Start a Tax Preparation Business

People dismiss it as seasonal work, but a strong tax season can fund an entire year and returning clients come back automatically every spring.

1. 1

   Get your PTIN and EFIN

   Register for an IRS Preparer Tax Identification Number (free, takes minutes), then apply for an Electronic Filing Identification Number; the EFIN can take 45 days, so start early.

2. 2

   Train before the season

   Complete a tax prep course like the IRS VITA training or an H&R Block income tax course, and check whether your state (like California or Oregon) requires preparer registration.

3. 3

   Pick your software and pricing

   Choose professional software like Drake, TaxSlayer Pro, or ProSeries, and set per-form pricing: $200 to $350 for a 1040 with a Schedule C beats a cheap flat fee.

4. 4

   Set up shop legally

   LLC, E&O insurance, and a written data security plan (the IRS requires one for preparers). Add a secure client portal so documents never travel over plain email.

5. 5

   Book 20 clients before January

   Announce to your network in the fall, partner with a bookkeeper or real estate office for referrals, and offer early-bird pricing. Pre-booked clients make your first season profitable.

6. 6

   Deliver a season worth repeating

   Fast turnaround, a review call explaining each return, and a post-season summary of next year's savings. Returning clients and their referrals are the entire growth model.

7. 7

   Add year-round revenue

   Extend the season with quarterly estimates for self-employed clients, bookkeeping retainers, and IRS notice responses so the business earns beyond April 15.