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Practice Management (Forum Locked Forum Locked)
 CPAnet Forum : Practice Management
Subject Topic: New pratice idea.. (Topic Closed Topic Closed) Post ReplyPost New Topic
  
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killer2021
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Joined: 12 Apr 2008
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Posts: 239
Posted: 30 Dec 2009 at 07:05 | IP Logged  

So the standard way a CPA office works is that the office
gets a client list and those clients go to the office.
The CPAs/tax preparers then file all the returns etc etc.
The tax prepares get paid hourly/salary and the owner
takes the rest as profit.

I want to form a new tax preparation business but with a
different idea. Instead of me having the client list,
each tax preparer will get the clients as if they are
self-employed. I will provide the central location with
computers/software for the preparers to use. I will also
provide any other misc. tasks that are required to run
the office. That way the tax prepares will focus directly
on building up their client lists and then they will take
those client lists to my office and the tax preparer will
file their returns. I keep 20% of the profit and the
preparer keeps 80%. Everything is tied directly to
commission. If the preparer gets no clients, they make no
money and if they get lots of clients they make lots of
money.

I figure it would be a very good idea and my tax
preparers would be those who want to start their own firm
but don't know how or the overhead is too high for them
(ie. college kids/CPAs working for private company).
My firm idea would provide that solution for them. They
would need no direct investment (aside from getting
certified and/or learning to file taxes) and could focus
directly on finding clients and building their client
lists.

Thoughts? If you were considering opening your own
practice would you consider this idea as a possible
alternative?
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WORKnSTUDY
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Joined: 05 Apr 2009
Location: United States
Online Status: Offline
Posts: 187
Posted: 30 Dec 2009 at 13:28 | IP Logged  

I'm not so sure about that.  Your business model will eventually gut you of your best employees and lower your long term profits.  I would say pay your best an amount of money that makes them want to stay instead of incentivising them to take their clients and run.
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killer2021
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Joined: 12 Apr 2008
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Posts: 239
Posted: 30 Dec 2009 at 18:43 | IP Logged  

true, that is one of the potential flaws to the business.
Perhaps one, "employee" will get so many clients that they
want to start their own little operation instead of going
through me. However, I could probably make them sign a, "do
not compete within 50 miles clause."

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brendaledb
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Joined: 23 Nov 2009
Location: United States
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Posts: 101
Posted: 02 Jan 2010 at 14:47 | IP Logged  

I'm not sure you could do a non-compete.  If they opened up a CPA firm, that is different from what your business is offering.  So, they would not be a rival since their business model would be different. Your "employees" don't sound like true employees, more like a 1099 situation. 
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killer2021
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Posts: 239
Posted: 04 Jan 2010 at 05:16 | IP Logged  

brendaledb wrote:
I'm not sure you could do a non-compete.  If they opened up a CPA firm, that is different from what your business is offering.  So, they would not be a rival since their business model would be different. Your "employees" don't sound like true employees, more like a 1099 situation. 


Yes, they aren't employees in the sense that they get paid hourly or whatever. Its straight commission. There has to be some way to prevent that from happening.
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