If your goal is to grow your firm, there’s no time like the present to make it happen. Yes, it’s tax season, but it’s also no time for excuses. You need to decide, without a doubt, that you want to increase your revenue. This is the first of eight steps I share in the book, How to Build a Million Dollar Tax Representation Practice, detailed in the checklist below.
I have used these steps to grow my IRS representation practice to over $5 million, and they are the same ones used by the tax professionals who join The Tax Rep Network. I encourage you to use them, too, so you can have a firm that adds to the richness of your life in all areas, starting with your finances:
1. Identify what you want your practice to look like.
What do you envision as your dream practice? All tax representation, tax returns and compliance, or a mix of both? You can’t get to a destination if you do not pinpoint where you want to go up front.
2. Engineer your practice backward.
Once you know the destination, you can start planning what you need to do to get there. This starts with whether you want to keep your existing clients or find some new ones.
3. Determine the services you want to offer.
There are so many services that you can provide, so think about the ones your ideal clients really need and are willing to pay for. It is critical that you identify what it is you want to do and, more importantly, what you do NOT want to do.
4. Leverage technology.
Utilizing the right technology can help you reduce the hours you work and increase the profitability of your engagements. For instance, when I began automating the process of sending my engagement letters and checklists, along with a link to upload documents and the link to pay, we cut 30 minutes off the onboarding process for each new client. Given that we onboard 15 to 20 new clients a week, we are saving 7 to 10 hours of staff time every week, creating a significant bump to the bottom line.
5. Examine your existing practice.
If you have an existing practice that is not bringing you joy and profits, it’s time to decide what to do with it. In my opinion, do not just get rid of it. The big issue is deciding who you want to work with and making sure you are paid properly. My advice, if you are too busy during tax time, is to rank your clients and get rid of the ones that suck your soul and don’t pay you on time or what you are worth. Shed these clients and focus on bringing on better clients, ones who adopt your system and pay for their tax return when it is ready to be filed, not after it’s filed. You should not have receivables.
6. Find your ideal clients.
Clients are literally everywhere, and chances are you know a bunch of them who just have not shared the problems that you can help solve. The challenge is to make sure everyone knows how you can help them. This doesn’t mean spending a ton of money on marketing. Instead, adopt the mindset that marketing is not something you sometimes do or when you can find the time. It is a critical part of your business and must be done all the time.
7. Get appropriate training.
Whatever type of practice you want to have, ensure you have the appropriate training to be recognized as one of the best (if not the best) in your area of specialization. Make sure you have the training, skills, and resources necessary to do the job like a pro from start to finish. If you want to bill like a specialist, you must act like a specialist
8. Repeat after me: Discipline, not motivation.
Building a $1 million practice is not about being motivated. Motivation comes and goes. What it does take is discipline. This is what separates the successful from the dreamers. You must find it within yourself to plan the tasks you need to do and then execute the tasks every day.
If you are truly dedicated to reaching the million-dollar mark (and beyond) in your firm, you can’t wait for busy season to be over. Take action now. If you do, your only limit will be the one you choose to impose on yourself.
Editor's note: Looking to learn more from Eric Green about how to build a tax representation firm? Eric will be presenting several sessions related to tax representation at the Scaling New Heights conference in St. Louis on June 25 - 28, 2023.