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How to Start a Virtual Tax Preparation Business
How to Start a Virtual Tax Preparation Business

The tax preparation business was originally built around the storefront with the ultimate goal of getting taxpayers in the door consistently year-over-year. Over the last decade, there has been a shift in culture, technology, and methodology for the everyday tax professional that has led to an increase in virtual tax businesses.

Below are the major components of starting a virtual tax business.

Form a Business Entity

Choosing a business entity can be one of the most important decisions a business makes when getting started. This decision should be decided carefully and structured for the specific individual or company’s needs. The type of business you form determines which tax form you will file with the Internal Revenue Service during tax time. According to the Internal Revenue Service, the most common forms of business are:

  • Sole Proprietor
  • Partnerships
  • Corporations
  • S Corporations
  • Limited Liability Company (LLC)

For more information, or to help decide which business entity is best for you, check out this article from the U.S. Small Business Administration (SBA) at


Choosing a business name needs to be unique to your business. A creative name that has been researched against the market will be the best solution. Once you find the right name for your virtual business, it is always a good idea to register the name. According to the SBA, there are four diverse ways to register your business name:

  • Entity name protects you at a state level
  • Trademark protects you at a federal level
  • Doing business as (DBA) does not give you protection, but it might be legally required
  • Domain name protects your business website address

Logo and Branding

Developing a logo that sets your virtual tax business apart from the rest, and building a brand that directly reflects the goals, values, and solutions your business brings to the industry are key steps when determining your brand. If you are a creative person, these steps may be something that comes easy after researching the industry and settling on the direction for your brand. For those who are not as creative, there are a ton of online resources you can purchase to help you create what you need, as well as options to hire someone to assist you. Companies like 99designsFiverr, and Upwork all deliver multiple solutions for developing your brand.

Know Your Target Customer

Your target customers are the people that are most likely to use your services. In this case, that customer may be a certain demographic of taxpayers, certain occupations, or just taxpayers in general. Identifying your customer base will make your marketing strategies more direct and effective come tax time.

Online Marketing

Once you have established a brand and identified your customer base, you can now start to think about marketing strategies to build your brand awareness and attract new customers to your virtual tax business.


Running a virtual tax business means you will not have an actual storefront to highlight your professional services, so having an online presence will be key to your business’s success. Developing a website for your virtual business can be scalable when it comes to price. Typically, paying a vendor like SquarespaceWix, or GoDaddy can be cheap and easy to set up. These sites will include domain options, hosting, and design elements to complete the entire process of developing your online presence.

Social Media

Social media is king when it comes to brand awareness these days and is not going away anytime soon. Brands like Facebook, Instagram, Twitter, LinkedIn, TikTok, Snapchat, and the second most used search engine on the planet, YouTube have dominated the attention of our entire generation. Content creators, businesses entrepreneurs, and global icons have all bought into the thumb-numbing platforms for over a decade now. Developing social media accounts for your virtual tax business is a basic but important part of developing your online presence and marketing strategy. Each platform is similar but different in its own unique way. The best advice when it comes to social media is to download the app and get right into learning the platform before you start using it as a tool for your virtual tax business, and how the app is best utilized for your unique business needs.


SEO means Search Engine Optimization. This process utilizes an analytical approach when it comes to web design, content creation, and keyword management. SEO is a highly successful way to build your online presence but may require a higher level of knowledge for the everyday tax preparer. If you are just starting an online marketing strategy it may be best to start slow then work your way into a high-level SEO approach. The world of SEO can be overly complex so we would recommend starting your journey into SEO by using a free online resource like Google’s article called, Google Search Central – Search Engine Optimization (SEO) Starter Guide. Once you understand the basics of SEO, then you can start your research on which SEO platform you would like to use going forward.

Create Content

Content creation is extremely important these days and can range from a wide variety of formats. Those formats can be, but are not limited to:

  • Blogs and articles
  • Images and infographics
  • Videos
  • Email campaigns
  • Audio and podcasts

Utilizing tools such as SEO can make this process easier when it comes to what others are interested in and what keywords are trending over others. Using social media to develop content is a casual way to continuously produce content for your virtual tax business. A rule with content creation is to maintain an online presence while giving value to your customers for nothing in return. Traditionally, consumers do not want to feel like you are always selling something. Letting your customer know you are here to deliver valuable content with no strings attached may be a better approach when thinking about your next TikTok rather than trying to sell them on the next greatest solution you have to offer.

Tax Preparer Qualifications

Any tax professional with an IRS Preparer Tax Identification Number (PTIN) is authorized to prepare federal tax returns, according to the Internal Revenue Service. Most states do not require any additional licensing, certifications, or authority to prepare any state tax returns besides:

  • California
  • Connecticut
  • Illinois
  • Maryland
  • Nevada
  • New York
  • Oregon

Many states exempt this requirement if you are a CPA or have other professional credentials.  Depending on your organizational structure, you may want to do your own research of these requirements when it comes to tax preparer qualifications for your virtual tax business. For more information on tax preparer qualifications or to learn how to get a tax preparer license, see


According to the Internal Revenue Service, anyone who is paid to prepare or assist in preparing federal tax returns or claims for refund must have a PTIN. All enrolled agents must also have a PTIN. Attorneys and Certified Public Accountants do not need a PTIN unless they are compensated for preparing or assisting in preparing federal tax returns or claims for refund.

A PTIN cannot be shared among multiple individuals or one office. Everyone must obtain his or her own PTIN.

How to Get a PTIN

A PTIN can be obtained at IRS Tax Professional PTIN System by registering your account. The online process will only take a couple minutes to complete, and you will also need to pay the annual fee.

For more information on PTINs (Preparer Tax Identification Numbers) and how to obtain one, visit


EFIN (Electronic Filing Identification Number) is assigned by the IRS to identify firms who have submitted that they have completed the IRS eFile Application to become an Authorized IRS eFile Provider.

How to Get an EFIN

Obtaining an EFIN for your virtual tax business is very important and will be a requirement to get your business off the ground.  If you file more than 10 tax returns, the IRS requires tax preparers to file tax returns electronically. The IRS requires three steps to obtain an EFIN and those are:

  • Create an IRS e-Services Account
  • Submit your application
  • Pass a Suitability Check

For more information on how to get an EFIN from the IRS, visit


Finding the right tax software that supports your virtual tax business’s vision will be a key component of running a successful operation. Tax preparers that are working virtually and want the ability to work on multiple devices and in multiple locations would be better off using an online tax software solution. Traditionally, desktop software will be limited with mobility and features for a tax professional on-the-go. Online solutions are meant to pick up and go with today’s professionals, and are generally available across most platforms. We suggest developing a list of necessary items that you want out of your tax software to run a successful virtual tax business and assessing them before making this decision. The last thing a tax professional wants to deal with is to get halfway through the tax season and realize your business is better off with another solution. Switching to a different tax software is possible, but it would not be enjoyable midseason and it would be best to address the issue after season.

CrossLink Online

CrossLink Online

We recommend CrossLink Online as the software of choice for your virtual tax preparation business. Simple enough for brand-new preparers, yet powerful enough for the most complex service bureau environments — CrossLink Online is built with your unique business in mind. CrossLink Online is a scalable and flexible solution that supports all Internet accessible devices and platforms. Get access to CrossLink’s industry-leading features like TextLink Plus, Scan & Store, and integration with our Mobile Apps and Remote Signature Capture with the benefits of being able to prepare tax returns from any location with an internet connection.

Sky is the Limit

The number of virtual tax businesses are growing each year. Whether your business is just seasonal, or you do this full-time, it is important to have a plan. We hope these key items can assist you when getting started.


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