reduce their tax liability.

Tax preparation business is a very good business that involves low start-up costs and little running expenses however, it is not suitable as a full-time business because you would be idle for better part of the year due to the seasonal nature of the business.

Here is a detailed cost analysis of starting a small scale tax preparation business

• Comprehensive Tax Course with Business Start-up Package – $497
• IRS registration to become a Tax Preparer – $50
• Voluntary IRS Annual Filing Season Program – around $100 or less
• Professional tax preparation software – (lower cost options are available) $500
• Tax preparation Marketing and Tax Office Supplies – $500
• Lease or space rent- $700
• Miscellaneous – $1000

From our detailed analysis, it is envisaged that you will need $3,347 to start a small-scale tax preparation business ( excluding home tax preparation business ). For a medium scale tax preparation business $12,000 and $49,000 for a large scale tax preparation business.

15. Choose a Suitable Location for your Business

As a prospective tax preparer, you probably are familiar with the national chain tax businesses in your area. They are easy to spot. The three big players are H&R, Jackson Hewitt, and Liberty. It is tough to come across a strip mall that does not have one of these guys already in it, but you should ask yourself: why do they choose these locations? You can rest assured they have done their homework.

The reason they choose their locations typically are due to population density, average adjusted gross income (AGI) in that surrounding area, and proximity to their target market. You should use the same factors when considering locations for your tax business.

If you are familiar with the specific area you are considering you probably have a pretty good idea how many people have access to that location, what income level they belong to, and you can do a survey of competitors by driving around. There are specific demographical and socioeconomic reports that provide specific detail relating to these topics. But you should be thinking about all of these factors before signing on lease for your tax service.

16. Hire Employees for your Technical and Manpower Needs

You don’t necessarily need tax preparation software but to save you a lot of time and reduce errors and also make your work look professional to your clients, it is better to purchase tax preparation software. You must however ensure that the software conforms to the generally accepted taxation principles and the rules governing taxation in your state or country.

Your choice of tax software is probably one of the most important decisions you’ll make in starting your new tax preparation business. Everybody has different things they like about various commercial tax packages, and all software has its pros and cons.

Other Equipment You Need for a Tax Preparation Business includes, A computer( Laptop or Desktop),Printer, Photocopier, Scanner, Internet Service, Fax machine, Professional business cards, Tax filing forms, A business website, Social media and E-mail accounts.

The Service Delivery Process of the Business

A tax preparation business only boom in the beginning of the year when people pay their taxes (January-April). After this period, there is really nothing left to do if you are solely into Tax preparation business. The business is suitable for people seeking for part-time jobs that would allow them to spend sufficient time with their family and take vacations during the year.

Tax preparation is the kind of business that’s simple to start but requires specialized knowledge. It’s important to understand complex tax issues, and to know where to find answers quickly when you don’t have them. Being a tax preparer doesn’t require a degree, but it’s helpful to have experience in bookkeeping or accounting as well as a desire to work with numbers and forms.

17. Write a Marketing Plan Packed with ideas & Strategies

When you’re running a tax preparation business, your top concerns include hiring qualified preparers, staying consistent with new tax rules and assuring that you have the latest tax software. But one issue that you should prioritize if you want a successful operation is how to market your tax preparation business with all of the competition that arises at tax time.

Remember what many customers are looking for from a tax preparer when forming your marketing plan—capability, professionalism and assurance that the preparer will produce the best result possible. Some of the steps to be employed include;

• Hire a professional graphic designer to create your marketing materials and a website.
• Create a brand for your tax business to help differentiate it from the other tax preparers nearby. That includes an attractive logo, design and a colour scheme that you use consistently throughout all of your marketing materials as well as your office signs and website.
• Create a short motto for your tax preparation business that assures customers of your professionalism and ability to provide them with the maximum refund or minimum amount due possible. Use the motto in your flyers, ads and other marketing materials also.
• Hire a flyer team of about five to 10 people to distribute information about your company to the people in your community. Provide a separate code on each flyer to represent each flyer person so that you can pay him a commission for each sale he brings in plus a modest hourly rate for the foot work.
• Consider promoting your tax preparation business online through social networking websites, message boards where permitted and classified ads websites, such as Craigslist.
• Offer a special discount for new customers to bring more business to your tax preparation business. For example, you can offer a half-off special. Consider the true value of the offer from a long-term viewpoint instead of focusing on the short-term loss of money. If the new customer likes your preparation services, he’ll come back year after year at the full rate.
• Prepare your tax preparers with customer service training, including sales techniques, tips and proven methods to keep customers happy well before the start of your tax season.

18. Work Out a Reasonable Pricing for your Services & Products

Tax preparers earn the bulk of their annual income during the first quarter of the year, between January 1 and April 30. And like teachers, many tax preparers are able to a significant amount take time off during the summer and fall, sometimes as much as three months.

In other to get the right pricing and make money in this field, you need to choose a good, affordable, and reliable tax software program with which to prepare taxes.  Buying the wrong software and equipment can derail your plans for having a big tax season before you even hop on the train. You need to work hard to complete enough tax returns in a day to be able to set yourself up for success.

19. Develop Iron-clad Competitive Strategies to Help You Win

Before sorting for ways to outshine your competitors, you must first understand who they are and what they lack. Understanding your competitors and where you stand would indeed help you to win them.

Position strengths to weaknesses

Even if your competitor has a better service to render and is willing to do it at a lower price, you can still win. Every competing company has weak points — places where your brand can outperform. Things like domestic customer service or extended guarantees on a service can go a long way if done right.

Your job is to find these points and exploit them in your marketing and presentations. Let your prospective customers know why these selling points are important and why it makes your brand a better choice.

This is about maximizing value and minimizing waste. Value refers to features a customer wants to pay for while waste essentially is everything else. This means you must be in constant contact with your clients and understand why they’re patronizing your firm. Ask them how you can enhance it. Any additional features your firm offers — no matter how attractive — should be dropped if your clients don’t want them.

Go after large clients

Larger clients can often result in more business and increased revenues, which mean more resources for marketing and hiring new employees. But large clients can also be easier to service than smaller companies.

Know your numbers

It is surprising that most entrepreneurs don’t know the critical numbers that can either make or break their business. Here are a few of the basics that every start up should be tracking:

• ACV ( Average Customer Value )-: This refers to how much money the average customer spends with you over a given period of time.
• CPA ( cost per acquisition )-: This is your cost every time you acquire a new client.
• ROI (return on investment) on marketing campaigns
• Break even -: This is the volume of sales you need to cover the cost of making sales.

