Discussion:New Practioner - some questions

I've recently started my own CPA practice in South Florida. I've worked for CPA firms for about a dozen years doing audit and tax work. It has been SO hard to get clients! It is just so competitive. To get clients I've been charging very low fees, and advertising on free classified sites.

The clients just can't believe the service they are getting and the knowledge I have for what they are paying, the thing is I really would like the higher end clients where I can charge decent fees - but how?

I've been doing 1040's for $100, but after seeing what HR Block etc is charging (based on this forum) I am charging way too low. Some should probably be more like $250 at least. I've been doing S Corps for $350, but they were pretty simple ones (for me), but established practioners charge at least $600.

I got a not for profit audit I did for half the price of the prior auditor and did an awesome job...(seriously), the CEO was amazed.

I am worried I might not get enough clients tax season to even make it and have to go back to work for someone else - which is not what I want to do.

I'm very good at what I do - technically, but I'm not such a good salesman.

What if I end up getting more clients and charge them higher prices, what do I do with the clients I have that I am charging really low rates to?

Also I've been looking to purchase an existing accounting practice - but cannot find any for sale near me, I figure that would give me a good start. I am thinking of contacting other local CPA firms and asking if they want to divest of any clientele, I would purchase them based on cash receipts, but not sure how much to pay for them?

What do I do?????

Thanks everyone!

Go to your local library and get a book called "The Referral of a Lifetime" by Tim Templeton; the story is a bit corny but it has a great message- and as a non-salesesperson you will get a lot out of it. To quote a phrase from the book, it sounds like you have been successful but are now "on the shelf". You need to get off the shelf!

Also you need to get into the mindset that you would rather do 50 $250 tax returns instead of 100 $125 tax returns. Don't worry about dropping your less profitable clients as you get busier- hey, you have to put food on the table!

Keep us posted with how it's going!!!

Pete

The best thing you can do is sit down & make a written marketing plan for the next 6-12 months. Create a budget & put the plan in place so you don't have to stop every omnth or slow period & figure out how to market. When you get busier it's easy to let the marketing slip & then by the time you notice the slow down there's a lag between getting busy again. Consistancy, especially in the first year or two, is the key. I'm a terrible "sales person" but have covered that up with a decent marketing plan. Good luck- Barry

Did you offer to purchase any of their clients? I am thinking of offering to purchase clients other CPA firms may no longer want - could be not enough profitability, not in their niche, or just hellish. Thinking 10% a year of cash receipts for these clients so long as I have the client.

Do you offer a referral fee for referred clients?

Thanks

I also do not have a set referral fee. I always send a card if the potential client turns into a real one. I have sent $25 gift cards to a few people that either have sent numerous clients or sent someone that turned into a larger dollar client.

I started my own practice a little less than a year ago. My fees were way too low my first tax season and I got some clients I did not want. I’ve also picked up a couple of monthly clients that require too much work for the fee that I am charging. Only in the last couple of months have I been able to pick up some quality clients. There is nothing worse than giving a quote to someone and hearing “oh, that’s cheap!” And I’ve heard it at least a few times. I have a real problem with always under pricing myself and I’m working hard to change that.

Here is what I have done as far as marketing goes.

-I joined the local chamber of commerce. I attend networking meetings several times a week. The first couple of months it didn’t feel like it was paying off, but once people started getting to know me I started getting some business from the people I met and some gave referrals as well.

-If I meet a financial advisor, commercial banker or a small business attorney, I have lunch with them and tell them about the services I offer. I’ve gotten several referrals from these individuals.

-I write a weekly newsletter and send it to all of my contacts. It’s a short little letter that normally includes a tax or accounting joke to get people interested, then some tax saving tips. I use constant contact for this. It’s pretty cheap and easy to use. I believe you can try it out for free for 60 days.

-I try to give as many referrals as possible.

-I give my clients the best service possible.

-I also met another CPA that’s been in business for a while. He offered to give me some of his 1040 work during the tax season. We haven’t discussed the details yet, but I’m hoping something will come out of that.

