How much can I make preparing taxes?

[Simone]

I am taking all of the new certification courses and excited for next year's tax season, but how much can I expect to make my first year? How many clients should I expect to have? I am going to go to clients, work with them via phone, fax, email, and by any other means necessary. I'm buying business cards, flyers, brochures and leaving them around college campuses, local businesses, going to my church, and harassing everyone I know asking for help in spreading the word. To top it off I will offer an incentive program. I am an extremely hard worker and I will pound pavement, hang door hangers, and advertise over social media day in and day out to get as many clients as possible. How many clients can I reasonably expect to bring in with this much drive and dedication? Is 300-500 an outlandish figure?
I should have been a lot more specific! I plan on marketing myself as a simple return preparer, forms 1040 A and 1040 Ez. Until I get enough start up money I'll be using the new pay as you go intuit program. Pricey, yes, but I have to start from somewhere. I'm marketing to primarily college students, young mothers, and single tax payers. I am making sure to be incredibly specific about that in my advertisements and when i talk to people.

[Bobbie]

Sure does sound like you have a goof plan for this purpose and time in your life and 300 to 500 for your first year of being a IRS RTRP during the 2013 tax filing season MIGHT be possible BUT could be kind of high for your first year in this business. Good Luck
Hope that you find the above enclosed information useful. 09/12/2012

[Bostonian In MO]

If you are just learning now, do yourself a serious favor and work for someone else for at least two years before striking out on your own. Three to four years would be better. You might be "book smart" but that is only a license to learn; you are in no way prepared to do tax returns for a broad spectrum of clients yet.

You will run into situations that you will not be familiar with and have no experience with, virtually from day one. You will need the advice and counsel of a seasoned professional to become comfortable with handling those situations. It takes experience to develop the judgment and acumen to solve complex tax problems.

Expecting 300 to 500 clients in your first year is utterly outlandish. Even if you do, you'll be in so far over your head that your failure is virtually assured. There are experienced CPAs and EAs who have fewer clients and make a ton of money with them but they focus on high-end clientele with complex tax matters. You might be able to attract 300 simple customers -- single W-2, standard deduction, no dependents -- that you can get $50 a whack from but by the time that you shell out $2,000 for professional software and another $2,000 for computers, a firewall, and secure storage, you'll be lucky to net $10,000.

Business clientele are going to expect you to be able to guide them in handling more than just their tax matters. They will need assistance with bookkeeping and basic to moderately complex accounting matters. You don't need to be a CPA to handle that necessarily but if you don't have experience in such matters and are unfamiliar with accounting standards, you'll be bleeding customers faster than you can attract new ones. And if you get a rep for being eager but less than competent, you won't be able to give away your services for free.

[Judy]

Probably quite a high estimate of clients. And do you have any experience doing taxes? You don't mention any, or what formal education you have. You'd be a lot better off working with someone else for at least a couple years before going out on your own. You'd be surprised how many twists even simple returns have.

What do you plan to use for software? Professional software is very expensive, and it's illegal to use things like the personal TurboTax when preparing returns for pay.

[tro]

first of all you don't mention your qualifications, if you are not registered with a PTIN and passed the competency exam it won't matter how much you advertise, you are not eligible to prepare taxes
if all this is done, and you have not had any experience previously and no established business location, you probably won't prepare many
300 to 500 is way out of reach for a newbie, that only comes with established business year after year

[IntellectualBig734]

Your business model is fatally flawed. By focusing solely on the 1040-EZ and 1040-A crowd you will be cutting yourself short of the experience necessary to make some real money in the tax prep field. You might be able to snag $75 per return but you'll be turning around and giving 1/3 of that to Intuit. Once your other costs are covered, you'll be making considerably less than minimum wage.

Take the Block course and strive to ace it. That should get you an offer of temporary part-time employment during the tax season. Try to get located in a year-round office with a full-time EA on staff and latch on to him or her like a hagfish on a flounder. Bust your butt cranking out returns and take on every return that comes your way. Ask questions constantly. If you have any doubt at all, ASK. Get a rep for being someone who works hard, wants to learn, and strives for perfection.

In your spare time, study for your EA exam. You can gain the knowledge to pass it with a couple of years of experience and a few hours of dedicated study every day. Once you pass your EA, consider setting up your own practice. That's if Block does not make you a pretty lucrative offer of full-time employment. At least at that point you'll have options and a pretty good shot at success whichever road you choose.

[acmeraven]

First year after expenses you might make as much as 12K. After 40 plus years and with over a thousand returns a year I pull in about 150K gross.