How much is the yearly income earned from the tax preparation industry?
Starting a tax preparation business can be a great idea if you want to be an entrepreneur. The amount of money you make will depend on both your market and on how good you are at attracting new clients.
There are actually two "Peak Filing Seasons". The first "Peak Filing Season" begins the second week of January and continues through the third to the last week of February, when taxpayers who are getting tax refunds file their tax returns. The second "Peak Filing Season" begins late in March (usually the last week) and continues until the tax filing deadline, April 15th. These are the two busiest periods for tax preparation business and therefore the most profitable periods of time for you to be preparing taxes. This is when you will make the most money.
According to the Occupational Employment and Wage report for May 2017 (released on March
30, 2018), issued by the U.S. Bureau of Labor Statistics, the national mean wage estimates for tax preparers is $22.64 per hour, $47,090 annually. The bottom ten percent of tax preparers earned $9.70 per hour, $20,170 annually. The top ten percent of tax preparers earned $39.30 per hour, $81,740 annually.
Successful independent tax preparers, operating their own tax preparation businesses, can make substantially more money than a tax preparer who is an employee. Many independent tax preparers earn $100,000 or more per tax season.
If you are a knowledgeable tax preparer with excellent marketing skills, you can make substantially more than that. Of course, you can also make much less than that too. It all depends on you. You should be prepared to give your budding business your full focus for at least three tax seasons in order to build a solid client base and begin to see a substantial income. Many successful tax preparers launch their tax preparation businesses part-time for three or more years, only going full-time once their tax preparation business was fully up and running.