#498 How to Build a $50k/Month Tax Advisory Practice

In this episode of the Main Street Business Podcast, host Mark J Kohler shares an insider's perspective on becoming a successful Tax Advisor. Mark maps out the process, reveals the untold benefits and dispels the common myths of advisory services, and encourages you to take the next step.

Here are some of the highlights:

• Mark urges you to set goals, establish their motivation, and self-evaluate before making the leap into advisory.
• Mark maps out the technical training steps: becoming a certified tax advisor, enrolled agent, and training on tax return preparation.
• Emphasizes the need for street-smart tax strategies to provide valuable advice to clients.
• Importance of hiring an executive assistant to handle administrative tasks and support client management.
• Encouragement to follow ALL the necessary steps for building a successful advisory practice.
• Overview of the resources, benefits, and training opportunities within the Main Street Tax Pro Network.
• Details on conferences and workshops offered to enhance skills and collaboration in the tax advisory field.

This episode is a must listen for anyone looking to build a successful tax advisory practice!

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Transcript

Building a $50k/Month Tax Practice

Speaker 1 0:01

So this is the blueprint to making over $50,000 a month as a tax advisor . For the last 20 years I built a tax advisor practice and now 10x these revenue numbers . But now I've turned to helping new tax advisors build their practices and $50,000 a month child's play . I'm going to show you how Now , in this video . I'm going to walk you through the five major steps to build this practice of $50,000 a month .

Speaker 1 0:24

This information is very hard to come by . You don't learn this in school or in a CPA exam or enrolled agent exam . I didn't learn this at law school . You go out to work in the industry that's already broken and hope they share with you these secrets . They don't , in fact , they're struggling to build their practices . But I'm going to give you these steps to build a successful accounting practice . Now I don't want you to just sit around waiting for the right client to walk through the door . I want you to be intentional , building the business that you want . This means having powerful consultations where clients pay for what you're worth and you're making the money to make it a win-win situation in this difficult industry .

Speaker 1 1:01

Now sit back and let's hit it . Okay , now , before we get to step one , we need to talk about a couple preliminary matters , questions and assumptions . First , a lot of people think to be a tax advisor , I've got to be a CPA , I have to be an enrolled agent , I have to be a lawyer , I have to be CFP a certified financial planner . I've got to have some sort of acronym or designation or degree or credential before I can become a tax advisor . Wrong Now , there's going to be some technical training and I'm going to come to that in your five steps . But don't think that you've got to have all this before you start or that it's going to take years and years . Right now in the accounting industry , it's this huge barrier of entry that I've got to be a CPA to succeed as an accountant . That's not true , and it's a lot of work to become a CPA . I've done it , I've been there . But there's a lot of great tax advisors out there that don't have a CPA behind their name , so let's not worry about credentials .

Speaker 1 1:57

Next , let's talk about some financial assumptions here . If we're talking about making $50,000 a year , I'm talking about gross income . We're going to be talking about net and profit and scaling here a little bit , but $50,000 a month of gross income In my experience and this is 20 plus years of experience doing this the average advisory client is going to be between $6,000 to $12,000 a year . You're going to meet with them either monthly or quarterly . You might be providing some tax prep , some bookkeeping , payroll or just simply advice along the way , being their quarterback . So that would mean that the average tax advisor client is probably going to be paying you around $800 to $1,000 a month . So if we have 50 clients , we're going to be pushing $50,000 a month of gross revenue . If I have 100 clients , we're going to be close to $100,000 a month in gross revenue , or a million dollars plus a year .

Speaker 1 2:48

As we're going through this model , we're going to be talking about a goal of getting this number of clients a client base of 50 to 75 . You might have some clients that don't pay you full advisory services per month , but you're also going to have other clients that pay you for ancillary things and support building business plans , giving them some debt consulting , doing additional tax returns they might need or all sorts of advice . So some clients are going to pay you more , some are going to pay you less , but we want to work on this average assumption of about 50 to 100 clients , paying you an approximate number of $800 to $1,200 a month . All right , so major step number one this is the quote-unquote , unquote , touchy , feely part , but it is absolutely critical . We just don't want to rush off into the sunset on this journey to be a tax advisor and make fifty thousand dollars a month or more and not understand what that entails .