20. Brainstorm Possible Ways to Retain Clients & Customers

On the surface, many businesses appear the same, offering similar products or services at comparable prices. So, what really drives customers to one business over another? The customer experience plays a big part in that decision. In fact, 55% of American business owners believe that customer service plays an increasingly important role in differentiating one business from another.

So to retain your customers in the tax preparation business, you need to

• Acknowledge customers by name
• Keep it simple
• Create a customer service culture
• Stay connected after the returns

21. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity

Having a brand alone is not enough. To win over customers you need to make sure you shout about your brand and get your name in front of as many eyeballs as possible.

• Create an identifiable brand
• Optimize your website
• Create a social media presence
• Personalization
• Win Competition
• Biddable media

22. Create a Supplier/Distribution Network 

It’s amazing how many people think that tax preparation is all about the numbers, but that’s not all. Tax preparation is actually a people business. So, if you enjoy working with people, you could do very well in the tax business. It’s about building relationships and trust.

Yes, it is extremely important that you have the knowledge to prepare taxes accurately. But the experience that your clients have during the tax preparation process and after is just as important. When you are dealing with a client’s financial information it becomes very personal. Your client trusts you to take good care of him/her and hopes you have their best interests in mind.

Your client is looking for guidance and has come to you because they see you as an expert in the tax industry. You could prepare a client’s tax return perfectly but if you don’t provide personal service, they may not be back. Relationships are paramount

23. Tips for Running a Tax Preparation Business Successfully

As the trusted tax advisor to your tax clients, you are in the position to provide them with the additional financial services they need. By obtaining the required licenses, you can provide financial services and products such as IRAs, retirement plans, insurance, etc. You can choose from several reputable broker-dealers that specialize in helping tax professionals to meet their clients’ financial service’s needs.

You can also provide bookkeeping and payroll services for your small business tax clients to produce additional year-round revenue. Thousands of small businesses are started every day and the trend is accelerating due to the large number of displaced workers turning to self-employment and don’t forget the small stuff Petty cash purchases, magazine subscriptions, educational classes and more. These “small” expenses can add up quickly. Make sure you track all your expenses and check with your tax advisor about what you can and can’t deduct .

Your accountant can ensure you don’t overdo or exaggerate your deductions – something that can raise the possibility of an IRS audit. For example, many small business owners mistakenly assume that they can deduct 100% of meal costs while travelling or client gifts.

They are actually only partly deductible. Likewise, if your expenses are a lot higher this year than last or not considered typical for your industry or business type, the IRS may get inquisitive. Other tips include; separate personal and business, avoid payroll mistakes and keep your records up-to-date.

How to Start a Profitable Tax Business [11 Steps]

By Nick Cotter Updated Feb 02, 2024

Business Steps:

1. perform market analysis., 2. draft a tax business plan., 3. develop a tax brand., 4. formalize your business registration., 5. acquire necessary licenses and permits for tax., 6. open a business bank account and secure funding as needed., 7. set pricing for tax services., 8. acquire tax equipment and supplies., 9. obtain business insurance for tax, if required., 10. begin marketing your tax services., 11. expand your tax business..

Starting a tax business requires a comprehensive understanding of the current market. By performing a thorough market analysis, you can identify your target demographic, assess the competition, and determine the services you'll need to offer to stand out. Here's how to get started:

• Research the local and national tax service demand to understand the size and characteristics of your potential client base.
• Analyze competitor offerings, pricing strategies, and market positioning to gauge how your tax business can differentiate itself.
• Examine industry trends, such as the growing importance of digital tax services and changes in tax legislation, to anticipate future market needs.
• Identify your niche by considering specializing in certain areas like small businesses, freelancers, expatriates, or specific tax issues.
• Use statistical data from government and financial institutions to support your analysis and help forecast potential growth areas within the tax industry.
• Gather feedback from potential clients through surveys or focus groups to understand their expectations and service preferences.

Are Tax businesses profitable?

Yes, tax businesses can be very profitable. Depending on the size and scope of the business, tax businesses can generate significant income from preparing tax returns, offering financial planning services, and providing other tax-related services.

Starting a tax business requires a well-structured plan that outlines your business objectives and the strategies you'll employ to achieve them. A comprehensive business plan will serve as a blueprint for your tax business, guiding you through the initial stages and helping you manage your business effectively. Here are some key components to include in your tax business plan:

• Executive Summary: Summarize your business goals, target market, and competitive advantages.
• Business Description: Define the scope of your tax services, the legal structure of your business, and your unique selling proposition.
• Market Analysis: Research your target market, including potential clients and competitors, to identify market needs and trends.
• Marketing and Sales Strategy: Develop a plan for attracting and retaining clients, including pricing, promotions, and sales tactics.
• Operations Plan: Outline your business location, technology needs, and any staff or partnerships required to operate the business.
• Financial Projections: Provide detailed financial forecasts including start-up costs, revenue projections, and a break-even analysis.
• Risk Assessment: Identify potential risks and challenges your business may face and how you plan to mitigate them.

How does a Tax business make money?

Tax businesses make money by charging a fee for their services. This fee is usually a percentage of the total tax liability of the client or a flat fee for filing taxes. They may also offer additional services such as financial planning and tax planning advice for a separate fee.

Developing a tax brand is a crucial step in differentiating your business in the competitive tax preparation market. Your brand represents your promise to your clients, embodying the quality, trustworthiness, and expertise they can expect from your services. Consider the following guidelines to create a strong and memorable tax brand:

• Identify your unique selling proposition (USP) - Determine what makes your tax services stand out. It could be your expertise in a niche market, superior customer service, or innovative use of technology.
• Choose a brand name and logo - Select a name that is easy to remember, reflects your USP, and resonates with your target audience. Design a professional logo that conveys your brand's values and is versatile across various mediums.
• Develop a brand message - Craft a clear and compelling message that communicates the benefits of choosing your services. This message should be consistent in all your marketing materials and customer interactions.
• Consistency is key - Ensure your brand's visual elements and messaging are consistent across your website, business cards, social media profiles, and promotional materials to build recognition and trust.

How to come up with a name for your Tax business?

