Updated March 2025
Franchising offers entrepreneurs the chance to start a business with the backing of an established brand, providing a level of trust and credibility that can take years to build independently. This is particularly valuable in the tax preparation industry, where clients rely on experienced professionals to navigate complex regulations. With tax season approaching and the demand for tax services growing each year, investing in a tax preparation franchise is an attractive opportunity for those looking to enter a stable and essential industry.
What is a Tax Preparation Franchise?
A tax preparation franchise offers “tax return preparation services to individuals” and has “basic knowledge of tax law and filing requirements” (IBISWorld). Specific services include:
- Basic tax preparation – This covers straightforward tax returns with minimal deductions and credits.
- Standard tax preparation – This includes more complex situations, such as itemized deductions, multiple income sources, or basic self-employment income.
- Full-service tax preparation – This handles complex tax situations, including business ownership, multiple investments, rental properties, or international tax considerations.
- Tax-related financial products – These are additional services that include refund advance loans, prepaid debit cards for receiving tax refunds, or audit protection services.
Are Tax Preparation Services Seasonal?
“While the initial tax filing deadline is in April, tax preparers often continue to work with clients throughout the year on various tax-related matters, making tax preparation a year-round profession.” (TaxSlayer Pro)
The demand for tax services peaks during tax season, which in the U.S. typically runs from January through mid-April when individuals and businesses file their returns. The exceptions to this are extended deadlines and businesses that file quarterly.
While tax preparation is largely seasonal, many firms expand their offerings to maintain year-round revenue. This diversification allows tax preparation franchises to generate steady income outside of tax season, providing financial stability and business growth opportunities.
The Future of Tax Preparation Market
The tax preparation market size is “projected to grow over the next five years” despite economic challenges and competition from digital filing services. In fact, according to Precision Business Insights, the “Tax Preparation Services Market was valued at US$ 43,982.1 million in 2023 and is expected to grow at a CAGR of 5.9% from 2024 to 2030.” The same report explains that the “exponential growth in tax code complexity, with the U.S. tax code exceeding 70,000 pages, is a significant driver for the tax preparation services market across all segments.”
4 Advantages to Owning a Tax Preparation Franchise
Every industry has its benefits and challenges, but the tax preparation industry offers several unique advantages.
#1 – Low Overhead Costs
Because a tax preparation franchise is a service-based business with no inventory requirements, it typically operates with lower overhead costs.
#2 – Few Barriers to Entry
Most tax preparation franchises don’t require franchisees to be a Certified Public Accountant (CPA). Instead, they provide comprehensive training and support to ensure franchisees understand tax preparation processes and compliance requirements.
#3 – Provides an Essential Service
Professional tax preparation services continue to be essential services as tax codes grow “increasingly complex and subject to frequent changes” (Research and Markets).
#4 – Available Market Share
Not only is the tax preparation market size expected to grow, but the industry in the United States is characterized by a diverse range of service providers, leaving room in the market for smaller firms and franchises to compete.
Interested in Owning a Tax Preparation Franchise?
If you like working with people and numbers, then a tax preparation franchise is worth considering. Whether it’s tax preparation services or something else, reach out to FranNet to consider your options. Our expert franchise consultants will help match you with the right franchise opportunity while walking you through the process from start to finish – free of charge. Schedule your free consultation to get started!