Building a Successful Tax Advisory Business

Speaker 1 3:38

What type of lifestyle do we want ? Am I willing to invest in some employees ? Do I want to work from home ? How many hours a week do I want to work ? What is your why ? Is it simply making money ? I'll tell you , I've done that . I've said , ooh , I want to make X amount of dollars . And then I make it and I'm like I'm the same person . That wasn't worth it . We've got to have a real why , a burning passion . For me , what that is , to be honest , is I want to help people live their American dream . I love small business , I love entrepreneurship . That's my why . What's your why ? That's going to be a critical question from the outset , and you want to be able to give your pitch in a very , very simple three sentence format of what you're doing and why and where you're going Now .

Speaker 1 4:18

With that said , you're going to be scaling throughout this process . You're going to have different platform levels . Maybe I call platform two is when you have an executive assistant . Platform one is you're just an entrepreneur all by yourself , working out of a shared office space or a home and you're starting to build your tax advisory practice , with or without credentials and training , and you might be kind of slogging along , and why you're listening today is there's got to be a better way to do it , maybe , and you're like Mark , teach me . But platform two is where we bring on our first employee and we have an executive assistant . Platform three could be a three to four employee level . Platform four we're pushing 10 employees or more and then we're going to see our revenue increase throughout that process . But you're also going to have to change during that process . You're not going to be as much of a technician working on returns , a technician working on returns . You're going to be more of a leader and a manager and managing employees . Some people love that , some people hate that .

Speaker 1 5:08

You've got to really do some soul searching here of where do you want to take this , how far do you want to go ? And again , you don't have to set this big old goal I want 50 employees . We don't have to see what it's going to look like 30,000 miles from now , but we do want to see where it's going to look a thousand miles from now . What's this journey going to look like , and am I going to enjoy the process ? It's not always about the destination . It's about becoming the right person along the way . So step number one is really having that self-evaluation of setting a goal that resonates with you . It's going to drive you . It's going to create empowerment and passion and energy , because it's going to be hard . You're going to have to wake up every day and dig deep to find that power and that energy to succeed . So let's set an intentional goal . That's your goal and no one else's .

Speaker 1 5:50

Now , part of this step as well is the timeline . We've got to be thinking . How hard do we want to push ourselves ? What is our current life circumstance ? Married or single , young or old ? Do you have other resources to rely on , or are you , like , unemployed , and you got to hit it hard tomorrow ? Everybody's in a different situation , in a different life phase , with different experiences and different needs . So this timeline is much like I talked about with the why and the goal and the purpose is it's individual to you . So start penciling out how aggressive you want to be on this timeline in 2024 versus 25 or 26 . Now , this goal of making $50,000 a month , you can have it this year if that's what you want to do , but it's going to take some work , so be realistic about your timeline as well .

Speaker 1 6:32

Okay , steps two , three and four are highly related and they're the technical piece of this process , meaning there's got to be some technical training , obviously , to get there . Now , these don't have to take long , you can do all three simultaneously and they don't have to be expensive , but they have to be taken care of . So I'm going to list these three next steps below and then we're going to unpack them . Step number two is becoming a certified tax advisor , getting the technical training necessary to know strategies . These are absolutely critical in the consultation phase of providing a holistic approach of advising your client . Step number three and it might surprise you is that I want you to become at least an enrolled agent . Go through the exam process and get that designation behind your name . I'll explain why in a moment .

Speaker 1 7:16

Number four is getting trained on preparing certain types of tax returns , and I'll explain why this is super important here in a moment . And again , remember step two , three and four are all interrelated and can be done simultaneously . You could be working on your enrolled agent exam , working on your certified tax advisor status and learning how to prepare returns all at the same time . I see many of my members in my certification program knock this out in about a three-month process . Now they're really doubling down on time and effort , at least on the evenings and weekends and a good chunk of their days , and if they have a day job they're burning the midnight oil , but in two to three months you can accomplish all three of those .