When coming up with a name for your Tax business, it is important to choose something that is both catchy and professional. Consider choosing a name that is memorable and has some connection to the services your business provides. Brainstorm ideas with friends and colleagues and research any existing names to make sure your choice is unique. Once you have chosen a name, register it with your local government to ensure that your business name is officially yours.

Once you have a solid plan in place for your tax business, the next critical step is to formalize your business registration. This is a legal requirement that will establish your business as a legitimate entity in the eyes of the government and financial institutions. The following are key points to consider during this stage:

• Choose a business structure (e.g., sole proprietorship, partnership, LLC, corporation) that aligns with your goals and offers the liability protection and tax advantages you need.
• Register your business name with the appropriate state authorities, ensuring it's unique and not already in use.
• Obtain an Employer Identification Number (EIN) from the IRS for tax purposes, which is necessary even if you don't have employees.
• Apply for any necessary business licenses or permits specific to tax preparation services in your state or locality.
• Register for state and local taxes, including sales tax if applicable, and understand your obligations for collecting and remitting them.
• Consider professional liability insurance to protect your business from potential claims arising from your services.

Resources to help get you started:

Explore critical resources designed for income tax entrepreneurs to gain knowledge on market trends, optimize operations, and cultivate strategies for business expansion:

• Internal Revenue Service (IRS) - Offers comprehensive guides and tax code updates crucial for compliance and planning. Visit site .
• National Association of Tax Professionals (NATP) - Provides industry reports, professional training, and networking opportunities. Learn more .
• Tax Foundation - Shares in-depth research and analysis on tax policies affecting the sector. Explore here .
• Accounting Today - Delivers news, insight, and technology trends for tax professionals through newsletters and publications. Subscribe .
• Bloomberg Tax & Accounting - Offers market trends, analysis, and strategic advice through professional publications. Discover more .

Starting a tax business involves understanding and complying with various legal requirements. One crucial step is obtaining the necessary licenses and permits to operate legally and handle taxes professionally. Below are key points to guide you through this process:

• Check with your state's Board of Accountancy for any CPA or tax preparer certification requirements.
• Register for a Preparer Tax Identification Number (PTIN) through the IRS to legally prepare federal tax returns.
• Apply for an Electronic Filing Identification Number (EFIN) from the IRS if you plan to file tax returns electronically.
• Understand your state's tax preparer requirements, which may include additional exams, educational courses, or specific tax preparer permits.
• Investigate local business licenses, which can vary by municipality or county, to ensure compliance with local business operating standards.
• Consider obtaining professional liability insurance to protect your business from potential errors and omissions claims related to tax preparation.
• Stay updated on any changes in tax laws and licensing regulations, as these can affect the validity of your permits and your ability to practice.

What licenses and permits are needed to run a tax business?

Depending on the jurisdiction, tax business owners may need to obtain a professional license or tax preparer license, and/or obtain specialized certifications such as an Enrolled Agent. A business license and other specific state registrations may also be necessary. Additionally, businesses must comply with any local regulations concerning the operation of a tax business in their area.

Starting a tax business requires careful financial planning and management. A dedicated business bank account is crucial for keeping your company's finances separate from personal funds, and securing the right funding can help cover startup costs and maintain cash flow. Follow these steps to get your financial foundation in place.

• Research banks and credit unions to find the best business banking options, focusing on fees, services, and convenience.
• Gather required documents such as your business license, Employer Identification Number (EIN), and organizational documents to open the account.
• Choose between different types of business accounts, like checking, savings, or merchant services accounts, based on your needs.
• Explore funding sources such as small business loans, lines of credit, or business credit cards, if your initial capital is insufficient.
• Consider reaching out to potential investors or applying for grants specifically aimed at new businesses or tax services.
• Maintain a strong business plan to present to lenders or investors, demonstrating the viability and financial projections of your tax business.
• Regularly review your business budget and financial situation, and adjust your funding strategy as your business grows and evolves.

Setting the right prices for your tax services is crucial to ensure your business is competitive while also ensuring profitability. Consider your costs, the complexity of the work, and the value you provide to your clients. Here are some key points to guide you in setting your pricing:

• Cost-Based Pricing : Calculate your costs, including time, software, overhead, and add a markup for profit.
• Value-Based Pricing : Charge based on the value and benefit the service provides to the client, which can allow for higher prices for complex cases.
• Competitive Analysis : Research your competitors' pricing to ensure your rates are in line with the market.
• Flexible Pricing Structures : Offer different pricing tiers, such as flat fees for simple returns and hourly rates for more complex filings.
• Transparent Pricing : Clearly communicate your fees to avoid misunderstandings and build trust with clients.
• Package Deals : Bundle services together for a discounted rate to encourage clients to utilize more of your offerings.
• Adjustments and Reviews : Regularly review and adjust your pricing as needed based on your business growth, expertise, and changes in the market.

What does it cost to start a Tax business?

Initiating a tax business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $6000 for launching such an business. Please note, not all of these costs may be necessary to start up your tax business.

Starting a tax business requires careful preparation, and one of the most important steps is to acquire the right tax equipment and supplies. This ensures you can provide professional services and comply with all legal requirements. Here are the essentials you'll need to get started:

• Tax Preparation Software: Invest in professional tax software that is IRS-approved for filing returns electronically.
• Secure Computers: Purchase reliable computers with strong security features to protect your clients' sensitive information.
• High-Speed Internet: Ensure you have a fast and stable internet connection for research and e-filing purposes.
• Printers and Scanners: Get high-quality printers and scanners for producing hard copies of tax documents and digitalizing paperwork.
• Office Supplies: Stock up on basic supplies like paper, pens, calculators, and file folders for organizing documents.
• Data Backup Solutions: Set up secure data backup systems, like cloud services or external hard drives, to prevent data loss.
• Fireproof Safes or Cabinets: Protect physical copies of sensitive documents from theft or damage in secure storage.

