Best Home Business For  Tax Preparation Service

 Tax Preparation Service

Start-up cost: $5,500–$15,000
Potential earnings: $40,000–$100,000
Typical fees: $25–$50 per hour; more if complex
Advertising: Referrals, networking, ads in local publications and Yellow
  Pages, direct mail
Qualifi cations: An interest in people and their situations, patience,
  excellent math skills, thorough understanding of tax
  laws and calculations; CPA certifi cation helpful but not
  mandatory
Equipment needed: Computer, phone, high-speed Internet access, fax, office
  equipment (including copier), specialized tax software,
  reference manuals, business cards
Staff required: None
Hidden costs: Time and money for continuing education, if needed

What You Do

Income tax regulations and their associated forms are often too complicated for the average person to comprehend. Making heads or tails of tax forms, then, is a much-needed service and one that people often don’t mind paying for (remind them that income tax preparation fees are tax-deductible, and you’ll sell them even more on your service). You obviously need to have a thorough knowledge of tax law, tax preparation, and related forms to succeed, but you don’t need to study for a license unless you want certification as a CPA or other designation. This is complicated, detailed work; our tax laws are cumbersome and confusing. It would be quite benefi-cial to take a training course before you begin. This would not only ensure that your skills are adequate, but would give you a feel for whether this work is for you. Tax preparation can earn a talented, detail-oriented business owner a very nice income.

What You Need

Detailed tax guides, special software, errors and omissions insurance, a good quality printer and copier, and the usual computer and office equipment will be required. You may be saving some ink and paper by e-fi ling, but you’ll still need to print a client copy of each document. Depending on what you need, your office can be set up for as little as $3,500. Charge at least $25–$50 an hour for your services; more if the job looks complex.

Keys to Success

Since people will always have to pay taxes, you will never run out of potential clients. IRS guidelines are complex and confusing to most citizens, so knowledgeable tax preparers are in great demand. However, constant upgrading of skills is required to meet the changes in forms and regulations. Tax preparation is seasonal, which means cash flow can be uneven; you might add other services to fill in the slower months.

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