Tax preparers today face competition from a variety of sources. From tax preparation software to online personal finance websites, it can be difficult to ensure a steady stream of clients.
Almost 40 percent of tax preparation firms are run by a single person while just a little over 50 percent have fewer than 10 employees. These individuals and small tax preparation firms face an even greater struggle since they do not have the budget to compete with the marketing methods used by many large tax firms.
While these facts may be discouraging to tax preparers—especially those who work on their own or for a small firm—there is good news for tax preparation professionals. The IRS estimates that by 2018, a whopping 250 million tax returns will be filed.
There are other reasons that tax preparers, or those considering going into the tax preparation business, should take heart.
- The Affordable Care Act (ACA) has created new revenue potential. New health care laws are causing many individual taxpayers and businesses to seek help from tax professionals to help them understand the complex rules and regulations associated with the ACA.
- Taxpayers typically use tax preparation firms located within close proximity to their homes. Further, once a taxpayer chooses a tax preparation firm, he or she tends to remain loyal to that individual or firm. In other words, once a tax preparation professional secures a client that client rarely leaves.
- The job market for tax professionals remains strong. More accounting students are getting jobs right out of school than ever before. More than 42,000 accounting graduates were hired by public accounting firms in 2014. Accounting jobs are expected to continue to grow at a rate higher than the growth expected for other occupations.
- Tax preparation has a high job satisfaction rating. Individuals who go into tax preparation usually do so because they enjoy working with numbers. This means that they are doing what they like to do each and every day. Tax preparers also meet a variety of people and have the satisfaction of helping individuals through what can often be a stressful process.
Tax preparation is a challenging industry and competition can be fierce. However, for those who are willing to make the commitment, it can be a satisfying and lucrative career choice.