I’m thinking about doing some kind of a seminar for small business owners. It will probably be about 3 hours, provide some information that they can benefit from and at the same time I’ll be able to tell them how I can help their business. Has anyone done anything like this?

That's all I can think of right now.

Vanja

Has anyone had any success blogging or writing a column for small local newspapers?

I am not so sure CPA's around here will just give me clients they do not want, but I am sure they will refer them to me for say 10% cash reciepts if they don't want them, some might be nice enough just to do the referral. Entire practices usually sell at 1.15 gross (average) and I have heard of people selling for 25% per year of cash reciepts for 5 years. Maybe I will offer something like 15% for 5 years if any firm wants to divest of current clientele.

I'll write a letter stating I would offer a reasonable price for these clientele, I am sure I'd get some responses.

Vanja: You really have the network thing going on well - I think you will do ok. Do you meet other types of professionals for lunch one by one or do it as a group?

I tried the seminar thing - wrote letters to about 50 not for profits. About 10 came back as undeliverable. None of the others responded. The newspaper article is a good idea, everyone likes personal finance and tax tips, especially the little unknown ones (usually 2% AGI misc ded types).

One approach for tax season I am going to do is postcard direct marketing. There are some internet services that allow you to design or upload a postcard and then mass mail them to a given area/zip code, to residences. I did some reading on direct mail and one tax prep place (I HATE THOSE PLACES - they are idiots, they should be illegal or regulated) put a coupon ($23 off or so) on the postcard and it brough in a lot of clients. I think the typical blue collar client wants a refund ancipation loan - a lot of the tax software now offers this in conjunction with banks...I will do that. Money is money this year.

Just not sure if I should put the CPA firm name or use a DBA. The CPA name may scare this target market, I may need to just use a DBA and call it "Speedy Refund" or some crap - some gimmick, then put it on the door.

The answer probably varies by state but can a CPA open "Speedy Refund" with no mention of CPA and not register the firm name with the state board?

I am not sure what THOSE PLACES are but they can't be complete idiots if you are copying their marketing plan.

Also included in THOSE PLACES are HR Block, Jackson Hewitt, Liberty Tax and other tax franchises.

I do not think they should be allowed to prepare anything except the most trivial of taxes, they are a disservice to the public.

My CPA firm is registered with the State Board, I see no reason why I cannot register it with the State under a DBA.

Simply because I feel they are incompetent theives does not mean they are not marketing correctly.

Got it there Jimbo?

I personally am not a fan of either one, but I did lose a few clients that contacted me this year because I did not offer them. At this point I have a fairly new practice and need to get as many new clients as possible. I have no intention of marketing that I offer these bank products, but if someone really needs it I will have the option available instead of losing a client.

I am set-up to take credit cards and I have a credit card terminal that reads checks as well, so I will always ask clients for a check or credit card before even mentioning the other options. And I have no intention of charging ridiculous fees for these bank products.

I have a friend from college with a 3-4 yeard old practice that did say postcards worked well when he offered a discount. I plan to send out 2,000-3,000 next tax season.

Can you please tell us something about the postcards your friend sends... what size? (4x6cards are cheaper than 8.5x5.5) in general, what is the content? is his picture on the card? how much of a discount is he offering? what is the selection criteria for the mailing lists?

The New Tax Guy

What city are you in (if I may ask)? I am thinking of sending postcards to different areas and see what happens, probably 500 per area (by zip code I guess). If I get good results I'll send a lot. What service do you use for CC & Check processing?

I really don't want to lose potential clients to the crap places either...I mean really, a typical 1040 is 15 minutes at most, easy money, and from what I've read I charge less than the morons at *THOSE PLACES*!! :) I asked an old friend of mine who isn't all that bright who does their taxes, his answer "I got people", I almost smacked him.

Jimi Didn't mean to be harsh on you, I see you're a CPA - you must feel some anger towards these places also, am I incorrect? Also the spelling of your state is California, not Califronia (check your profile) - just helping, I type fast too and make stupid errors.