Speaker 1 7:54

So the certified tax advisor status is something that's extremely important because when you get into a meeting with a client on a Zoom call or in person and they're asking for strategies that actually move the needle , we've got to learn these strategies and I talked to CPAs that have been accountants for 20 plus years that think they know it all and they realize , oh my gosh , the trifecta mark and helping people get out of debt and how to write off kids on payroll or not payroll , how to write off travel , dining , home office , using the 1202 strategy in the right way or not . Understanding asset protection , privacy strategies , crypto strategies , real estate tax strategies involving the self-rental , the long-term rental , the syndications the list goes on and on . I have a certification program with over 70 topics because there's that much . But there are street smart strategies and if you want to become a real tax advisor , you've got to have strategies that move the needle . You've got to be able to get on a call and wow a client . These are strategies you don't learn in typical CE Although my program has got tons of hours of CE and qualified continuing education hours . But we really need to focus on strategies that make sense for clients and are outside the box , which is not a typical accountant's mindset . So we need to get that status . We need to understand the strategies that really help a client save taxes and build wealth and protect their assets , because as an advisor you're going to bring it all together , you're not going to just operate in a vacuum . Becoming a certified advisor in my program is 12 modules , 70 classes . These classes help you provide this holistic quarterback approach for your clients that they're starving for and why they're going to pay you . Holistic quarterback approach for your clients that they're starving for and why they're going to pay you . You can't make 50 grand a month just coming up with the normal crap that the enrolled agent or CPA exam or CE gives you . You've got to be thinking outside of the box and making a difference for these clients .

Speaker 1 9:44

Now step three let's go back to the enrolled agent . I really think this is an important credential to even allow you work on behalf of a client with the IRS . If you're going to be an advisor for clients , you might have to pick up the phone , call the IRS . We teach classes on resolution and helping you know the basics of dealing with the IRS , but it's also having some cachet and status that you're certified as an enrolled agent . Now the exam process is not overwhelming . It is not that difficult Three parts . We have a partnership with Universal Accounting to help our certified tax advisors get through the exam quickly , efficiently and affordably . You don't need to spend a lot of money hiring personal coaches to get through the enrolled agent exam . You can do it and we have a great program to help our certified advisors get to that enrolled agent status , which I really believe is going to help you in your marketing and in your self-confidence that you've got at least some level of credential on top of the CTA , the certified tax advisor .

Speaker 1 10:41

Now , number four was learning how to prepare some tax returns . Hold on , don't freak out . I'm not saying you're going to prepare tax returns the rest of your career . But if you're going to be a tax advisor , you're going to have to understand how tax returns work . And if you're going to delegate the preparation of those tax returns , you've got to be able to review them , be able to read a tax return and see where the pain points are for a client and what could change to identify opportunities and risks . If you're going to be a tax advisor , you have to understand and prepare a few tax returns at least , and I'm talking about the 1040 , the 1065 , which is a partnership tax return , and the 1120S . Those are the three principal tax returns that 98% of small business owners are going to use . Well , let's know how they operate . Now , again , we have a relationship with a training company to help you get through a preparation course in these different returns . That can be done within a month and you're out there practicing , just filling out returns and learning what a tax return looks like so you can delegate .

Speaker 1 11:41

If you're going to be a quarterback , you got to know the routes of your receivers . Now you might not be able to run the route as fast as them or as good as them , but you got to know where they're going . You got to understand that route so you can read where you're going to throw the ball . What is the defense doing ? Where am I going to go with this ? So , knowing how to prepare a tax return is not your end game . It's a part of the tools to provide that advisory service , that advisory strategy . You can do it Now .

Speaker 1 12:05

After you've accomplished steps two , three and four . You are now technically trained to really get on that phone call with a client , on a Zoom call with a client , and make a difference . You are going to be very , very motivated , very confident , and if you're not there yet , I'm going to get you there Because in my community , in my tribe , we're there to help you succeed . Now it's time to ring the bell , which brings us to step five . Now , step five is the launch . This is doing the work on your business , not working in the business . We've got to get your name out there . We want you to look good . We need to be able to attract the right types of clients and we need to go through some basic steps .

