How to Build and Grow a Successful Tax Practice
Taxes are stressful for both payers and preparers. In fact, 58% of tax preparation companies fail. MBA Financial & Accounting Solutions is one of the fortunate businesses that have not only survived but thrived. We manage to not only run a successful tax business but also one that has become the “go-to” tax service company in Los Angeles.
Our main objective as knowledgeable tax professionals is to put people’s minds at ease, save them money, and help them create and achieve their financial goals by engineering a thoughtful and strategic tax plan. Starting a tax business was great for us because we were building careers in a field we tremendously enjoyed. But, we also viewed it as providing a valuable service to our Los Angeles community.
If your goal is to start a tax practice, these are the criteria to ensure success:
Education
It’s a myth that you must become a CPA or have an accounting degree in order to become a tax professional. A successful tax practice, however, does require the right education and, if you’re going to open a tax preparation business, you will need hands-on experience, an understanding of tax laws, and continuing education for the life of your practice.
Become a Registered Tax Preparer
It all starts by taking the necessary courses needed to qualify you as a Registered Tax Preparer in your state. In addition, the IRS also recommends that you take the IRS Enrolled Agent designation, which allows you to practice in front of the Internal Revenue Service.
Once achieved, continuous CPE and Education are needed to maintain your license and keep up with the changes and new tax laws.
Website and Brand Name
You must create a website for your practice and, eventually, develop a strong, trusted brand name. Make it easy for people searching for a tax professional in your area to find you. Creating a brand name that reflects what you do is an excellent place to start, hence our business name: MBA Financial and Accounting Solutions versus just using your name for your business.
You’ll also want to have social media accounts for your tax business, such as LinkedIn and Facebook. Having an online presence will help people find and interact with your business.
Effective Marketing Strategies
You’ve completed your education and created your brand name. What’s next? How do you go about building a clientele for your new business? How do you inform your community that you’re open for business?
The answer is simple. Digital marketing.
Digital marketing provides every business the opportunity to market its brand easily and effectively by targeting the relevant demographic, i.e., age, gender, race, income, political affiliations, etc.
Some effective digital marketing strategies to consider for your tax businesses are:
- Ad campaigns
- Email Marketing
- Industry events
- Networking
- Host financial planning seminars
These are just a few strategies that you can use to get started. When you offer valuable and helpful content to your target audience, you’ll begin to be seen as an expert in the tax and financial field.
Calculate a healthy profit
As a tax preparation specialist, you are in the business to make money. Therefore, your ability to profit from your endeavors should be one of the main drivers of your business. Before you prospect and sign your first client, you’ll need to accurately calculate your cost of operating so you know exactly how much you need to charge to maintain your overhead and make a healthy profit at the end of the day. This article can show you how to break down your revenue and expenses so you can become a viable and competitive tax business.
Running a successful tax business is not an easy task. It requires a lot of dedication, hard work and continuous improvement. But, it’s worth it. Your responsibilities toward the business, your colleagues and your community increase but so does your brand. You’ll become the trusted point of reference for their tax needs.