This profession needs to defend it's best interests. We let the lower end clients go to services where the employees are lucky if they can spell their names, much less understand anything beyond what to input on the computer screen, and give away billions in payroll services to places like Paychex and ADP in exchange for a Master Tax Guide or 2(gee thanks).

We have to pass an exam harder than the bar, we have immense liability for what we do, and accountant-client privledge is no-where near as good as attorney client privledge. We compete with each other on price to the point where no-one makes the living they should - law firms tend to not bend prices like we do.

The other day some deadbeat lawyer told me over some drinks that he thought the average CPA was no better than HR Block and we just give the impression to people that we protect them etc.. What an idiot...if he only knew. Then he got to asking me about distributions from his Roth (should have told him to ask one of the Clowns flagging people at Liberty Tax :) ).

This profession needs a perception makeover, but that is another topic.

Maybe I am a masochist to have gotten into this years ago.

I read your post about a week ago and thought about it. It reminds me of when I lived on Long Island and tried to start a practice. I was 30 years old and had tremendous difficulty building the practice. After 4 years I gave up and moved to NC. When I started my practice in NC I vowed to not make the mistakes I made on LI. I worked for 2 different sole practitioners in this 4 year period. What I learned from them was immeasurable and I use it today and thank them every day in my thoughts. I would , if I were you, find a per diem gig with a small firm where you can surround yourself with good people while you build your firm. Here are some thoughts that I hope are helpful. Just my opinion and of course open for debate and meant to be helpful I would stay away from marketing to those that would use HR Block. You are a CPA, set a minimum rate and market to those that need MORE than BLOCK. In 1997, I set the minimum at $250 and it is now $500. I have more work than I can handle and turn away a lot. Set a minimum at $225 or so. My BEST clients have come from LARGE firms where they got NO service. Take from those above you not those below you. Your thought on “it takes 15 minutes” while it may be correct, will in my view assure that solid clients will not come to you. They will sense this. For example, I use an engagement letter for all clients, we double check all returns, use a control log for E file, etc….. I CAN do them in 15 minutes BUT market to the client that expects more. Let them believe that you spent 2 to 3 hours on it. While difficult, I believe you should have an office and not work from home. I mean NO disrespect to the many excellent practitioners working from home. I advertise blatantly our file security. All PDF’s are password protected, our server is data encrypted, our file cabinets are all locking cabinets etc…. we use a local shredding company and all is on our web site. I market myself to professionals and business owners. My market is a business doing in excess of 500K and generally less than 5 mil. I do no retail. What’s interesting is that many clients ask me if I want a referral because they know I am selective. It has worked to bring more business. I speak annually at the local financial planning conference. I spend about 20 hours working on a topic for investors and financial advisors. The referrals have been tremendous. The average return is $650 to 700 from financial advisors. The trick is , they think I am an expert and I let them. For example, I gave them an example of how a large capital gain at 15 percent increases fed tax by about 19 percent because of its effect on AGI, phaseouts, social security etc…. that alone started a 10 minute discussion that made me look smart. We all know, it’s pretty simple stuff. I like the post card idea, BUT know your market. Your client should/ might be the professional earning between 75K and 300K , possible vacation home, kids, rental property etc…. Try “ The CPA for those who need more than a store front”. “For about $20 to $50 more than BLOCK you can have a year round professional.”

Develop a web site, make it razor sharp in what you do. I personally believe the narrower the better but this is debatable. I like cpa site solutions…. But there are many. On your site, it should state exactly who you are, what you do etc… Get a logo and a “jingle” similar to that above. “Need more than a storefront”

I hope one or two of these are helpful.

I read a book called "Walk like Giant, sell like a madman" It is out of print BUT try amazon. GREAT book, takes an hour to read. Chnaged my life.

