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How Tax Franchises Can Pay Off Big

There has never been a better time to start a tax franchise in the United States.  As the old saying goes, the only thing guaranteed in life is death and taxes.  This type of business is recession proof.

What is a Tax Franchise?

The bread and butter function of a tax franchise is tax preparation.  However, there are many more services a tax franchise can offer, such as loans, bookkeeping, credit repair and tax debt resolution.  In many cases, the customers will make the first contact with the tax franchise business during tax season and then decide to continue with other services once tax season is over.  Examples of tax franchises are Liberty Tax, H&R Block and Jackson Hewitt Tax Service.

Benefits of Tax Franchises

One of the biggest benefits of starting a tax franchise is it is easy to do!  Tax franchises can be started without a big office or a giant IT network.  You do not have to be a college graduate, be good in math, or have a CPA background to start a tax franchise business.

Tax franchises can be very lucrative.  Many tax franchise owners make between $30,000 -$100,000 in 90 days or less and some do it while working from home or being mobile.  Some people opt to operate their tax franchise as a side-hustle while others run their business as their main source of income.

Additional benefits of owning a tax franchise include:

  • Cutting-edge technology - Most tax franchises offer advanced technology which allows the business to be ran anywhere, anytime.
  • Full-service support – Tax franchisors fully support their franchisees to help grow their business with training, IT, operations and more.
  • Dedicated marketing – The marketing department of tax franchises provides state of the art national and local campaigns, support and collateral to help their franchises build their business.
  • Multiple revenue streams – In addition to tax preparation services, tax franchises offer consumer lending, bookkeeping, credit repair and tax debt resolution.

Cost to Open and Operate a Tax Franchise

To give you an idea of how much it cost to open and operate a tax franchise, we took a look at Liberty Tax franchise.  Here is a breakdown of the fees for Liberty Tax:

  • Total capital investment - The total capital investment necessary to begin the operation of a Liberty Tax franchise is $65,000 to $80,000.
  • Franchise fee – The initial franchise fee for a new Liberty Tax territory is $40,000. For existing territories that are resold, the cost will vary depending upon the gross receipts of the territory and other pertinent market and economic factors.
  • Ongoing franchise fees – Liberty Tax franchisees are required to pay the franchisor a royalty fee of 14% of gross revenue and 5% of gross revenue for advertising.

Additional Liberty Tax franchise information

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