Is starting an accounting firm worth it?
Yes. Starting an accounting firm can be a highly rewarding and profitable venture if you plan strategically. According to industry data, accounting remains one of the most lucrative small business sectors, offering strong recurring revenue, scalability, and flexibility.
Owning your own firm puts you in control and lets you keep the profits you generate and serve the type of clients you choose. By adopting new technologies like cloud solutions and AI, you can get your accounting firm up and running quickly while also gaining a competitive edge.
Why would I want to start an accounting firm?
Beyond financial benefits, accounting firm ownership gives you independence and an opportunity to shape your own work culture, client base, and service model.
You can decide which industries to specialize in and tailor your service offerings to meet client needs. Many firm owners also expand into advisory and consulting services, creating additional recurring revenue streams beyond compliance work.
What are the requirements for opening an accounting firm?
Starting an accounting firm is similar to launching any other small business, but with a few profession-specific considerations.
Your checklist to start an accounting firm:
- Ensure you have the proper credentials for tax preparation.
- Obtain an employer identification number (EIN) and tax ID.
- Choose your legal entity structure (LLC, S Corp, partnership, etc.).
- Determine startup costs and pricing structure.
- Secure business insurance and a business bank account.
- Create internal policies and risk management practices.
- Hire staff or contractors as needed.
You’ll also need to comply with federal and state requirements, especially regarding client confidentiality, licensing, and tax filing credentials.
Will I need to get a new EIN from the federal government?
In most cases, yes. If you plan to hire employees or form a business entity, the IRS requires an employer identification number. Even sole proprietors often obtain an EIN for banking and privacy reasons. The process is quick, free, and can be completed online through the IRS website.
How much does it cost to start an accounting firm?
Startup costs typically range from $2,500 to $25,000, depending on location, technology, and whether you choose a virtual or brick-and-mortar business model.
Essential investments include accounting software, insurance, marketing, and compliance costs, while cloud-based solutions help reduce overhead and enable flexibility from day one.
What’s the best business structure for accounting firms?
The best legal entity structure depends on your goals and risk profile. Most new accounting firms start as an LLC or S corporation for liability protection and tax advantages.
Solo practitioners may prefer an S corp for payroll benefits, while partnerships allow flexibility for multiple owners.
Can you own an accounting firm without being a CPA?
Yes. You can own an accounting firm without being a certified public accountant (CPA), depending on your state’s regulations.
While all CPAs are accountants, not all accountants are CPAs. Non-CPA accounting firms can offer bookkeeping, payroll, and tax preparation services, but cannot provide audit or assurance services. If those services align with your goals, consider pursuing CPA licensure or partnering with a CPA.
However, if you don’t want to offer audit work, you can absolutely build a successful accounting firm as a non-CPA.
Can accountants work from home?
Absolutely. Thanks to cloud technology, accounting firms can operate entirely remotely or through a hybrid model. Many successful accounting firms serve clients virtually using solutions like UltraTax CS, SurePrep, and SafeSend.
However, if you work from home, remember:
- Obtain a separate electronic filing identification number (EFIN) for each location where you perform work.
- Check local zoning laws for home-based businesses.
- Maintain data security and professional boundaries in your home office.
Look for tax software solutions that are designed for cloud collaboration, secure document management, and virtual tax preparation.
What are the key services offered by accounting firms?
Most firms start with core offerings such as:
- Tax preparation and planning
- Bookkeeping and payroll
- Accounting and financial reporting
- Advisory and consulting services
The fastest-growing accounting firms typically expand into higher-value advisory work. Diversifying your services builds stronger client relationships and steadier income streams.
How are accounting firms using AI?
Accounting firms are increasingly using artificial intelligence to automate manual work, improve accuracy, and deliver deeper insights.
AI tools help with:
- Data entry and reconciliation
- Document review and summarization
- Tax research and workflow optimization
- Predictive analytics for advisory services
Modern AI-powered solutions like Thomson Reuters CoCounsel help firms deliver faster, higher-quality work and focus more time on strategic client advisory.
What should I know about running an accounting firm?
Running an accounting firm means balancing client service with business operations. Key priorities include:
- Building a culture that attracts and retains staff by supporting development and well-being
- Expanding beyond seasonal tax work into year-round advisory and consulting
- Staying updated on tax law and reporting requirements
- Investing in integrated tax software to streamline workflows
How much should an accountant charge per hour — or should they use a fixed fee?