List of Software, Tools and Supplies Needed to Start a Tax Business:

• Tax Preparation Software
• Computer and Printer
• Fax Machine
• Accounting Software
• Tax and Accounting Manuals
• Internet Connection
• Phone Lines
• Office Supplies
• Business Cards

Having the right business insurance is crucial when starting a tax business, as it protects you from unexpected events that could otherwise jeopardize your operations. Different types of insurance cater to various risks associated with tax preparation services. Consider the following steps to ensure you're adequately covered:

• Research the types of business insurance available, such as Errors and Omissions (E&O) insurance, which is particularly important for tax professionals to cover claims related to mistakes or negligence.
• Contact several insurance providers to compare coverage options and premiums. It's essential to find a balance between comprehensive coverage and affordable costs.
• Understand the legal requirements in your region, as some states or countries may mandate specific insurance for tax preparation businesses.
• Consider additional insurance policies like General Liability insurance, Cyber Liability insurance, and Property insurance to cover all aspects of your business risk.
• Regularly review and update your insurance coverage to keep pace with the growth of your business and changes in tax laws and regulations.

Now that you've set the foundation for your tax business, it's time to attract clients and generate revenue through effective marketing. An impactful marketing strategy will not only help in building brand awareness but will also establish your reputation as a trusted tax professional. Here are key steps to begin marketing your tax services:

• Develop a Brand Identity: Create a memorable logo, a catchy tagline, and consistent branding materials to use across all marketing channels.
• Build a Professional Website: Ensure your website is user-friendly, provides valuable tax information, and includes clear calls to action for potential clients to engage with your services.
• Utilize Social Media: Engage with clients on platforms like LinkedIn, Facebook, and Twitter to share tax tips and updates, which can help establish your expertise.
• Network Locally: Attend local business events, join chambers of commerce, and collaborate with other businesses to gain referrals.
• Offer Workshops or Seminars: Host educational events to demonstrate your knowledge and attract clients seeking tax advice.
• Leverage Testimonials and Reviews: Encourage satisfied clients to leave positive reviews online, which can serve as powerful trust signals to prospects.
• Invest in Advertising: Consider pay-per-click ads, local print media, or digital advertising to reach a broader audience.

Once your tax business is well-established and running smoothly, it's time to consider expansion to scale up your operations and increase your client base. Here are some strategies to help you expand your tax business effectively:

• Franchising or Licensing: Explore the option of franchising your business model or licensing your brand to extend your reach into new markets without direct management of each location.
• Diversify Services: Add related services such as bookkeeping, financial planning, or business consulting to provide more value to existing clients and attract new ones.
• Invest in Marketing: Boost your marketing efforts by leveraging online platforms, social media, and referral programs to increase visibility and attract a broader client base.
• Technology Integration: Implement advanced tax preparation software and customer relationship management (CRM) tools to streamline processes and improve client experiences.
• Partnerships and Networking: Form strategic partnerships with financial institutions, legal firms, and business consultants to receive referrals and offer comprehensive services.
• Hiring and Training: Recruit skilled tax professionals and provide ongoing training to ensure high-quality services as your business grows.
• Geographic Expansion: Open new offices in underserved areas to tap into new markets, ensuring careful research and understanding of local tax laws.

More From Forbes

Key advantages of strategic tax planning for entrepreneurs.

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Chad Willardson, President & Founder of Pacific Capital and Best-Selling Author of Wealth Wired Differently.

Every business is different and unique, but one thing we’ve all got in common is our desire to really maximize the value and impact of every dollar that comes in the door of our business. Taxes can be a thorn in the side for many business people because they often don’t know how—or have the time—to handle their tax planning. As a result, a significant part of their earnings is subject to extremely high taxes, year after year.

As a founder, it's normal if you have many plates spinning at the same time and are unable to dedicate significant time to tax planning. It may actually feel as though you don’t have many options and that your profits being depleted to high taxes is inevitable anyway. But you’re doing yourself a disservice by neglecting the opportunity of strategic planning in this area of your financial life. And you’ve got every right to engage in proactive planning. As Arthur Godfrey said, “I am proud to be paying taxes in the United States. The only thing is—I could be just as proud for half the money.”

Adopt a proactive approach to tax planning.

For many entrepreneurs, the problem lies in the approach they take to taxes. They rely on tax preparers who act more like reactive number-crunchers than strategic partners: They collect your information, process it and deliver the dreaded news of how much you owe now that the year is over. There's often no discussion of strategy, no forward-thinking about minimizing your tax burden, no plan for keeping more of your hard-earned money.

What if I told you that the 7,000+ pages of the U.S. tax code are less like a list of rules and regulations and more like a coupon book? A way to see what coupons and incentives are set up for you to keep more of your earnings? This is exactly what proactive tax planning offers. It can identify “coupons” you can apply to your business, income and investments within the tax code—legal strategies you can leverage to minimize tax liability.

Elevate your tax team.

Many entrepreneurs, especially those who've built their businesses from the ground up, have outgrown their tax professionals. This isn’t always the case, but it may be that your original tax people haven't grown at the same pace and may not be professionally equipped to handle the complexity that you’ve evolved to. Simply collecting your year-end documents, filing your taxes, and footing the bill no longer serves your needs.

If you’re uncertain about whether you’ve got the right tax team for your situation, here are a few characteristics to look for:

1. Forward-Looking: Make tax firms that specialize in entrepreneurs at your level your starting point. The firm you select should be a partner that you can collaborate with throughout the year, not only as you approach the tax-filing deadlines. Your discussions throughout the year should include scenario planning for your business expansion, lending and investment planning. This can help you make decisions for yourself and your business in the most tax-efficient way.

2. Up-To-Date: With the tax landscape constantly evolving, it's important to have a certified partner who is constantly informed of the latest tax laws to help you effectively identify all the deductions and credits your business is eligible for.

3. Strategically Minded: Rather than you being the one sourcing ideas and strategies, your tax team should ask you strategic questions. Too often, a tax team doesn't offer much strategy or dig deep into your business and investment goals. They need to take the time to understand you and your business if they're going to advise you. They should also help you to make informed decisions about everything from your business structure to your loan and funding opportunities to how you pay employees and yourself.

Although you’ve likely already filed this year, it isn’t too soon to begin preparing for next year. Now is the ideal time to start ensuring you’ve got a stellar tax team in your corner — one that will go beyond basic number-crunching. Don’t feel stuck if you know you’re not getting the right kind of support. Remember, a dynamic tax advisor can guide you through various decisions and ensure you're maximizing your income for both personal and business needs.

Audit your business structure.

The way you structure your businesses and investments can significantly impact your taxable liabilities. Once you’ve found the right tax team to partner with, collaborate with them to audit the structure of your businesses and your estate plan. Perhaps you’re currently an LLC; your tax advisor may suggest an alternative, such as a C-Corp or S-Corp, that is more suitable for your specific needs, current situation and growth trajectory. Regardless, whichever you decide to pursue has its own set of advantages and disadvantages, both from a tax and legal perspective. It’s common for founders to start a business and set up a business entity on their own, only to later learn that this structure is not the most advantageous for their needs.

