Does anyone have experience with tax prep services?

October 08, 2023

by a searcher from Dartmouth College in Austin, TX, USA

I'm interested in this industry, but heard mixed things about owners of tax prep businesses being willing to sell to buyers without CPA/tax expertise (like myself).

Questions:

1. Has anyone managed to successfully execute a tax prep deal without tax expertise?
2. If so, how did you negotiate the lack of expertise? How are you operating the business post-acquisition?

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Replies

Reply by a searcher
from University of Denver in Boston, MA, USA

I've bought 3 firms as a non accountant. I think it's a great industry that's overlooked by searchers. There's big key man risk and technical risk in most firms for sale.....bottom line if you acquire a tax services firm you want to ensure there's 2 or more employees who sign tax returns that would stay on post close. Most of what's for sale has the owner signing every return.

Reply by an investor
from University of Texas at Austin in Houston, TX, USA

We have found that it is possible to both purchase and operate a business without a CPA background. The challenge is obviously that Management needs a deep background. Happy to discuss more.

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