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How To Expand Your Tax Practice To Include Planning



Transition is always difficult in business. Whether you are adapting your business model, service offerings, or changing lanes altogether, the transition can bring about some hard yet necessary and ultimately rewarding developments. 

Here at ACP, we see this often especially with people who began as a tax-only practice and want to expand their service offerings to include financial planning. With the high volume of traffic and workload of tax responsibilities, many CPAs are wary of adding financial planning into their already busy practices.

But as many have found, financial planning not only enhances the quality and service provided to clients but also the tax work itself. Can a tax practitioner transition into a full-service financial planner and how can they do it successfully? 

Today, we are going to talk about a few things to keep in mind as you begin to include financial planning in your tax practice.

The nature of tax-only work

Many CPAs who run their own tax business find the daily duties and responsibilities can be overwhelming, especially wading through hundreds of tax returns for corporations and individuals alike. This can cause a lot of stress and actually take you further away from the work you really love to do. 

One of our ACP members, Bridget Sullivan Mermel featured on our podcast, found this to be her experience. Underwater with over 250 tax clients, she found that she was stuck navigating policy and paperwork and not able to help her clients in the way she wanted. 

Bridget found the heavy tax season overwhelming and draining especially after years of operating in this way. She found that she was working long hours and felt more dissatisfied with her job as the years went on. She loved her clients and serving them well, but the work itself was far from inspiring.

To her, taxes were so much more than a once-per-year rush, but she didn’t have the business model to be able to provide proactive tax strategies. She began looking for alternative options. The hard thing for Bridget, like many people out there, is that she didn’t know where to start. Searching for other business models proved to be an arduous task, one filled with commissions and sales and as a CPA those service-models didn’t resonate with Bridget. 

One of the most important things needed for a successful transition is support—support in terms of resources, time, education, and community. She found these things with ACP. 

Why fiduciary?

On her quest for the right business model, Bridget encountered numerous options. But she found that some of the popular models out there didn’t give her the opportunity to serve her clients in the best way possible. 

She was a CPA, so fiduciary standards ran in her blood and it felt natural that she build a practice around this philosophy. Our advisor family at ACP is dedicated to our fiduciary standard, offering advice that always, and only, operates in the client’s best interest. 

This way of doing business resonated with Bridget and her clients. Operating as a fiduciary financial advisor, she found that she was able to start doing the work she loved to do, which was looking at her client’s financial needs on a holistic and comprehensive basis. Her clients saw this and responded well to it. 

Bridget found, as many fiduciary advisors do, that she began to develop a closer and stronger relationship with her clients, namely because her relationship with them became less transactional and more meaningful. 

Instead of simply seeing them once per year to file taxes, they were able to talk about hopes, dreams, aspirations, values, and how to use and arrange their finances to support those. The relationship had depth, substance, and meaning, which provided more fulfillment in Bridget’s life as well.

Steps to help navigate the transition

Before any big business change, it is important that you know what you want your business to look like. That starts by developing a new business model that supports the type of work you want to do. For Bridget, she knew that she wanted to work fewer hours, and with the right structure, skillset, and work ethic was able to make that happen.  

Choose a business model

Here at ACP, we focus on a retainer-based model and that is what Bridget found worked well in her practice. This way she was able to increase the value she was providing clients, have fewer client meetings, and do the strategic financial planning work that inspired her. 

As she made the transition into her new financial planning practice, the breadth of her service offerings changed to include:

  • Tax planning and tax preparation
  • Retirement planning
  • Education planning
  • Insurance needs
  • Estate planning/Legacy planning

It was this model, she said, that really changed the way she did business and helped give her the lifestyle she wanted. 

One of the biggest changes for Bridget was her renewed love of tax planning. She had a passion for proactive tax strategies and helping clients with year-round financial habits that support an active tax planning strategy. “I like what I am doing with taxes better,” she said.

Find a mentor

Mentorship is key to building a practice that you love. What better way to enhance your practice than with help from someone who has done it successfully? By doing research, networking, and meeting new people in the industry, you will be able to see what has and has not worked for others. What Bridget found in her career is that most people are happy to talk to you about their business, you just have to ask. 

Mentorship takes you out of your comfort zone and exposes you to new ways of thinking about a topic or idea. This is a practice that Bridget found invaluable throughout each phase of her career. Between mentorships and coaches, she was always dedicated to improving her skill set and knowledge to build the life and firm she wanted. 

Coaching and mentoring force you to ask the hard questions:

  • What is going wrong?
  • Where can you improve?
  • How can you make changes that support your vision for the future?

This is a powerful experience for many and can be beneficial as you evolve your practice and services. 

Communicate with your clients

Once you are confident in the direction that you want to go, you’ll need to address your current clients. For Bridget, she knew that she didn’t want to keep her existing tax practice and would rather start from scratch, but not everyone likes to do it this way. 

You can transition into an entirely new practice or retain your current one and begin a system to filter out the clients who won’t fit into your new business model. 

But discerning how to tell your current clients about this big business change can be daunting. Bridget found ACP’s scripts to be a wonderful resource to clearly demonstrate her reason for switching and the added value it would provide clients. In the end, she said that most of those calls went really well. Our goal at ACP is to provide advisors with the tools they need to build successful practices. Our client communication scripts are just one notable example.

Play to your strengths

When you know how to run a business, you already have an advantage. Bridget found that her knowledge of running a successful tax practice set her up for finding business success in her next venture. It is important as you make the transition to include financial planning that you continue to play on your strengths and use them to build your business.

How ACP can help

The transition from a tax practice to a financial planning practice is hard. It will be filled with immense joy and also a few hiccups along the way. As you make these changes, it is important that you have someone in your corner, arming you with the resources you need to thrive. 

We love to see advisors transition into providing the type of services they love and we would love to be a part of your journey. Interested in learning more about what it means to be a member of ACP? Schedule a time to talk with our team today.