Let the countdown begin.

With Tax Day just barely behind us, the countdown to next year’s Tax Day has already begun. If you’re feeling frustrated with this year’s payout to the IRS, channel that energy into making more strategic financial decisions for next year. Remember, tax planning isn’t a one-size-fits-all strategy; the right strategic tax partner can help you claim more of the benefits relevant to your business and personal needs.

Seek out someone who proactively seeks solutions and plans ahead strategically to transform the tax season from a dreaded event into an opportunity to maximize your financial well-being. This can allow you to reinvest more into your business growth. Remember, it’s not how much you make—it’s how much you keep.

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General questions for taxpayers in bankruptcy, installment agreements and bankruptcy, balance due inquiry for liabilities that survive the bankruptcy, tax refunds during bankruptcy, bankruptcy resources, how can i speak to the irs about my bankruptcy case (added aug. 5, 2024).

Call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time. Be sure to have your bankruptcy case number available.

What is the difference between dismissal and discharge? (added Aug. 5, 2024)

A dismissal ends the bankruptcy protection and does not relieve debts. A dismissal ends all proceedings in the bankruptcy case (and in any adversary proceedings), and a discharge order is not entered. A dismissal may be voluntary if requested by the debtor. However, a dismissal may also be involuntary (i.e., without the debtor's consent) if the court orders a dismissal or grants a motion to dismiss filed by a trustee or creditor.

A discharge is a court order that offers relief by reducing or eliminating certain debts and prohibits the collection of many debts that arose prior to the filing of the bankruptcy. Generally, a discharge is granted:

• In an individual debtor's Chapter 7 case 60-90 days after the date set for the first meeting of creditors (11 USC 341 meeting);
• In a Chapter 11 case of a corporation when the plan is confirmed;
• In a Chapter 11 case of an individual when the plan is completed or when the court grants a hardship discharge; or
• In Chapter 12 and 13 cases when the plan is completed (3-5 years) or when the court grants a hardship discharge to the debtor.

Why did my spouse receive a bill if I was in bankruptcy? (added Aug. 5, 2024)

A spouse is not automatically subject to bankruptcy protection or discharge of debt when the other spouse files bankruptcy. If only one spouse filed for bankruptcy, collection action can be taken on the non-debtor spouse in non-community property locations.

Collection action cannot be taken against joint assets of the non-debtor spouse in community property locations. All property acquired during marriage is presumed to be community property. Because the non-debtor spouse's interest in community property also becomes a part of the estate, attempts to collect the non-debtor spouse's separate tax liabilities are precluded by the automatic stay in community property locations.

Can I get help to reduce my bill/debt? Am I eligible for an offer in compromise (OIC) while my bankruptcy case is open? (added Aug. 5, 2024)

The filing of a bankruptcy petition suspends most collection efforts. A bankruptcy discharge may provide relief to a taxpayer by reducing or eliminating certain debts. While in an open bankruptcy proceeding, a taxpayer is not eligible for an offer in compromise agreement.

How do we get a lien removed if I am in bankruptcy? (added Aug. 5, 2024)

Paying your tax debt in full is the best way to get rid of a federal tax lien. When conditions are in the best interest of both the government and the taxpayer, options for reducing the impact of a lien exist. You may be eligible for a lien withdrawal, subordination, or a discharge of property if specific conditions are met. Please visit Understanding a federal tax lien for more information.

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Can I make payments even though I am in bankruptcy? (added Aug. 5, 2024)

In certain conditions, individuals who have filed bankruptcy may make voluntary payments while in bankruptcy.

Voluntary payments made by an individual Chapter 7 debtor can be accepted by the IRS. See Chapter 7 - Bankruptcy Basics (United States Courts)  for information about eligibility for Chapter 7. Such payments would be applied to debt that is not eligible for discharge.

Payments would be considered property of a Chapter 13 estate and should be made through the bankruptcy plan. See Chapter 13 - Bankruptcy Basics (United States Courts)  for more information about a Chapter 13 bankruptcy.

For information regarding your case, have your bankruptcy case number ready and call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to speak with a technician.

Can I set up another payment arrangement? (added Aug. 5, 2024)

If you are currently in bankruptcy, your specific tax situation, court jurisdiction and bankruptcy status will determine which payment options are available to you. While you are in bankruptcy, you may contact 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to inquire about your eligibility for a payment plan.

If you have been discharged or dismissed and are no longer in bankruptcy, you can visit Online payment agreement application or contact Customer Service at 800-829-1040 for more information.

My bankruptcy is over; may I set up an installment agreement to make payments? (added Aug. 5, 2024)

If you are a qualified taxpayer, you can apply for a payment plan online to pay off your balance over time.

Individuals: You may qualify to apply for a long-term payment plan (installment agreement) if you owe $50,000 or less in combined tax, penalties, and interest, and have filed all required returns. You may qualify for a short-term payment plan (paying in 180 days or less) if you owe less than $100,000 in combined tax, penalties, and interest.

Businesses: You may qualify to apply for a long-term payment plan (installment agreement) if you owe $25,000 or less in combined tax, penalties, and interest, and have filed all required returns.

Sole proprietors or independent contractors may apply for a payment plan as an individual.

Please visit Online payment agreement application for more information.

Now that my bankruptcy is over, can I restart my prior payment plan (installment agreement)? (added Aug. 5, 2024)

When a taxpayer has an installment agreement and files bankruptcy, the IRS suspends but does not terminate the installment agreement during the bankruptcy. When the bankruptcy case is dismissed or discharged, and there are outstanding liabilities that survive the bankruptcy, we review your account to determine if a reinstatement or revision is appropriate. When this review is completed, you should receive a letter detailing your installment agreement status. Your specific tax situation will determine which payment options are available to you. You can view details of your payment plan, make changes, and obtain additional information by visiting Online payment agreement application .

Where do I send my payment? (added Aug. 5, 2024)

Pay online, by phone or with a mobile device. Visit Payments or the IRS2Go mobile app for all IRS payment options. If you plan to mail a payment, consider the electronic options first. It’s free to pay from a bank account (Direct Pay) or the Electronic Federal Tax Payment System (EFTPS). You can schedule payments and receive email notifications. Check the status of your account anytime at Online account for individuals . If you pay by check, money order, or cashier’s check, follow the payment instructions on the form you filed or notice you received.

