Business Overview

• The owner is an EA
• This practice was established in 2004
• Software in use is Lacerte
• Approximately 207 individual tax returns with average fee of $1,154 per return
• Approximately 34 business tax returns with average fee of $1,875 per return
• Approximately 28 other tax returns with average fee of $1,363 per return
• Approximately $12,325 in revenue generated from tax consulting.
• Annual cash flow including owner’s salary and benefits, personal vehicles, and any other non-operational expenses of the business: $268,120 (2021)
• Lease expires on N/A. Virtual Tax Practice


  • Asking Price: $520,000
  • Cash Flow: $268,120
  • Gross Revenue: $370,000
  • FF&E: N/A
  • Inventory: N/A
  • Inventory Included: N/A
  • Established: N/A

Why is the Current Owner Selling The Business?

There are all sorts of reasons individuals decide to sell operating businesses. Nonetheless, the true reason vs the one they say to you may be 2 completely different things. As an example, they may state "I have too many other obligations" or "I am retiring". For many sellers, these reasons are valid. However, for some, these may just be reasons to try to hide the reality of altering demographics, increased competitors, recent decrease in profits, or a variety of other factors. This is why it is extremely crucial that you not rely absolutely on a vendor's word, yet instead, utilize the vendor's answer together with your overall due diligence. This will paint a much more realistic picture of the business's current scenario.

Existing Debts and Future Obligations

If the current business is in debt, which lots of businesses are, then you will certainly have reason to consider this when valuating/preparing your offer. Lots of operating businesses borrow money in order to cover points like supplies, payroll, accounts payable, and so on. Bear in mind that in some cases this can imply that profit margins are too tight. Many organisations come under a revolving door of taking loans as a way to pay back various other loans. Along with debts, there may also be future commitments to think about. There might be an outstanding lease on tools or the structure where the business resides. The business might have existing contracts with suppliers that have to be fulfilled or might result in fines if canceled early.

Understanding the Customer Base, Competition and Area Demographics

Just how do businesses in the location draw in new clients? Many times, operating businesses have repeat consumers, which create the core of their daily revenues. Certain elements such as brand-new competition growing up around the location, road building, and also personnel turnover can influence repeat consumers and negatively affect future incomes. One vital thing to consider is the location of the business. Is it in a highly trafficked shopping center, or is it hidden from the main road? Obviously, the more individuals that see the business regularly, the higher the opportunity to construct a returning customer base. A last thought is the basic location demographics. Is the business located in a densely populated city, or is it situated on the edge of town? How might the regional median family earnings effect future revenue prospects?