The part I have a difficult time with is setting higher prices even though I will be raising them next year. I know last year I did some returns for $120 that even H&R Block would have charged over $200 for. Any my prices for 1120s were too embarrasing to mention. However, because my 1120s and bookkeeping prices were so low, I got 3 clients with S Corps that hadn't cleaned up books or filed corporate/personal taxes in 3 years, which generated a lot of revenue. Around here it seems everyone is losing their house and/or their job (okay not everyone but many people) and price means a lot to them right now. I am afraid to be known as the low price place to go, but at the same time I need the clients.

I was my impression, from discussions in other areas, that CPAs are not allowed to pay or receive "referral fees."

Floridacpa –I usually attend group networking meetings, and then invite individuals to have a one on one meeting (lunch, coffee or just an office visit).

I sent out some postcards last year. I concentrated on new homeowners, offered $20 discount. I sent 1500, about 5% came back and I only got 2 responses. One of those was an older couple who has lived at their home for more than 30 years. I purchased the list from directmail.com.

I wasn’t a CPA yet last tax season. I offered RAL’s. I applied late (sometime in December) and got approved through Chase. I also accept credit cards and checks and give my clients an option to pay upfront instead of using the bank product. Some are not interested at all in waiting for their refund and don’t mind paying the bank fees. I charged $30 extra on my end for completing the RAL application.

Here's just one I found by searching this site for "jokes humor funny". There are more threads (some most probably not suitable for your newsletter !), but you'll find some interesting stuff here; you'll laugh - even if you can't use it for John Q. Public - and you'll get to know some of the characters around here a bit better.

Discussion:Discoveries (Some humor to brighten your day)

PS - Welcome to TA

That is amazing advice. Thank you.

AICPA ET Section 503

Try to pick some offbeat field that's profitable, and it's even better if they have some statewide magazine or circular that you could advertise in.

Whatever you do, don't go after lawyers and doctors. Both are crazy. Stay away from dentists, unless you have good teeth (bad teeth is money to a dentist, you see).

Pick some oddball field that the rich are dabbling in, or are connected with. Let's see, the rich folks live on lakes. You're down in Florida, why don't you go after those people that catch alligators? The Critter Catchers? Keep in mind, when they are needed, they are really needed, and from what I see on TV, a lot of local governments keep them on retainer. That should keep you busy.

From the critter catchers, you find out where they buy their traps and snares, and you go after those people as clients, and take it right up the food chain. What about the people that process gator meat? We all know they don't really release those alligators back to the wild: get them as clients too.

P.S. Of course, it's crossed my mind that these Critter Catchers are picking up a gator at one residential lake, and letting it loose in other residential lake in the middle of the night, only to get paid for picking it up again. Which is a hell of a business if you think about it. You can retire rich with one alligator and a truck.

I've done some investigation on your question regarding the legality of referral fees. It would seem that each state has it's own laws.

This is the Rules for Florida

61H1-21.003 Commission or Referral Fees

(1) A CPA shall not pay or accept a commission or referral fee in connection with the sale of a product or referral of any services as defined in Section 473.302(7)(a), F.S. or prohibited to non-CPAs as listed in Section 473.322, F.S. These services include: (a) Audit, review or compilation services. (b) Services for any prospective financial data including forecasts or projections. (c) Any special procedures engagement resulting in an expression of an opinion when the services fall within the definitions as set forth in Section 473.302(7)(a) and Section 473.322, F.S. (2) The CPA must have an engagement letter signed by the client prior to beginning any engagement for which the CPA will receive a commission. The letter must include complete details of the financial arrangements involving compensation for the services rendered. (3) The CPA must hold appropriate licenses as required. (4) If the CPA is not independent as described in 61H1-21.001, F.A.C., it must be disclosed in the engagement letter. However, if the only reason for not being independent is the fact that the Certified Public Accountant is being compensated by a commission or contingent fee then the lack of independence does not have to be disclosed.

It would seem so long as one does not pay a referral fee for attest, assurance or financial statement preparation work, it is acceptable. I will check with the state board to make sure.