Why wasn't my balance discharged? (added Aug. 5, 2024)

Only debtors who receive a discharge are eligible to have debts reduced or eliminated. If your case is dismissed, your debt is not relieved.

Why am I receiving bills now that my bankruptcy has been discharged? (added Aug. 5, 2024)

Not all debts are dischargeable or eliminated. Many tax debts are excepted from the bankruptcy discharge. The scope of the bankruptcy discharge depends on the chapter under which the case was filed and the nature of the debt. Chapter 7 debtors do not have an absolute right to a discharge; objections may be filed by creditors. Chapters 12 and 13 debtors are generally entitled to discharge upon completion of all payments under the bankruptcy plan except for debts that are otherwise non-dischargeable.

Why do I still owe a debt after my bankruptcy case concludes? (Chapters 7 and 13) (added Aug. 5, 2024)

Not all debts are relieved at the conclusion of a bankruptcy case. Sometimes penalties are discharged but not the taxes for the late filing of a tax return. Certain taxes are not discharged, such as trust fund taxes.

Chapter 7 discharge will eliminate (discharge) personal liability for tax debts older than three years unless your tax returns were filed late. Businesses do not receive a discharge since they are liquidated.

Chapter 13 discharge will eliminate (discharge) tax debts paid in the plan and tax debts older than three years unless returns were filed late.

Your attorney may provide information on your dischargeable taxes, or you may contact the IRS Centralized Insolvency Operation at 800-973-0424 Monday through Friday, 7: a.m. to 10 p.m. Eastern time. Be sure to have your bankruptcy case number available.

How much do I still owe? (added Aug. 5, 2024)

If you are currently in bankruptcy or your bankruptcy has recently concluded, call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to speak with a technician. Be sure to have your bankruptcy case number available.

If your bankruptcy case has been concluded, you may access your Online Account to view the amount you owe by tax year. For more information visit Online account for individuals .

Why is there a hold on my refund? (added Aug. 5, 2024)

You can receive tax refunds while in bankruptcy. However, refunds may be subject to delay, to turnover requests by the Chapter 7 Trustee, or used to pay down your tax debts. If you believe your refund has been held, delayed, turned over, or offset against your tax debts, you can check on its status by contacting the IRS Centralized Insolvency Operation at 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time.

Why did the bankruptcy trustee request my refund? Why didn't I receive it? (added Aug. 5, 2024)

A Chapter 7 debtor's refund from a tax year before the bankruptcy was filed is property of the bankruptcy estate. Even though the debtor may be in full tax compliance, the refund is subject to turnover to the Chapter 7 trustee if requested. A trustee may request a turnover when a debtor, a custodian, or any other entity in possession of property of the estate fails to turn over that property as required by the Bankruptcy Code. The IRS will honor valid trustee turnover requests and may send the refund to the trustee.

Why was my refund offset? (added Aug. 5, 2024)

The IRS can offset a pre-petition income tax refund against a pre-petition in-come tax liability while the automatic stay is in effect. The pre-petition period is the time before the bankruptcy is filed. Pre-petition taxes are incurred prior to the filing of the bankruptcy petition. Your specific tax situation and bankruptcy case will dictate how refunds are handled. For information regarding your refund, call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to speak with a technician. Be sure to have your bankruptcy case number available.

If your tax refund was offset for child support or a federal agency debt, please contact the specific agency or the Treasury Offset Program (TOP) Call Center at 800-304-3107 .

For additional tax information on bankruptcy, refer to Publication 908, Bankruptcy Tax Guide .

For information on the impact of bankruptcy on taxes visit Declaring bankruptcy .

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Economics for Humanity

People-centered economic development, a paradigm which puts people before profit and abstract numbers, tomsk, russia, introduction to tomskaya oblast, russia.

• Tomsk’s self-directed movement toward market reform and development
• Tomsk’s movement toward democratic development
• Best communication infrastructure in Siberia.  Tomsk was the main communications node between the Urals and Vladivostok.
• Nascent small business/enterprise sector primarily in need of small amounts of seed funding for start-ups, and expansion of existing small businesses.
• Abundant natural resources

The basic ingredients existed that I thought were needed for an economic resurrection.  The population of 600 thousand people were generally very well-educated among six universities in the city.  Internet was available, but limited to a 1 MB link that was parceled out and distributed among universities, businesses, and citizens.  Government was largely reform-oriented towards democracy and market economy.   Tomsk was the primary telecommunications node between Moscow and Vladivostok, making it an ideal location for replicating successful project components.  Small businesses were beginning to flourish despite severe financial constraints following the financial collapse of August 1998.

There were also critical food shortages in the region, children living on the streets because they considered orphanages intolerable, women having to resort to prostitution to feed their children, and a near-total lack of new economic opportunities.   Economic opportunities for women were routinely negotiated in bed, if at all.

After returning to the US, I spent most of the August 1999 reviewing notes and writing them up into a proposal with three key ingredients:

• a community development bank to provide financing to would-be entrepreneurs to create their own business, without need for material collateral because almost no one had that collateral aside from mafia, who just took what they wanted;
• emergency food relief
• assistance to children in or out of orphanages.

I sent the proposal to President Clinton, who had been an unswerving ally in prior efforts (accounting for POW/MIAs missing in Southeast Asia.)  I asked him to refer it on to appropriate US agencies if he found it worth considering.  Tomsk was awarded the fourth and final USAID Regional Initiative in Russia three months later in December 1999.  That initiative encompassed the three critical objectives I had outlined, along with 34 other components.  The result was the Russia/US Regional Initiative in Tomsk oblast.  US Russia Business Council wrote it up as follows:

The Russia/US Regional Initiative in Tomsk ran from January 2001 to December 2005. The Tomsk Microfinance Bank, a key component recommended and requested by P-CED, remains in operation and has been fully self-sufficient and profitable since 2003. To date, more than fifteen thousand loans have supported the creation of thousands of new businesses.  More than 80% of loans went to women.

I returned in April 2000 on invitation from Institute for Optical Monitoring, Tomsk Akademgorodok (Academic city).  The main objective was to directly assist former weapons scientists in converting their skills to peacetime business endeavors.  This was written up in the Tomsk Regional Business Review .

