Monthly Archives: April 2013

Our 2nd Tax Season

So last year was our first season with the new office.  Based upon what we learned, we planned to make 2013 even better and we’d have to admit that it was.  While we can’t share specifics around all our numbers, here are some of the things we can volunteer:

  • We engaged roughly 112 clients and processed 130+ individual and business returns (not including state returns)
  • Experienced revenue  growth in excess of 150%
  • Processed returns in 10 new states
  • Completed our CTEC certification so that we can now prepare California tax returns (we processed 2 for this season)
  • Placed more returns on extension that in years past; largely due to not being able to service demand in the last 3 days of the season (from clients like the one pictured below)

No, we can’t finish your return before the 15th!

What went well

Delivering excellent customer service.  One of the ways in which we try to different ourselves from our competitors is by focusing on our relationships with our clients.  We have always sought to treat our customers like they were members of our family and make it a point to deliver excellent customer service.  We think that this must be working pretty well as we received 30% of our client growth from existing client referrals.

Leveraging free advertising.  Our company uses social media, posts ads in places like Craigslist, has profiles on platforms such as Yelp, Bing, Google etc.  What’s common about all of the above is that is cost us nothing more than a few minutes of time to set up and maintain.  Yet each one of these platforms more than pays for itself in that it brings us at least one new client per season.  With that being said, we think we’ll continue to make sure our presence is felt out there in the internet ethos.

Deepening our partnerships.  In 2012 we had a few independent sales reps who helped promote our brand.  In 2013 we increased that number to around 6.  Each one of these individuals helped us significantly expand our presence and was responsible for a fair amount of growth.  Likewise, we forged another partnership in early 2013 with a 3rd party that drove significant business to us this year.  We look forward to continuing all these relationships next year.

What we’ll adjust 

Marketing that isn’t working.  Each year we test out some things to see if we can get an edge on our competitors.  Some of it works and some of it doesn’t produce much of anything.  The key is to be able to track what a marketing piece is doing so you can know what should be retained and what needs to be scrapped.  With that being said, we’ll probably shift some of our dollars out of print, organizational and media advertising.   We have some ideas of what we want to test next; such as Jared Rogers’ mug on a bus bench or big billboard on the side of the highway so stay tuned!

Aspects of our client relations program.  Existing clients are how we generate a lot of our new business.  Thus, it’s pretty important that we engage them on a regular basis.  But when certain things don’t yield the engagement or interaction you would like, then maybe it’s time to shake things up.  On this front we’ll probably modify our newsletter program and reduce the frequency of it.  In its place we plan to increase some of the other ways we “touch” our clients such as birthday cards, holiday correspondence, biannual client calls and increased classes/workshops.

Our commitment to working smarter.  One of the epiphanies we had this season was how much more lucrative it was to work with our corporate clients on a revenue per hour basis.  Jared has a pretty good background working with Partnerships and S-Corps, which in turn sometimes have problems because they weren’t set up correctly.  To that end, the firm may make a switch to more actively seeking these clients as opposed to individuals.  While this doesn’t mean we’ll abandon taking on individual tax clients, it does mean that we will place some marketing efforts towards attracting more corporate clients.  Hey, if you can make 3 times as much revenue in the same amount of time, doesn’t it make sense to work a little smarter?

2014 will mark our 3rd season with the retail office and we are truly hoping that it is more successful than our wildest dreams.  To that end, keep your eyes peeled as we’ll be making many of those adjustments noted above in the coming months.  How knows, maybe next year we can exceed the growth we achieved in 2013.  If that happens, we think we’ll need to start hiring some more folks before Jared collapses from exhaustion!

Until next time…

How To Deal With IRS Debt

So these little envelopes that read “Official Business – Penalty for Private Use, $300” kept showing up in your mailbox.  You kind of had an idea of what they were about since they said they were from the Department of The Treasury.  But you figured that if you ignored them they might go away.  Or maybe you just needed a little more time to save up some money so that you could settle your debts.  But time kept passing, you never settled up and the letters kept right on coming.  When you finally decided to open one of those envelopes, it said that the IRS was in the process of levying you.  Now what?

