- Business and Employment»
- Small Businesses & Entrepreneurs
Liberty Tax Service Franchise For Profit
Too Many Taxes
I recently took the Liberty tax class in hopes of getting a decent job. Liberty Tax Corporation is a large company and at the same time it is a small business due to it’s franchise policy. Everyone in the class was there for the same reason. Unfortunately, none of us were hired because the franchise owner, John, hired back his preparers from the previous year. Some of us were disappointed because all the way through the last class, he led us to believe that his previous preparers were not interested. The class was “free”, but we all paid for our books at 120 dollars each. Ultimately, I have concluded that, as a franchise owner, he is required to hold a class each tax season and he does make a small profit on the books. I am still glad that I took the class because I can take the certification test and receive the credentials to prepare others’ taxes, even if it is not with Liberty Tax Service.
The Government Takes Tax Evasion Seriously!
The corporate headquarters of Liberty Tax Service is in Virginia Beach, Virginia and there are over 3100 franchises operating in the United States. A franchise usually has a business model that the franchise owners have to follow. This can be good if you are not sure how to run a successful business. Most people like to have a little control over their business and with this franchise, the corporation has the control. On the other hand, the corporation provides support in all aspects of the business. Think of it as a small business with training wheels. The franchise has a buy in price of around 40,000 dollars, but by the time you complete training, you will need upwards of 100, 000 dollars. The good thing about this franchise is that each one gets it’s own territory and they do not group them together. That way, each franchise has a customer base to start with. It is a difficult business because the tax season is only 3-4 months long and then you may get 20 or less returns to prepare the rest of the year. That, of course, is just starting out. As you build your business you may eventually have work all year long. Some returns are more complicated than others and extensions are often applied for, so it is conceivable that you could work through October 15th. I would think that it would be a better second income than a first.
Most people think of H&R Block when they think of tax services, but in the last 12 years, Liberty Tax Service has become the third largest tax preparation company, behind only H&R Block and Jackson Hewitt.
A record 90 million returns were filed electronically last season and the trend is increasing. The customer based continues to grow because there are more and more taxpayers each years. Those who retire still have tax returns to prepare so there is not a natural decrease as in other businesses. Indeed, approximately 62% of taxpayers paid someone else to prepare their returns last year. In addition, Liberty Tax Service also caters to those who wish to do their own returns at home with Liberty’s software, eSmart Tax.
If you are going to buy a franchise, a tax service is a good bet because filing taxes is mandatory, so there will always be some that need your services. In addition, the government makes it just complicated enough to make many people wary of doing their own, and the tax law changes every year! Liberty Tax Service may not be the franchise for you, but there is money to be made in preparing taxes.
If you liked this hub, please rate it up!