P-CED. ‘A New Way of Doing Business’ since 1997

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Money blog: Coca-Cola launching new flavour in collaboration with popular biscuit - and fans are divided

Welcome to the Money blog, a hub of personal finance and consumer news. Our focus has been on inflation rising - while other posts include Coke launching a new flavour with Oreo. Leave a comment on any of the stories we're covering in the box below - we round them up every Saturday.

Wednesday 14 August 2024 16:35, UK

• UK inflation rises for first time since December - analysis
• Wizz launches unlimited flight package for £445 - but there's a catch
• Coca-Cola launching Oreo drink - and fans are divided

Essential reads

• Is this the end of the British pub?
• What's gone wrong at Asda?
• Best of the Money blog - an archive of features

Tips and advice

• TV chef picks best cheap eats in London
• Save up to half price when visiting top attractions with this trick
• 'I cancelled swimming with weeks of notice - can they keep my money?'

Ask a question or make a comment

John Lewis is looking to cut 153 jobs as part of a staff shake-up across its stores. 

The high street giant claims the proposals are designed to improve customer service, ensuring workers are "in the right place, doing the right tasks at the right time". 

It is hoping the job cuts will be through voluntary redundancy and natural attrition - which covers people leaving through retirement, resignations or moving job. 

Staffing changes will also see currently separate roles for serving front and back of house combined.

John Lewis is also investing £5m in digital headsets for store workers to communicate better with one another - in a bid to improve service.

The changes, which were announced to staff yesterday, follow a similar staffing overhaul at sister business Waitrose.

A spokesman for John Lewis said: "We're seeking to make sure partners are in the right place at the right time to help customers.

"We're also removing unnecessary tasks and introducing new technology to make their roles easier.

"We carried out similar changes in Waitrose earlier this year, with customer and partner feedback increasing significantly since.

"It's since been ranked the number one supermarket for customer satisfaction."

Coca-Cola is launching an Oreo-flavoured drink in collaboration with the biscuit manufacturer.

The limited edition, zero-sugar drink will be released from September in a black and white can containing what Coca-Cola describe as "flavourful hints inspired by Oreo cookies".

At the same time, Oreo will release a Coca-Cola flavoured biscuit.

Eugenia Zalis, global head of marketing for Oreo-maker Mondelez International, said she "cannot wait to see the reaction" from customers - but they're already coming in before the products have even hit the shelves.

Multiple X users were quick to deploy the Jurassic Park meme inspired by Jeff Goldblum's character, Ian Malcolm: "Your scientists were so preoccupied with whether or not they could, they never stopped to think if they should".

Another added: "I will happily eat Oreos while drinking a Coke Zero, but I don't want either of these things."

Others were more enthusiastic, simply writing: "Need."

Ms Zalis was confident about the collaboration, saying: "We have truly upped the ante."

The beverage will be available at major retailers and Pizza Express, Popeyes and Slim Chickens, Coca-Cola said.

By Daniel Binns, business reporter

Annual inflation in the US fell to 2.9% in July, down from 3%, according to official data released this lunchtime.

The announcement helps pave the way for the US Federal Reserve for cut interest rates next month.

This matters to monetary policy makers in the EU and UK as they don't like to be too misaligned with the US - for fear of impacting currency strength, among other reasons.

The annual consumer prices index (CPI) rate for July was the lowest since March 2021 and came in below market expectations.

In the immediate aftermath of the publication of the latest figures, financial markets upped their expectations that the Fed would cut interest rates by 0.25 percentage points, pricing in the likelihood of such an outcome at 60.5%. 

The likelihood of a bigger 0.5 percentage point cut was judged to be 39.5%.

Earlier in the day, the likelihood of a 0.25 or 0.5 percentage point cut had been almost 50-50.

The first increase in inflation this year is less a reason for panic than a signal that, after almost three years of wild volatility, the UK's measure of price increases is returning to a period of what looks far more normal fluctuation.

The primary reason CPI stepped up to 2.2% in the year to July is statistical, the base effect of energy prices falling less this year than they did in July 2023. A year ago the Ofgem retail price cap fell by more than £1,100, 10 times more than the £110 reduction last month. That means that while energy prices are lower than they were, annual inflation increased.

The Bank of England had forecast this move upwards from its target rate of 2% and used it to justify its cautious tone around interest rates, even as they were cut earlier this month for the first time since the hiking cycle began.

Below the headline rate of CPI were numbers that will give the Bank some confidence that it can afford to cut rates further by the end of the year.

Core inflation, a measure that removes volatile food and energy prices and indicates the underlying "secondary" effects of inflation, fell slightly from 3.5% to 3.2%. 

Goods inflation remains in negative territory at minus 0.6%, but that was an increase from minus 1.4% the previous month, driven in part by food inflation, which increased to 1.8% after 15 consecutive monthly falls. 

Inflation in services, which make up the majority of the British economy, fell to 5.2%. Coming a day after wage inflation also eased, that fuelled expectations that further rate cuts are coming, though not necessarily at the next Bank of England meeting in September. 

Market expectations of a cut in September rose to 45%, meaning a narrow majority expect rates to be held at 5%, with the prospects of further cuts before the year-end priced at 90% in November and 97% in December.

Watch Kelso's TV analysis here...

Every Wednesday we ask top chefs to pick their favourite Cheap Eats where they live and when they cook at home. This week we speak to TV chef Judy Joo, who co-owns the popular Seoul Bird in London.

Hi Judy, can you tell us your favourite places in London where you can get a meal for two for less than £40?

Since 1900,  Paul Rothe & Son  in Marylebone has been crafting some of the best sandwiches in London. Lucky for me, I live just around the corner from this charming, historic deli. 

My go-to is their famous pastrami and cheese, piled high with pickle, mayo, and mustard. Occasionally, I'll switch things up with their epic coronation chicken, or if I'm feeling adventurous, a jacket potato with tuna and sweetcorn. It's quintessentially British, and I love it. 

Trejo's Tacos has crossed the pond, opening its first international outpost in Notting Hill. Founded by actor Danny Trejo, this canteen boasts a cult following in Los Angeles (myself included) and has quickly become my favourite spot for tacos in London. 

My usual order includes a plate of Baja fish and spicy shrimp tacos, dosed in their house hot sauce and perfectly complemented by one of their stellar OG margaritas or homemade horchata. I also love their house-made guacamole and salsa served with their truly addictive freshly fried corn tortilla chips. I just munch away while thinking of the southern California sun. 