If you are faced with tax related debt, it’s important that you take the following steps as soon as you can:

Own the situation.  All difficult situations only get worse the longer that you prolong dealing with them.  Think about it, does that achy tooth get better by itself?  Will that funny noise your car is making just go away if you ignore it?  Do those termites in your house stop munching on everything if you just pretend they aren’t there?  The answer to all of the above is no.  The first step to dealing with tax debt is to own up to it and start the process of resolving it.

Assess the damage.  We recently were dealing with a client who hadn’t filed taxes for 6 years.   They didn’t want to deal with the situation because they figured they owed thousands of dollars.  Well, when we prepared their returns it turned out they only owed about two thousand dollars – initially.  Because they didn’t deal with it early on the IRS penalties and interest just about doubled the initial balance owed.  Thus, it’s important that you assess just how much is owed as soon as possible.  Our experience has been that the situation typically isn’t as bad as a taxpayer thinks.  Additionally, if you are willing to work with the IRS you will find that they’ll reciprocate.

Seek professional help if needed.  Some tax debts can be settled without too much professional assistance.  Did you know that if you owe $50,000 or less in combined individual income tax, penalties and interest you can apply online for an installment agreement?  Yup, no need to speak to anyone at the IRS or have a professional get involved.  Now that is, of course, if you can make the payments.  If you owe a lot, don’t have substantial assets or just can make any sort of “significant” payment, then maybe you should have a professional look at your situation.  They may be able to recommend options that can help you pay your debt AND not put yourself under financial stress while you do so.

Ensure that your professional is qualified.  There are lots of boiler room tax resolution firms out there that will promise you they can settle your debt for pennies on the dollar.  When reviewing any firm, make sure that they have the following:

  • Professional, and Useful Website
  • Successful Track Record
  • Friendly, Helpful Representatives
  • Easy-to-Understand Fee Structures
  • Free Analysis and No Guarantees

Figure out your options.  When it comes to tax resolution, many people hear the advertisements touting how they can settle for less than they owe (i.e. an offer in compromise).  While this is in fact true, this is not the case for 80% of taxpayers because they will not qualify for an OIC.  You have to remember that the IRS is the collections arm of the US Treasury and that they are not in the business of giving away free money.  With that said, tax resolution typically falls into the following categories:

  1. File unfiled tax returns
  2. Dispute the tax debt on technical grounds
  3. Request penalty abatement
  4. Request innocent spouse relief if the debt was the fault of your spouse or ex-spouse
  5. Pay the tax debt in full
  6. Request an installment agreement
  7. Put the debt into currently not collectible status
  8. Apply for an offer in compromise
  9. Await expiration of the collection statute expiration date

Move forward.  Once you outline your arrangement to resolve your tax debt, make sure that you have a plan in place so that you don’t create any new debt.  For example, if you receive most of your income via 1099, make sure that you make estimated payments though out the year.  Lastly, take a personal vow to never generate tax debt going forward.  While there are numerous people you can owe, the IRS is really the only entity that can make your financial existence almost unbearable if you let it get that bad.  Thus, let’s all try and stay on their good side shall we?

Until next time…

Growing Your Business Takes Time

When many entrepreneurs begin their new venture, they often believe that things are going to just “sort” of happen.  You know, we’ll come up with some financial projects for our business plan, find a location, open for business, customers will love us and we’ll grow like gangbusters.  Right?

Unfortunately, the startling reality for many new businesses is that the “grow like gangbusters” phase often takes a lot longer than you originally projected.  Why?  Well, sometimes new entrepreneurs go into business with incorrect assumptions.  These can range from the amount of funds needed to start the company to the lift they expect from their marketing campaigns or just the amount of initial/repeat business they will get.

This is why we often advise those bight-eyed and bushy tailed entrepreneurs that come and see us for a consultation that they need to “double down” on their numbers.  No matter how good their assumptions are, they will need to double the amount of money, time and effort they originally thought they would need if they are going to be successful.  We then also tell them that they need to focus on the following:

Marketing.  Build it and they will come.  Well…only if customers have a need which you can satisfy, know where to find you and can see that you have benefits that your competitors don’t.  In order to communicate all of the above to your new would be customers; you better make sure you have a marketing plan.  And sorry, word of mouth is not a marketing plan.  It is a component of your marketing plan, and in all honesty it’s one of the “weaker” ones as you are “hoping” that your customers will go out and sing your praises to everyone they meet.  Instead, come up with 6-10 mechanisms that you will use to promote your company/product and actively work on them each day.  They don’t have to be expensive, but you do need a plan and a number of marketing vehicles if you seriously want to survive the startup phase.