Speaker 1 12:46

Let me just rattle off some of them . Do you have a logo ? What is your image ? What are your colors ? What does your brand look like ? Have you set up your entity ? Do you have your tax ID number ? Do you have your payment processes in place ? Do you have a CRM , a client resource management system , to track the clients that come through the door ? Have you got a basic marketing plan ? Where are you going to go for this ? In my program , we want to send you clients through our network , but you're also going to be creating your own marketing relationships and reach to get clients in the door . What are your systems and procedures ? What software are you going to use ?

Speaker 1 13:18

Are you going to outsource most of the work , part of the work or all of the work ? And remember , as a tax advisor , you've got to be at least managing the work for your clients . If you're not even doing it in-house , and that's okay you don't have to do it all . You can have a payroll provider , a bookkeeper , a tax preparer , and they could all be outsourced , but it's all going to come back to you to deliver to the client in that comprehensive approach . Because , think about it , you just can't operate as a tax advisor in the vacuum and say I'm going to make $50,000 a month telling clients what to do , and then the client's going to run out the door and where are they going to get it done ? Are they going to be in alignment with what you just told them to do ? Are you telling your client to go out and educate other professionals to do what you told them to do ? It's not going to happen . Been there , done that .

Speaker 1 14:03

You're going to say , hey , I've got a law firm here , I've got my tax preparation team , my bookkeeping team , my payroll team . We're going to be bringing this together . We're going to meet quarterly , monthly . Whatever your client needs . You're going to give them a monthly fee and you're going to be bringing it all together , which is what your client wants , any additional services they need . You're going to a la carte and charge on top of your advisory fees . This is how you ring the bell . This is how you bring in the money . So when we're launching the business and building this platform , your website needs to reflect that . Your systems , your software , your procedures need to be able to reflect that opportunity , that service you're providing .

Speaker 1 14:38

Now . After that , this is when the work begins . You're going to practice . That's maybe why they say you practice law or practice accounting , because it is practice . You are not going to be perfect . You're going to make mistakes and it's okay . Embrace those mistakes as you learn from them .

Speaker 1 14:55

Now , after you've completed those five major steps , it's now putting it into action , which you might've dabbled a little bit with along the way , because for the last two to three or four months , as you're getting through your technical training , building up your business platform , your website , you're going to start bringing in some clients and you're going to be kind of having a soft launch testing the wares , getting proof of product , finding out what you're good at , what you're not good at . And you're going to make mistakes , and it's okay . Because you're going to start building this practice and for every client you add to the mix , you should be adding $1,000 a month to your revenue . So 50 clients , it's not that hard . They start talking to their friends , mentioning your name at all their dinner parties and meetings . You're in a tax pro network like mine and you're doing some marketing . You're going to be busier than you realize very , very quickly . Which brings me to another

Scaling Your Tax Advisory Practice

Speaker 1 15:42

point .

Speaker 1 15:42

As you begin to scale , I don't think it's realistic that you're going to be able to launch and maintain 50 to 100 clients without an executive assistant , and my program is I help members go through the scaling process and hit breakpoints that require new skill sets and imagination and training . One of those first platforms platform two is having an assistant , because if you're going to maintain 50 to 100 clients , you've got to have someone handling the emails , the mail itself , staying in contact with clients , the engagement letters , managing payment procedures , as well as receivables and all of the things that go on behind the scenes that are really secretarial or administrative in nature . So at 50 to 100 clients , you're going to be bringing in 50 to 100 grand , but a executive assistant might cost you 40 to $45,000 a year . Well , that's only four or five grand a month . So if we can add three to five clients for a month , then we just paid for an executive assistant , so we can add 10 to 20 clients in the next quarter . So we get back to step one . Now you've got your goal and your timeline and we start to figure out how many clients do you need to add weekly or monthly to get to that $50,000 a month goal ? Now , I really think it's going to be around a 50 to 75 client count and we need to say , okay , how many can I realistically bring on ? Is that going to be three to four clients a week ? Okay , well , in 10 to 12 weeks I might have my 50 clients . Wow , guys , that's three to four months . So we've got all of 2024 .

