Adding Revenue Streams to Your Tax Practice: 5 Ideas to Get Started

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We all want more revenue, right? Let me caveat – we all want more revenue without the headaches. In my travels and discussions with many tax practice owners, there is one trait that overwhelms – exhaustion. We are in a difficult and pressing industry that has seen lots of sensitivity to price. It is easy to forget that there are other ways to generate revenue that do not involve more hours! Here are a few ideas to get you started:

Technology Referrals

Do you know that most technology companies have partner programs? And those partner programs do not only give you discounts, you can in-fact get a revenue share, or a straight referral fee? Yes, the dollars are small, but I have to say that getting a few hundred extra dollars a month from telling my clients to use technology I love, is amazing. Ask all technology vendors that you work with if they have a referral program.

Referral Arrangements

Do you get leads or referrals for work outside the scope of what you do? I know many tax professionals that get referrals for bookkeeping services that they do not want to do in house. These are normally sent to bookkeepers without ever asking for anything in return. I recommend setting up agreements with whomever you want to refer work to. These agreements could be a flat fee, or a percentage of the gross profit. You can be flexible here! It is a way to capitalize on your great reputation.

Make sure to disclose to the prospect that you have a referral relationship in play when you send them to people. Additionally, if you are a CPA, make sure you are complying with the ethical code of conduct.

Outsourcing or White Labeling Services 

This idea is a bit more difficult to administer and can lead to great results. For a tax firm that does not offer bookkeeping work, but wants to, there are white labeled services to perform that work for you. You could use one of these services, mark up the price to your customer slightly to handle communication and administration, and add a whole extra service line!

Do you know your clients could benefit from a wealth manager’s perspective on their individual returns? There are wealth management groups that sell a service where they will review all of your individual clients’ returns and give you planning ideas (subject to client approval, of course). They monthly fees to be part of that network are relatively low and you can offer that to clients for a fee.

Many tax firms offer payroll services or human resources (HR) services as well. These services lines are almost always manned by an outsourced provider and require little involvement to keep going.

Specialty Tax Groups

If you are not focused primarily on R&D credits or cost segregation studies, it can be a big lift to perform those services. There are plenty of firms (you probably have a few emails from one in your spam box) that are willing to partner on specialty tax items. These partnerships can look like #2 or #3 above; sometimes it’s a referral fee and sometimes it is a white-labeled relationship.

Content

Small businesses and other firms alike are in desperate need of good training and good content. You likely teach your clients all sorts of tax topics on a regular basis and think nothing of it. You are an expert! Take a few minutes a week to record videos on basic tax topics (or write the key points and make your Gen-Z intern who loves being on camera record them). You can use these as client touch points, you can post them on YouTube, or you can even sell them through a Learning Management System (LMS) linked to your website. With YouTube, if you get to a certain following, you can get paid to have advertising with them. This is actually really difficult, and you have to be dedicated to quality topics and consistency. If you use an LMS, you could charge as little as $10 and still build a nice revenue stream for yourself. Remember, you have a ton of knowledge that people are willing to pay you for – even if they are not ready to hire a tax accountant.

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Liz Mason is a serial entrepreneur, a giant nerd, and an involved accounting vanguard. She is the Founder of High Rock Accounting, Rebel Rock Accounting, TheDepartment.Tax, and a few other related brands. Liz speaks on a national stage, guests stars on podcasts, publishes a YouTube show (The Hot Accounts), and writes frequently. To further her passion for the advancement of the accounting profession, Liz currently serves as a Xero National Ambassador and as the Content Strategist for Tax Practice News. Liz started her career in tax at Grant Thornton (at 20) and automated a portion of her job landing her in the national tax practice. She spent a decade in large public accounting firms working on highly technical tax consulting before branching off on her own. Liz utilizes her creativity and passion at her company to uproot traditional practices and replace them with innovative concepts. She finds joy in efficient technology and her core belief is that everyone and everything can continuously improve (she says "be better" too often). When Liz isn't planning world domination in accounting, she is a die-hard skier, down for any adventure, plays the ukulele, reads everything, and has a good sense of humor. If you're looking for her, you can find her traveling the world and enjoying new food and cultures with her husband and young son. Follow Liz and High Rock Accounting on Twitter at @LizzyNorMa and @HighRockCPAs.