Automating Income Tax Preparation

[petethepeddler]

Its getting close to that time of year and with my background in running an income tax business, I figured I'd pose the question. Now I know some would say to write software and sell it to millions, thats been done many times over. I'm looking more for the face to face income tax prep, or how to eliminate that face to face time. A large segment of the population use whats called refund anticipation loans, these can provide the taxpayer with their refund in as little as 1 hour instead of the usual 10 days and is the reason this segment doesn't use a tax program to do their taxes. This is where a lot of places can make some money.

I've toyed with the idea of a stand alone kiosk type thing but I'm sure there would be compliance issues with the banks that offer the refund loans. That would be a good reason why the tax software companies don't offer refund loans.

So what do you guys think? How would you automate an income tax prep business?

 

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[petethepeddler]

No one has any ideas? Discussion starters?

 

[TaxGuy]

There's many ideas, considering this is the route I am personally taking I can tell you that there are three ways to automate this type of business:

1) Content System - package information and sell it, most likely in an eBook form

2) Software System - develop a newer/better software product either geared towards tax professionals or at home use. One such need is to find a niche that needs a better, easier way to plan for their taxes and keep track of expenses.

3) Distribution System - FRANCHISE!

My personal hero is John Hewitt as he excelled in ALL three! First he started as an H&R Block employee whose revolutionary idea of utilizing software to prepare taxes was originally rejected only to become the industry standard(funny since my wife and I took the H&R Block course that was expanded this year to involve more time on the computer). Not only that, but his first venture of Jackson-Hewitt was not enough, after his non-compete contract expired he went ahead and started ANOTHER successful tax franchise - Liberty Tax Service, thus he's responsible for 2 out of the 3 main store-front tax prep franchises.

If you'd be interested in discussing strategy for the upcoming season, please don't hesitate to contact me as technically we're not competitors as we're not in the same Metropolitan Market and hopefully we can bounce some ideas off of each other to help better build each others' practices

 

[petethepeddler]

There's many ideas, considering this is the route I am personally taking I can tell you that there are three ways to automate this type of business:

1) Content System - package information and sell it, most likely in an eBook form

2) Software System - develop a newer/better software product either geared towards tax professionals or at home use. One such need is to find a niche that needs a better, easier way to plan for their taxes and keep track of expenses.

3) Distribution System - FRANCHISE!

My personal hero is John Hewitt as he excelled in ALL three! First he started as an H&R Block employee whose revolutionary idea of utilizing software to prepare taxes was originally rejected only to become the industry standard(funny since my wife and I took the H&R Block course that was expanded this year to involve more time on the computer). Not only that, but his first venture of Jackson-Hewitt was not enough, after his non-compete contract expired he went ahead and started ANOTHER successful tax franchise - Liberty Tax Service, thus he's responsible for 2 out of the 3 main store-front tax prep franchises.

If you'd be interested in discussing strategy for the upcoming season, please don't hesitate to contact me as technically we're not competitors as we're not in the same Metropolitan Market and hopefully we can bounce some ideas off of each other to help better build each others' practices

That sounds great!

I too have great respect for John Hewitt. I didn't know much about him until I had the opportunity to attend a prospective franchisee open house. If I had the opportunity financially to open a Liberty Tax franchise I probably would have. I truly look to them as the bar thats set to rise above.

Currently Im working with a company that began 1941 in New York City. I know its not exactly fastlane. But I'm working independent from them and leveraging their name and back office support. They are primarily focused on the upstate ny market, within driving distance of their main office in Grahmsville NY. Since I've moved out of the area, I'm focused on the NorthEast PA Market.

I am very interested in speaking with you and gaining knowledge into other tax firms take on things. PM me and maybe we could exchange contact info.

Thanks.

 

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