It depends. Hourly billing still exists, but most firms are shifting toward fixed-fee or value-based pricing. These models reward expertise over time spent and provide clients with predictable costs.
Hourly pricing may be useful early in your career or when scoping new projects. However, as you become more efficient, value-based pricing aligns better with firm growth.
How should I price accounting and bookkeeping services?
Bookkeeping and standard accounting services are almost always priced as fixed fees. To determine pricing, research local competitors and consult industry associations like the National Association of Tax Professionals (NATP).
Tools like Thomson Reuters Practice Forward offer templates, pricing calculators, and guidance to help you shift from compliance-based pricing to profitable advisory service models.
How much should a CPA charge for taxes?
CPAs generally command higher fees due to their expertise and licensing. Many set a minimum job value — like $500 — to avoid low-margin work and focus on higher-value engagements.
Balancing premium rates with client value is crucial. Fixed-fee structures with transparent deliverables help clients understand what they’re paying for and reinforce your value as a trusted advisor.
How do I market my accounting firm?
To market your accounting firm, start by partnering with complementary businesses and joining local networking groups, such as your chamber of commerce, to expand your reach.
In addition, look for speaking opportunities at community or professional events where you can share insights on tax planning, small business accounting, or financial management.
Also, consider offering free educational sessions or webinars to help position your firm as a trusted expert.
How about social media and online presence for accountants — are they worth the effort?
In today’s competitive market, an online presence isn’t optional; it’s essential to establishing authority, attracting ideal clients, and growing your practice.
Use this checklist to get started:
- Create a professional, SEO-optimized website that highlights your services and expertise.
- Claim and optimize your Google Business Profile to improve visibility in local searches.
- Stay active on LinkedIn, where business owners often look for accounting professionals.
- Use client testimonials and referral programs to build credibility and generate new leads.
How do I get accounting clients?
The best client acquisition strategy combines referrals with targeted digital marketing:
- Provide excellent service to earn referrals.
- Network locally through chambers of commerce or trade groups.
- Use Google Ads and social media to boost online visibility.
- Offer thought leadership through blogs or community events.
Consistency and visibility are paramount — clients hire accountants they trust and recognize.
How do I scale an accounting firm?
To scale successfully, follow these steps:
- Use cloud-based tax and accounting platforms to automate workflows and reduce manual work.
- Hire staff or outsource to manage capacity.
- Offer value-based advisory or accounting packages to build recurring revenue.
- Invest in AI-powered solutions to increase efficiency and profitability.
Scaling isn’t just about adding clients. It’s about building sustainable systems that grow with you.
If they need more staff, what do accounting firms look for when hiring?
When accounting firms are hiring new staff, they look for more than just technical accounting skills. They want well-rounded professionals who bring both credentials and soft skills to the table.
Traditionally, firms prioritized certifications such as CPA, enrolled agent (EA), or state licenses, along with experience in preparing specific types of tax returns or handling niche accounting areas. These qualifications remain important, especially for firms that require specialized expertise.
However, today’s competitive hiring market has shifted priorities. Many firms now place growing emphasis on communication, adaptability, and client relationship skills. While you can teach someone accounting knowledge, soft skills like teamwork, problem-solving, and customer service are harder to develop — but are crucial for long-term success.
What do prospective clients look for in an accountant or CPA?
When prospective clients are searching for an accountant or CPA, they often make decisions based on limited information, including your website, social media presence, or marketing materials. That’s why first impressions play a critical role in how clients perceive your firm.
Here are some vital factors that influence a client’s decision when selecting an accounting professional:
- Professional online presence. Your website should be modern, mobile friendly, and easy to navigate. Use clean design, professional branding, and clear calls to action. An SEO-optimized accounting website can help potential clients find you and trust your credibility.
- Professional environment. Whether you meet clients in person or virtually, ensure your workspace or digital meeting setup looks professional and organized, as it reflects your attention to detail and reliability.
- Trust and assurance. Clients want confidence that their accountant or CPA will represent and defend their interests, especially when dealing with the IRS or other regulatory agencies. Building trust through transparency, responsiveness, and expertise is essential.
- Industry expertise and alignment. Understand your target market — whether it’s small businesses, freelancers, or corporations — and clearly communicate how your accounting services meet their unique needs.
In short, prospective clients choose accountants who combine professionalism, expertise, and approachability. A strong online presence, personalized service, and demonstrated reliability can make all the difference.
Thanks to our subject matter experts, Jordan Kleinsmith and Mo Arbas, for their input into this article. Last updated February 20th, 2026.