CrowJD - That is excellent advice. Maybe I'll buy a truck and an alligator and move to Florida. By the way, one of my clients is an attorney. Boy, is he an interesting character. He hasn’t paid any taxes or filed returns for three years. He wanted me to come in, clean up his books and get him all caught up. It turns out he had tax returns prepared by his prior CPA ready to be signed and mailed, he never mailed them. I got him up to date and suggested he files his past due tax returns as soon as possible. It’s been a few months, still nothing. At least he paid for my work. I don't have any doctors yet, but I did have a meeting with one the other day. I'm not really sure he knows what he's after but as soon as I walked in he made sure to tell me that he's been doing his own accounting for longer than I've been alive, pretty much implying that I can't possibly know more than he does. I'm not sure why he called me in the first place.

Off topic, does anyone know if there is a way to get notified via email when a reply is posted to a thread? I checked the box on the bottom that says "watch this discussion", but I’m not sure what exactly that does.

One thing about the doctors and lawyers, though.

A lawyer will tell you he knows something he doesn't know a thing about, but HE knows he doesn't know it.

A doctor will tell you something he doesn't know a thing about, but he actually and truly believes he knows it.

Both display a type of psychosis that is highly resistent to treatment! Generally and metaphysically speaking, you can't help them. Concretely, you can advance them a step at a time (which I don't have the patience for).

The best way to handle these mental cases is to make good use of your time and see who they use as vendors. For instance, pay attention to the courier service or court reporting service, etc. that the lawyer uses. These are potential clients. With the doctor, who are his local vendors? Jot those down.

Let's say you come across a court reporter. You call and you say..."Look, I do the books for Joe Lawyer over here, and I can get you paid 15 days earlier if you'll use me as your CPA" And you take it from there. STOP, no that's dishonest, don't do that. Silly me.

But, by looking over the vendors, it does give you an idea of the TYPES of businesses that are doing well that you may never have considered as clients. The key to small business is finding those offbeat, niche areas, and "owning" them.

I am curious about how your advertising on free classified sites works. Which sites are you using? What kind of content do you post? What kind of clients do you get. I have done a little of this on Craigslist and all it has gotten me is some junk mail.

When my wife started our firm in 2001 we charged rates that were way too low; way too low. She was working out of our house and it was her first time wtih her own business. We have had a hard time raising our rates to match our competitors; however, this also allowed us to grow our revenues by an average of 40.5% per year for the prior six years and we will likely grow them 20% this year. We have been raising our rates; however, it is difficult. Next year we will be charging about 70% of the large National tax preparers...

We do NOT do RAL's at all. I just do not beleive in them and hence we do not offer them. We have lost 2-3 clients over this; however, I would rather lose a few clients then offer a product I do not beleive in.

Mike

I really liked your response. I thought it was excellent and provided a lot of good advice. Except for working for someone else at per diem rates it very much reflects how we have grown our business.

I am also a Dave Ramsey ELP; it has been a good experience!

I do not know much about Frank Salman's program.

Mike

You asked about postcards and I would like to throw my two cents in. There are several other posts about direct mail advertising that you may want to read in this forum.

I spend a lot of money on direct mail. Direct mail works for me. I have tried several types of direct mail and my experience has been that one page letters work best for me and that postcards have not worked for me at all. I often have a business card inserted with the letter.

There has been a lot of discussion about this on this forum and it seems that some people (Maybe a majority) have had better luck with postcards and some have had better luck with letters. I have to think it depends on your target audience and the quality of the postcards and letters.

I am really "anal" about advertising. I track every new client and every phone call I receive throughout the year. I maintain a spreadsheet and color code it based on whether they came on board, might come on board, or did not come on board. I think this is the key; if you do not do this you will never know what advertising worked and what advertising did not. Last year I spent $21,676 on advertising; of this amount last year I spent $13,356 (61.6%) was spent on direct mail (letters).