Speaker 1 17:18

Now , in the middle of phase two of tax season , there's millions of people out there that filed extensions , that are still looking for a good tax advisor , tax preparer . They don't know what to do and you're going to start reeling them in bringing them in and building that client base . It is very , very doable . By the end of 2024 , you could have 75 clients bringing in 50 , 60 , $70,000 a month , paying for at least one employee to help you in that process . Folks , you could be making easily six figures . Low six figures . I mean two to 300 grand a year is not unrealistic for my tax advisors in their first to second year of practice . People , this is doable . It is not that hard .

Speaker 1 18:02

It's following steps that I've set forth here , staying committed to those steps , not trying to shortcut them , and being humble enough to learn and try and practice , learning from your mistakes and not feeling scared or frustrated along the way . Now , my friends , those were the five major steps to build an advisory practice , and I stand behind them . I've done it . I've been there . You follow these steps , you will succeed and reach those financial goals that I promised you at the beginning . You now have the blueprint , the action items , the steps you need to take to get to that $50,000 a month in revenue or more .

Speaker 1 18:36

Now , if you want to avoid making unnecessary mistakes and be a part of a tribe and a community and get the training to make this happen , please click on the link below and get a free demo with one of my people about my certification program our family , where I teach how to scale , how to help your business grow and give you all the technical support on the tax strategies that are going to move the needle in consultations . And with all that said , if you want to avoid the pain and the opportunity cost of trying to implement all this by yourself , please look at our community , look at the MainStreet Tax Pro program . We are a community of like-minded individuals trying to change the accounting industry . Click on the link below and meet with one of my people , have a free demo and learn what this program is about , and this is far , far more than learning some kick-butt tax strategies , which I totally believe in . I'm going to teach you how to have a consultation , what to do in a consultation and the strategies to implement with different types of clients . But we're also going to talk about business building and scaling and growing and how to build that practice .

Speaker 1 19:38

And then , most importantly , I have TaxPro Network platform where , when I'm out on YouTube and around the country speaking , I tell business owners that are starving for tax advisors that speak my language a place to go . I'm telling them how to get to the network and select on your profile and interview and hire you . And I don't get any money out of your relationship with your clients . I just want to build that platform , train you and get you on it and get you out there bringing in these clients that are of high value to help you build the practice of your dreams . Now I promise you and this is my guarantee after you get certified and get on the Tax Pro Network with your basic foundation of marketing principles , which we teach and will help you get there , within three months , if you don't have new client revenue that exceeds the cost of joining my program , I'll give you your money back and to this day I haven't had to give anybody their money back .

Tax Advisor Success Program

Speaker 1 20:28

I am committed to seeing you succeed . We have weekly trainings , weekly meetings , a Facebook forum , other platforms and forums where we meet and talk about how to become a superpower tax advisor . We have monthly mindset coaching and training on goal setting and the thought work it takes to get there . We have monthly trainings on business building and scaling and how to hire and fire employees and bring on clients . There are so many resources and benefits to help you succeed in this program . I also have two conferences a year three-day workshops the Tax and Legal 360 event . It is amazing , with tax professionals from around the country coming together to collaborate , let their hair down and learn about real tax strategies and how to grow and how to market and how to bring all these different aspects of being a tax advisor together . And you know what the coolest part of this whole program is to me that I get to associate with you and learn from you . I have been shocked at how much I really didn't know about being a good tax advisor . We have training sessions with sometimes 300 accountants from around the country , many with years experience beyond me , sharing little nuances and strategies and rev rules and cases and forms and worksheets and protocol and collaboration . That is just . I never envisioned it would come together like this . It is absolutely amazing .

Speaker 1 21:46

If you're starving for a tribe of individuals that want to build a real accounting practice . You just found it Again . Please click on the link below , get a demo , learn about this , find out what you're missing and it is going to blow your mind . So what are you waiting for ? Are you ready to make $50,000 a month or more ? Are you ready to build the practice of your dreams ? Do you want to be with a group of individuals that are trying to do the same thing you are and building a practice of their dreams , making $50,000 , $100,000 a month in gross revenue or more People ? This is where it's at . You just found it .