Starting a Bookkeeping Business
Skills, Certifications, Software, Pricing, Client Onboarding, Monthly Close Workflows, and Growing from Solo Bookkeeper to Small Firm
Professional Services · $0.99 PDF guide
Starting a Tax Preparation Business
PTIN, EFIN, AFSP and Enrolled Agent Paths, State Rules, Software, Pricing, Due Diligence, Data Security, and Building a Year-Round Practice
14 chapters · about 9,292 words (~31 pages) · instant PDF download · by Omer Muneer Qazi
What this guide helps you do
- Choose the right credential path: PTIN, AFSP, enrolled agent or CPA.
- Get your EFIN, meet state registration rules and set up your legal entity and insurance.
- Meet due diligence rules for EITC, child tax credit, AOTC and head of household returns.
- Build a written information security plan and protect client data.
- Price returns profitably, market your practice and build year-round revenue.
Table of contents
Chapter 1: The Tax Preparation Opportunity
- What you are really selling
- Who your clients are
- What a tax preparation business can earn
- The seasonal reality
Chapter 2: Credentials: PTIN, AFSP, Enrolled Agent, and CPA
- Layer 1: The PTIN (required for everyone)
- Layer 2: The Annual Filing Season Program (AFSP), voluntary
- Layer 3: Enrolled Agent (EA)
- Layer 4: CPA and attorney
- Comparing the paths
- Getting the skills
Chapter 3: Your EFIN, E-Filing, and State Registration
- Why you need an EFIN
- The application steps
- Keeping your EFIN in good standing
- The e-file signature
- State registration and licensing
Chapter 4: Legal Setup, Insurance, and Engagement Letters
- Business structure
- Independent vs franchise
- Registrations checklist
- Insurance
- The engagement letter
Chapter 5: Software, Bank Products, and Your Office
- Professional tax software
- Research tools
- Bank products
- Office setup
- Startup budget
Chapter 6: Due Diligence, Ethics, and Preparer Penalties
- Circular 230
- The four due diligence requirements
- Due diligence interview example
- Other preparer penalties to know
- Ethics in practice
Chapter 7: Data Security and the Written Information Security Plan
- The rules that apply
- WISP outline
- Minimum controls checklist
- If you are breached
Chapter 8: Pricing Tax Preparation Services
- Pricing models
- Typical fee ranges
- Building your fee schedule
- Sample fee schedule
- Pricing rules of thumb
- First-season profit example
Chapter 9: Tax Season Workflow
- The client journey
- Document checklist for clients
- Review checklist
- Managing capacity
Chapter 10: Marketing a Tax Preparation Business
- Timing your marketing
- Google Business Profile and local SEO
- Other channels
- Advertising rules
- Retention
Chapter 11: Hiring and Building Year-Round Revenue
- Seasonal staff
- Year-round revenue streams
- Handling IRS notices
- Practice valuation
Chapter 12: Common Mistakes to Avoid
Chapter 13: Your 30/60/90-Day Launch Plan
- Days 1-30: Credentials and setup
- Days 31-60: Systems
- Days 61-90: Marketing and readiness
Chapter 14: Final Checklist
Who it is for
- People who want to prepare tax returns for pay, full-time or seasonally.
- Bookkeepers who want to add tax preparation to their services.
- Seasonal preparers at chains who want to open their own practice.
Free sample · chapter 1 in full
What you are really selling
Clients do not want a tax return. They want:
- Confidence that the return is right and they will not get a letter from the IRS.
- The biggest legal refund or smallest legal bill, with every credit and deduction they are entitled to.
- Time and stress saved: no software to learn, no forms to puzzle over.
- Someone to call when a notice arrives or life changes: a new baby, a side business, a house sale.
The fourth point is where long-term value lives. A preparer who answers the phone in July keeps clients for decades.
Who your clients are
| Client segment | Typical return | Fee level | Notes |
|---|---|---|---|
| W-2 employees, standard deduction | Form 1040 with few schedules | Low | High volume, price-sensitive, early filers |
| Families claiming credits | Form 1040 with EITC, child tax credit | Low to moderate | Strict due diligence rules (Chapter 6) |
| Itemisers and investors | Schedule A, Schedule B and D, Form 8949 | Moderate | Brokerage forms, often late documents |
| Self-employed and gig workers | Schedule C, SE, quarterly estimates | Moderate to high | Need year-round help; good bookkeeping upsell |
| Landlords | Schedule E, depreciation | Moderate to high | Loyal and refer other investors |
| Small business entities | Forms 1065, 1120-S, 1120 | High | Require deeper skill; extension-heavy |
| Expats and nonresidents | Foreign income, FBAR, treaty issues | High | Specialist niche |
| Clients with IRS problems | Back returns, notices, payment plans | High | Representation requires EA, CPA, or attorney status (limited exceptions) |
New preparers usually start with individual returns, including Schedule C and Schedule E, and add business entities as their skill grows.
What a tax preparation business can earn
Rough planning figures, as of 2026 (verify for your market):
| Scenario | Returns per year | Average fee | Annual revenue |
|---|---|---|---|
| Part-time, first season | 50-100 | $250 | $12,500-$25,000 |
| Solo, established | 300-500 | $350 | $105,000-$175,000 |
| Solo with seasonal help | 600-900 | $375 | $225,000-$337,500 |
| Small firm, year-round services | 1,000+ returns plus bookkeeping and representation | Varies | $400,000+ |
A solo preparer can typically complete 300 to 500 individual returns in a season with good systems, depending on complexity. Above that, you need seasonal staff.
The seasonal reality
| Period | What happens |
|---|---|
| October-December | PTIN renewal, continuing education, software purchase, marketing, organiser mail-outs |
| January | IRS opens filing season, usually in late January; early filers book appointments; W-2s and 1099s arrive by January 31 |
| February | Peak for refund-seeking families; refunds involving EITC or the additional child tax credit are held until mid-February by law |
| March | Partnership and S corporation returns due March 15 (calendar year) |
| April | Individual deadline April 15 (unless it falls on a weekend or holiday); extensions filed |
| May-September | Extended returns, notices, amended returns, planning, bookkeeping |
| September-October | Extended business returns due September 15; extended individual returns due October 15 |
Expect to work 60-70 hour weeks from February to mid-April. Plan your personal life, childcare, and health around it.
Keep reading in the full guide.
Buy the PDF — $0.99Free guide
Read first: How to Become a Tax Preparer: PTIN, EFIN, AFSP and State Rules Explained
How to become a paid tax preparer in 2026: get a PTIN, earn the AFSP Record of Completion, apply for an EFIN and check state rules, with costs and timing.
Frequently asked questions
Do you need a license to prepare taxes?
There is no single federal license. Every paid preparer needs a PTIN from the IRS. Some states, including California, Oregon, Maryland and New York, add their own registration, education or licensing requirements. Enrolled agents, CPAs and attorneys hold credentials with full IRS representation rights.
How much does a PTIN cost?
The IRS fee to obtain or renew a PTIN is $18.75 for 2026 and for 2027. PTINs expire on December 31 and must be renewed every year.
How long does it take to get an EFIN?
The IRS says it can take up to 45 days from submission to approve an e-file application, including fingerprinting and a suitability check, so apply well before filing season.
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