On this forum (and many direct marketing professionals) many people have said that you will get a response rate of 1% to a good direct mail piece. Occasionally I have seen people say that they get a response rate of 2-3%. I have NEVER got a response rate like this. This year so far my response rate has been .2%. Of the 25,610 letters I sent out I got 56 phone calls. Of those 56 calls 22 have come on board as clients. The key is these new clients are mostly businesses; not individuals.

In 2008 I advertised to new home owners. The payback on this mailing was 1.95:1, in other words if I spent $100 I generated $195 in revenue during that year. The problem is MANY of these clients did not come back...

In both 2008 and 2009 I advertised to existing business owners and to new business owners. In 2008 my payback was 4.96:1 and this year to date it is 4.27:1 for new business owners. Last year it was 4.84:1 for existing business owners and this year only 2.38:1 for existing business owners. I attribute the drop off to the economy...

I hope this helps.

Mike

I would like to know more about the postcard response rates. Often people have told me they get a response rate of 2.5%; however, I have never been able to duplicate that kind of response rate.

Mike

Your response was also excellent. I get some clients that use the large national tax preparation firms; however, I do not purposefully advertise to that market.

I like your idea of setting a minimum fee per client. This is not something we have done; however, I could see it working well...

I also like your idea of targetinging businesses with at least half a million dollars of revenue per year; however, a lot of my small business owners have revenues a lot smaller than that.

Mike

Most of my new clients this year came from Craig's list, referrals, and Google.

I tried Craigslist and it was a complete waste of my time.

What did you post on Craigslist, in what section did you post, and what kind of clients did you get?

Mike

Can you tell me more about your email marketing campaign?

Do you use an opt-in list?

Has it generated new clients?

Mike

For businesses I offered bookkeeping, Quickbooks cleanup, income tax preparation and payroll taxes. I also listed my base prices for this. And I mentioned I had an undergraduate and graduate degree in accounting along with several years of experience.

I got four new bookkeeping and payroll clients out of this along with 1120S and personal tax preparation. Some of them also had prior issues I took care of. Initially they contacted me about the taxes and I was able to convince them to sign up for monthly services. I also got 2 S corps that only wanted the 1120s, no bookkeeping and I think 6-7 individuals.

So far they have all been good, with the exception of one S corp that I quoted a price to over the phone and it ended up being a lot more work than they said, so I worked very cheaply on that one. But they do contact me throughout the year with questions and to update me on things they're doing, like buying a rental property. So I'm pretty sure they'll come back next year and I will be raising their fee.

As I mentioned before I use constant contact to send out a weekly newsletter. It's not very long, just a couple of articles with useful tax planning or money saving tips. I only send it to people I have actually met. I go to networking events, collect business cards and enter them into my database. The following week, they start receiving my newsletter. They have an option to opt out, and so far about 1% chose to do so. It's kind of hard for me to tell if some of the clients that came on board did so because of the newsletter or if they would have done so anyway. However, when people see me they always mention my newsletter and how much they enjoy it. And every now and then I get a response to one of the emails saying something like "thanks for the tips, by the way I have an issue can you help me" and then the next thing you know they are a client. I believe in it 100%. All these people that I meet at networking events may or may not remember me in a few months when tax time comes if they only saw me once or twice. But if they keep seeing my name and picture in their mailbox on a weekly basis, then the chances that they'll pick up a phone and call when they are ready to move forward are much higher.

They are unaware they have a subconscious bias.

They price based on what the work is worth to them.

They are so experienced with the area of expertise they place a low value on their product/service. After all they understand it! It’s a common mental hurdle.

All that matters is the value as perceived by the client. Taxes are a scary black box to most people. Smart people value professional advice and they will pay for it. If not, you don’t want them as clients anyway. One shortcut is to figure out what it’s worth to you, realize you have a bias, and double the price.

Tip #1: Never Go Anywhere Without Business Cards. Talk to one person everywhere you go and give them your 45 second pitch (see #2 below) and a business card. If they show the slightest interest, get their contact info. (That means you always have a small notebook and pen with you.) That means you never leave the supermarket without talking to at least one person.

