How to Set Up a Tax Business
Written by Kimberly Fowler

Starting your own professional tax business can be a detailed process, especially when you consider the rules, regulations, and constantly changing IRS legislation. Whether you're looking to become a solo practitioner or grow a larger practice, here’s an overview of the steps you can take to successfully start your professional tax practice.

1. Register Your Tax Business with Your State

Consult a professional for guidance

Before you start operating, you need to register your business with your state. This involves choosing the type of entity for your company. You can either file a Doing Business As (DBA) name or form a Limited Liability Company (LLC) or corporation. The structure you choose will affect your taxes, liability, and overall business operations, so it’s essential to consult a professional to ensure you make the right choice.

2. Obtain Your PTIN and Apply for Your EFIN

If you plan to charge for tax preparation...