Sales.  Marketing brings the people to your establishment.  Sales then conveys what you have to offer and why the customer should purchase it.  Without marketing you have no sales.  Without sales, you have no work to perform or products to make or services to provide.  Thus always remember this; no matter what you “do” in your business, that is actually the tertiary stage of operations.  You are a marketer FIRST, a sales person SECOND and then (and only then) are you a baker, nail technician, bookkeeper, dance instructor, socialite, etc.

Good customer service.  We’ve spoke about this topic at length, but it needs to be emphasized.  If you want customers to come back, make sure you offer good service.  You can be the best at what you do and offer the best product, but if the customer has a bad experience, you can kiss their repeat business goodbye.

Shoot for the moon.  Sometimes us humans really want to be failures but at other times we are just afraid to succeed.  Honestly, sometimes we are petrified by what would happen if things actually went well.  What if I got that job in California?  Then I’d have to uproot my family and move to take it.  What if our business grew at 500% next year?  Man, we’d have to hire people and I’d be really busy.  I kind of like things they way they are.  Maybe I just won’t try to grow “that” much next year.  Well let us clue you in on something; it’s actually fun to deal with some of those problems.  So don’t sell yourself short.  Don’t be afraid if your wildest dream comes true.  Shoot for the moon and deal with the “problems” once you have them, not before you get them.  Trust us; we think you’ll be happy with the result.

Keeping The Faith

It’s been a while since I’ve posted anything about my escapades within the company.  Part of that was because we had a pretty good tax season; which we’ll share via a post in a few days.  However, another reason was because I had been dealing with a roller coaster of emotions during this same time period.

You see, back when I took the plunge to head up Wilson Rogers on a full time basis, my wife and I cut a deal.  3 years.  Yup, that was the amount of time that I had to make it work or it was back to Corporate America for me.  Hey, when you have a family to support, you have to do what’s in the best interest of the unit and not what you desire.  Well, this was the second of those three years and needless to say I was feeling the pressure.

While season one was okay, the financial results weren’t what we needed them to be given the three year time frame.  Thus, it was imperative that season two be pretty good and then some.  The genesis of our 2013 tax season went something like this:

  • Due to 2012 bills, the company’s cash had gotten so low that I had to make a capital contribution
  • The Fiscal Cliff shenanigans of Congress pushed the start of tax season back by two weeks
  • Our newsletter program that we had banked to bring us in some new clients wasn’t producing
  •  I had a meltdown about mid season under the premise that things were not going to work out and we weren’t even going to hit our minimum revenue goals
  • I resolved to do anything and everything that I could to try and turn things around
  • The presence of our facility being in the neighborhood for a second season started to bring us new clients from the neighborhood
  • A few practitioners in the area retiring brought us some more clients
  • Our client referral program finally kicked in and a few rainmaker clients from 2012 gave us a nice amount of referrals
  • A partnership program that we had with a major company brought in more money then we had anticipated in our wildest dreams
  • We finished the season out strong and beat our minimum 2013 revenue numbers

In case you missed it, the turning point with our season happened in bullet number 5.  I had no idea how I was going to make things work, but all I knew is that I needed to do something.  And what was that something?  It was keeping the faith.

You don’t have to be a religious person to buy the concept of faith.  Quite simply it’s believing in something that you can’t see, hear, taste, touch or feel.  It’s having the courage to push forward when everything is giving you indicators that you should stop.  It’s knowing in your heart of hearts that if you keep at it long enough, things will work out.

Every entrepreneur reaches that deep, dark place that I hit earlier this tax season.  It’s an inevitable part of the process of growing your business.  But if you are willing to keep the faith, just know that it gets a little brighter on the other side.

Until next time…