Tip #2 Tell Them How You’re Different. Otherwise you blend in with every other accountant. Example: I had a friend who had a dog walking business. She loved poodles. I had her reprint her flyers/cards/advertising adding ‘Poodle Specialist’ and in smaller letters, ‘Other Breeds Accepted’. People would think, ‘I need someone to take care of my dog. Let’s see there’s several. Oh yes there’s that poodle specialist’. If they have a poodle they go to her. If not, they still go to her because she stands out in their mind. The other 6 dog walkers they’ve run across just blend together.

Tip #3 Ask Them To Come To Your Office. I suggest a free 20min consultation for pricing. Step one is not convincing them that you should do their taxes. Step one is to get them into your office.

Tip #4 Tell Them The Value You Will Deliver And Afterwards Tell Them The Value You Did Deliver. Don’t make them guess if they saved money or stayed out of trouble. “I was able to get rid of the 10% penalty on your IRA distribution because I…..” “Many accounts miss (issue XYZ), but I caught it and you saved this amount of $$$.” (Then give them the bill. It will seem like a bargain.)

Enough for now.

Oops! This is all second nature to me. I priced it to low. I gave it away for FREE!

I think if your tax office is out in the country somewheres, you could still get by with doing this. It really brings in the customers. Of course, as I've said many times before, nothing beats a hotdog roast on a Saturday for bringing in the new customers. I'll give you a tip: put some streamers up. Talk to your grocery store manager and he can make you a deal on some expired weenies. It's always been my motto that as long as the bun is fresh, the customer could care less about the weenie. (If the bun's not fresh, it takes a much bigger weenie to make an impression).

I put an ad on Craigslist and it definitely gets me clients, some good, some ehh and lots of spam. I decided not to do RAL's, if someone needs the money that bad, let them go to you know who! Wouldn't mind eventually doing the Dave Ramsey ELP, but I know at least one about 15 miles from me - isn't that a program where there is one per area/radius?

Did you write your own direct mail letter or buy it from a marketing firm? Any chance I can check it out (Given 2000 miles of distance, I will not be competing with you for business!!!!!)

Bbowers - Frank Salmans program is cheap enough on his website - I mean $89, what is the focus of it?

Vanja - Do you make the newsletter yourself or buy it? Can you recommend a good one?

Zip 2001 - You are sooo right, I was thinking about that just the other day - for me lots of this is simple or I just do a little research - some things are difficult, no doubt. So I might say what the heck, and charge something low - meanwhile I could get more. The problem is there is always someone out there charging less - I tell people I give the best value , and I do believe that.

CrowJD - man, that is just wrong (but I am laughing anyway) :)

In general - I'd love to get a hold of the pricing that H&R, Liberty and Jackson Hewitt have - I've seen different postings here stating average 1040 is about $200 etc.. I just want to be able to set a minimum price and add $X per schedule ... that could work. Still trying to figure how much to charge for 1041s, and not for profits. $350 to $450 seems to work for S Corps - small businesses. Although from now on for businesses - I require a consultation, and to see last years return!

I find I really need to find out what people have on their returns when they call - I did one for $100 where they had 3 W2's, 2106, Sch A, dependent care etc.. I thought to myself - IDIOT! But the client never used an accountant, was using turbo tax, and I didn't ask too much. It was a quick conversation and when she asked how much I figured - "aha a turbo tax user, she won't want to spend much, probably can't afford it" - so I said around $100. Only good part is she is coming back for 2009 and referring me to some family, and some business contacts, stranger things have happened!!!!! So I am thinking, maybe it is good not to charge much for a 1040, as a "loss leader"?

In one of my emails from Intuit they had a link to a decent direct mail letter for new businesses. I will try to find it and post it on here. As far as newsletters, check out clientwhys.com, taxnewsandtips.com, tenenz.com, and newkirk.com if you're looking for one to buy. Also, if you get a website from clientwhys.com or CPA Site Solutions, you can get a newsletter posted on your web site and emailed to subscribers for free.

