Women entrepreneurs are a growing force in the U.S. economy. In 2021, nearly half (49%) of all new businesses were started by women, a 75% increase from 2019. While industries like tax and finance have traditionally been male dominated, the demographics of these roles are shifting.
As of 2022, 56.8% of all certified public accountants (CPAs) were female. However, women working at finance and tax firms continue to face challenges. For one, female CPAs generally make only 94% of their male counterparts’ salary. They also experience significant barriers when it comes to reaching leadership positions. Despite making up about half of all CPAs, only 21% of tax firm partners are female.
Perhaps it’s not surprising then that more female tax professionals are starting their own businesses. In this post, we’ll share some suggestions for success and best practices for women tax entrepreneurs.
7 tips for female tax entrepreneurs
While the following recommendations are useful for any tax professional regardless of gender, they can be particularly important for women and other underrepresented gender identities working in the tax and finance fields. We hope you find them useful as you continue to grow your tax business.
Set your business apart
The tax industry is a competitive one. Taxpayers have several options when it comes to preparing their returns. They can go with a national tax agency like H&R Block and Jackson Hewitt, a local tax firm or a do-it-yourself option like TurboTax. They can also select a small tax business like yours.
In this crowded market, it’s important to know what makes you stand out. So, spend some time thinking about your positioning, competitive advantages or specific niche. Maybe you have experience working with other small business owners, freelancers or contractors. Perhaps your specialty is in a certain industry or tax area, such as real estate, intellectual property or law. Or maybe you’re able to charge a lower price than the competition.
Spread the word
Once you’ve determined your tax business’s niche or advantage, use it to drive your marketing efforts. These can involve everything from digital marketing, like social media, email marketing or banner advertisements, to flyers and business cards.
If you have a website for your tax business, be sure to highlight your specific skill set and areas of expertise. Also, remember that simple word-of-mouth is a powerful marketing tool. Tell your relatives, friends and former colleagues about your tax company, and make sure that satisfied customers have a way to recommend and review your services. You can even offer them a discount on future services as a way of thanking customers for bringing in new business.
Network with other professionals
Another way to get the word out about your tax business is through networking. By meeting with other small business owners in your local area or field, you can share tips and ideas, answer questions and help each other solve challenges. You might even make some great friends or find a mentor to guide you on your entrepreneurial journey.
For women, mentorship is especially important due the challenges many female business owners face, from work-life balance to financial struggles to outright discrimination. Fortunately, many networking and mentorship options exist for women, including Women’s Economic Ventures and SCORE, as well as various local start-up communities.
Never stop learning
Even the most successful tax professionals need to constantly be updating their skills and staying up-to-date on the latest changes to the tax code. As you continue to grow your business and expand your client base, seek out opportunities for additional certifications that can take your company and your expertise to the next level.
These might be directly related to tax preparation (for example, our many continuing education courses), or perhaps you’d like to take a marketing course, graphic design seminar or educate yourself on another topic adjacent to your main business. While many fully online options are available, you might also consider taking a course offered by a local community college or other educational organization. That way, you can meet other small business owners and familiarize yourself with nearby resources.
Take time for yourself
Being an entrepreneur is hard work. When you’re not completing tax returns, meeting with clients, sharing financial advice or managing your day-to-day business tasks, you’re looking for the next client or project and finding new ways to market your services. On top of all that, many female entrepreneurs have significant family responsibilities and social obligations. There’s also the risk factor that comes with self-employment, which can lead to financial and emotional stress.
All these things can contribute to burnout, which can then lead to errors and possibly even to unhappy clients. So be sure to prioritize taking time for yourself. If needed, make yourself a calendar reminder to carve out time for something you enjoy, whether that’s spending time with loved ones, taking part in a fun activity or trying out a new hobby. While these breaks might seem like lost earnings, they’ll benefit you and your business in the long run.
Look out for applicable tax credits and benefits
As a tax professional, you’re always looking for ways to help you clients save money and reduce their tax liability. Why not do the same for yourself?
New businesses are often eligible for tax credits, and female founders might be able to apply for additional programs that will financially benefit their company. These aren’t limited to tax breaks; grants and other funding could be available for women entrepreneurs in your area. So do your research, ask fellow small business owners and search online for additional monetary resources for which you might be eligible.
Gather the right tools
Most likely, you already have access to the online tools of the tax trade, including tax prep, accounting and bookkeeping software. But what about marketing? Customer relationship management (CRM)?
These are also key components of your business, and many free or low-cost options exist for managing them. For example, you might select an email marketing tool like Mailchimp to keep in touch with your clients well beyond tax season. Or you might want a small business-focused CRM solution to keep better track of your accounts and segment them by industry or service. If your business has expanded to the point that you’ve hired additional employees, payroll and HR software might be another smart investment.
Set your tax business up for success
If you’re looking to expand your knowledge base and maybe even reach new clients, browse our continuing education course options. Surgent Income Tax School can also help you grow your tax business, whether you’re just starting out or already have an established tax practice.