I live near Edgware Road, an area renowned for its vibrant Middle Eastern community and fantastic cuisine. Maroush , a London institution with multiple venues across the city, remains a favourite, especially the original one on Edgware Road.

The chicken or lamb shawarma is the star dish, slow-cooked on vertical rotisseries, infused with aromatic spices, and expertly sliced off with sabers. It's the perfect late-night snack after a few too many pints. I love their tomato okra stew with rice - so comforting and warming. 

Tucked away in the basement of an unassuming British pub down a quaint mews street in Marylebone is Liu Xiaomian . 

I usually order the minced pork xiaomian - toothsome wheat noodles swimming in a red chilli broth, then dressed with seasoned pork and fragrant spring onions. The numbing pork wontons are another standout, delivering what their name promises in true mala style. Don't miss the cucumber side salad which offers a refreshing respite for your palate.

What is your go-to cheap eat to cook at home when you have a night in?

My go-to budget-friendly meal for cooking at home is pimped-out instant ramen noodles. 

If I am feeling spicy, I'll grab a pack of Shin Ramen and add fresh veggies and leftover proteins from the fridge. 

Spinach, mushrooms, corn, spring onions, leftover roasted chicken, and some frozen dumplings usually make their way into the pot. Absolutely anything goes!  

And, to finish, I'll crack an egg in and let it cook on top of the noodles just until the yolk is set, but still gooey. It's a quick, delicious meal that hits the spot every time.

We've spoken to lots of top chefs - check out their cheap eats from around the country here...

By Sky News Data and Forensics Unit

As we've discussed throughout the morning, the rate of inflation grew to 2.2% in July - the first time since December last year that it has increased.

Which shop prices are increasing fastest?

Olive oil costs nearly two fifths more than it did last year, with prices for 500ml-1 litre rising from £6.39 to £8.83 in just 12 months.

The Money blog looked at the reasons why here...

Plums, meanwhile, are up by a quarter, from £3.08 per kilo to £3.57.

Food and drink products are responsible for seven of the 10 highest increases since last year.

For fans of a slicked-back hairstyle, non-food items like hair gel increased by a third, and for any pet owners, the price of a small mammal cage nearly hopped up by a fifth.

Top five price rises:

• Olive oil (500ml-1litre): up 38%, £6.39 to £8.83
• Hair gel (150-200ml): up 33%, £3.08 to £4.10
• Plums (per kg): up 25%, £2.85 to £3.57
• White potatoes (per kg): up 20%, 74p to 89p
• Cauliflower (each): up 20%, £1.07 to £1.28

Fifty-six of the 156 types of food and drink tracked by the ONS have actually become cheaper since last year. Many of these were store cupboard staples like pulses, dried pasta, and canned tomatoes.

Top food price decreases:

• Pulses (390-420g): down 13%, 77p to 67p
• Frozen prawns (per kg): down 8%, £18.77 to £17.24
• Cheddar cheese (per kg): down 8%, £9.49 to £8.77
• Spreadable butter (500g): down 7%, £4.18 to £3.90
• Frozen berries (per pack): down 6%, £2.53 to £2.37

Of non-supermarket items, electric heaters have been some of the biggest price fallers - by 22%.

How much has your individual spending changed in the last year?

Use our calculator to see how much prices are rising on the groceries, clothing and leisure activities you pay for...

We've had some more ONS data this morning - this time on house and rent inflation.

While the figures are largely unchanged from a month ago, the rental stats in particular are worth outlining as they illustrate the difficulties still facing renters.

Official data shows:

• Average UK private rents increased by 8.6% in the 12 months to July 2024, unchanged from in the 12 months to June 2024;
• Average rents increased to £1,319 (8.6%) in England, £748 (7.9%) in Wales, and £965 (8.2%) in Scotland;
• In Northern Ireland, average rents increased by 10% in the 12 months to May 2024;
• In England, rents inflation was highest in London (9.7%) and lowest in the North East (6.1%).

On the housing market, we learned:

• Average UK house prices increased by 2.7%, to £288,000, in the 12 months to June 2024 - unchanged from a month before;
• Average house prices increased in England to £305,000 (2.4%), in Wales to £216,000 (1.8%), and in Scotland to £192,000 (4.3%).

By Sarah Taaffe-Maguire , business reporter

News of an increased rate of price rises was welcomed by UK markets but it hit the pound. 

While inflation has increased, the fact the figure came in lower than expected could be a boost to the mainly UK-based companies that make up the FTSE 250, which rose 0.47% on the news, as did the 100 most valuable companies on the exchange, the FTSE 100. 

The pound, however, fell from its highest since late July and now £1 buys $1.2838 and €1.1659. 

Energy costs remain elevated with the benchmark oil price $81 for a barrel of Brent crude oil. 

Gas prices are still below the 100p a therm (the measurement for heat) high seen on Monday evening but not by a whole lot at 96.65p a therm. 

The biggest riser of FTSE 250 companies was gambling tech company Playtech.

Following Sky News reporting that gambling giant Flutter is in talks to buy the consumer arm of Playtech for £2bn, its share price shot up 13.57%.

Wizz Air has launched Europe's first unlimited flight package - but there are a few things you should know before signing up. 

The All You Can Fly membership costs £534 for 12 months, and is currently on sale until tomorrow for £445. 

Subscribers can use the deal to travel to more than 800 destinations as many times as they like over the course of a year, starting from 25 September. 

Here's the catch - customers must book the flights within 72-hours of them taking off. 

Each flight also comes with a £9 booking fee, which must be paid in addition to the membership. 

And, the costs of booking a seat and adding luggage is also not included. 

On the Wizz Air website, a "seat protection fee" ranges from ‎€80 (£68.31)  to ‎€100 (£85.39), and adding a bag costs between €11 (£9.39) and ‎€120.50 (£102.89). 

It's also important to note that there are only 10,000 memberships available. 

Wizz Air's commercial officer Silvia Mosquera said: "We are thrilled to be the first to introduce this one-of-a-kind membership for travellers in Europe. 

"The Wizz All You Can Fly membership will give customers hundreds of spontaneous travel options for a fixed price, giving them freedom to fly whenever is convenient without paying extra."

You can read all the terms and conditions of the All You Can Fly package here .

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