As far as pricing from the big chains, I have found from looking at clients' prior year returns that Libery Tax is the cheapest, H&R Block is next, and Jackson Hewitt seems to charge the most, at least around here. I know someone with a Liberty Tax franchise in Florida who said his first year the average was $120 but he did a lot of returns at a discount and/or for free. I had someone come in with a 1040A, married couple with no dependents, one form (don't remember which one), 3 W2s and they paid H&R Block $110. A married couple with a 1040 with Schedule A, no dependents, no other forms, 2-3 W2s, one 1099-INT paid $175.

Christine

Florida Taxes - Thanks for the list of newsletters, I'll have to look into those. I've been thinking about getting a website with CPA Site Solutions for a while now. I designed my own website, and make changes on my own. It's pretty simple but looks fairly nice. I only pay hosting to Godaddy which is really cheap. However, I may take the plunge and go with CPA Site Solutions since they have some neat features.

I had a client last tax season that brought in his last year’s 1040 with Sch C, about 8-10 1099-MISC, a couple of depreciation schedules - paid $399 to H&R Block.

Zip2001 - you are so right about pricing yourself low because you base the fee on how complicated you think the issue is. This happens to me all the time and I'm still learning to stay away from it. I think "oh well that's easy", while the client may think it's the most complicated thing in the world. I think I'm going to implement the "minimum fee" this upcoming tax season. I have a couple of bookkeeping clients that I took on early on in my practice, I just wanted some clients and they couldn't afford to pay much. After doing all the backup work for them, I’m still waiting to collect payment. It's just not worth it.

Please note the name change - Vanja83 is now VanjaCPA. VanjaCPA 10:51, 29 September 2009 (CDT)

If you are sending postcards, my 2 cents is that you should NOT follow with a call.

I NEVER call a prospect. It puts you in a position of weakness. How would you feel if an attorney called you? That said, firms that do this a re volume oriented. I still say you should separate yourself as a BRAND not a servce.

VANJA

I went with CPA site solutions after doing it myself just like you, like it a lot. The fee is a bit stiff but the portal. free newsletters, etc..... I am very happy with it.

Also, ask more questions of the potential clients. That's one thing I failed to do in the tax area, and I always regretted not asking enough questions. You get hit with a multi-state mess after you've already quoted your fee, and you learn fast.

Look at it this way, you know you are going to make a killing on the simple returns, so make sure you don't get killed on the complex ones.

There was some business I got that I wish I had not even heard of! One thing I should have remembered from law is that first few clients you get are always going to be terrible, so if you do luck up and get a good one, thank your lucky stars. Anything you can do by asking questions to improve your odds of getting a good client is worth the effort. Pawn off the lemons on someone else if you can.

10 prospects a week.

Why not. If I were starting out, I might make a follow up call.

Please let us know how it turns out.

Southparkcpa - Do you get any kind of tracking/report options for the newsletter that is sent out through CPA Site Solutions? I'm using constant contact and it's really neat to be able to see who opened it, how many times, who clicked on links and things like those.

Newsletter tracking. No not yet. I just swithched to Site solutions and am "playing with " the accounting portal for clients to pick up and send documents securely, attach workpapers for schedule C and E and put a generic organizer on the web site.

I do not track the newsletter yet nor do I plan to. I do NOT think the newsletter is mailed via Site solutions it is avalable for client download. I have a realtively well established practice so I don't monitor this any longer but I see your point clearly.

Funny but I still send a HARD mailer every January as a tax season reminder/prep letter.

The $519 fee in my mind is only slightly low in theory. A small C, with some basic stuff can generate ALL of thos forms (except the 8903 of course). In my office that could be as low as $550 or much higher.

I would be happy to send you a copy Florida CPA. Just send me an email at Mike@SBSCPAGroup.com.

Mike

I just use Direct mail, I never follow up with a phone call. I absolutely detest it when people call me; so...

Mike